From: Jurriaan Bendien (adsl675281@TISCALI.NL)
Date: Sat Oct 06 2007 - 08:36:59 EDT
Paul, I'll read your book. Just quickly, this definition of economic value as the currently average socially necessary labour time objectified in a product is not unproblematic, insofar as labour-services do not result in any identifiable product. I am not sure how I could possibly prove that the dispersion of exchange ratios around value ratios is small, and that as a whole, it is a zero sum game. But I agree that if asset prices rise or fall due to changing supply/demand conditions, this does not necessarily tell us anything about the Marxian labour-values of those assets. Throughout Cap. 1 and 2, Marx assumes a commodity theory of money and a gold standard, only in Cap. 3 does he begin to qualify this assumption. One question is whether you define the production of the gross output as constituting the whole economy. I do not. And with Marx, I think that capital does not have to be lodged in productive assets in order to be capital. Consequently, it is possible that a larger amount of capital assets can exist external to production, than inside it. I had hoped that, confronted with half a million US home-owners foreclosing their mortgages, that American leftists would investigate the social meaning of all this - what are the specific causes for this, what are the consequences for people's lives, and what opportunities does this create for an alternative politics etc. But they don't do this, instead they reiterate the boring refrain that the rate of profit is falling and that the recession is coming, blah blah. Well, every boom is followed by a bust, but that is not an analysis that can orient anybody (well, I haven't read Michael Perelman's new book yet). - Merrill Lynch said it will have to write down a $5.5 billion loss for bad investments linked to defaulted US sub-prime mortgages. - Fannie Mae and Freddie Mac reportedly could have $4.7 billion in unrealized losses from the deterioration in subprime mortgages. - Washington Mutual forecasts its losses will amount to $975 million. - Eight of Japan's largest banks have so far disclosed U.S. sub-prime losses totaling 20 billion yen (approx. $170 million) - The BBC said total bank losses that will occur from sub-prime defaults are currently estimated at $18 billion (presumably spread over some years). - Total average home prices and home sales in the US are now estimated as falling at about 4% year-on-year. - The Center for Responsible Lending http://www.responsiblelending.org/ estimated that 2.2 million US borrowers who got subprime loans since 1998 either have lost or will lose their homes through foreclosure over the next few years, costing them potentially about $164 billion (this figure however refers to the estimated volume of cancelled loans, not the net financial loss to the homebuyer). These foreclosures would include one in every five borrowers who got subprime loans in 2005-06. It's still not clear to me how a great economic conflagration can result from this rumble alone though. It's best to be Left of the Left, or better still, to be Left of the Left of the Left, i.e. do you own thing, never mind the propaganda. Society gives rise to certain problems, the bourgeois intellectuals then interpret those problems from their point of view, and the Left criticises that interpretation. In the process, the problems are framed wrongly, and it is often no longer even clear whose problem it is anyway. NYT (June 3, 1996) reported that of the world's 5.8 billion people (increasing by 86 million a year) more than 600 million are homeless or living in inadequate, unsafe and unhealthy housing. In 2005, UN Special Rapporteur on Adequate Housing Miloon Kothari estimated that over one billion people on the planet lack adequate housing, while around 100 million have no housing whatsoever. http://ipsnews.net/interna.asp?idnews=28086 Estimates differ on the number of homeless in the US, but it is a fairly safe bet that there are at least 1 million of them. Jurriaan
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