Archive for ‘Financial crisis’

August 7, 2012

Porn queen’s money quote

Jenna Jameson at the Adult Entertainment Expo ...

Jenna Jameson at the Adult Entertainment Expo 2007, with short blonde hair (Photo credit: Wikipedia)

From Jeff Weintraub:

Jenna Jameson cuts to the heart of the matter

Quote of the Day

“When you’re rich, you want a Republican in office.”

— Porn star Jenna Jameson, quoted by CBS News, endorsing Mitt Romney for president at a San Francisco strip club.

Actually, the rich, unlike many other people, have mostly been doing fine during the Obama administration (not least because Obama and the Democrats saved the economy from going over the edge into a full-scale depression). They also did fine, incidenatlly, during the Clinton administration. And even if they wind up paying slightly higher taxes, at Clinton-era rates, they’ll still be doing fine. But that doesn’t prevent them fromwhining that they are being mistreated, and that any failure to accord them total deference (“class warfare”)  is somehow bad, not just for them, but for the public interest. Jenna Jameson, at least, seems to have been straightforward about her reasons for supporting Romney … now that she’s gotten rich herself.

(See the follow-up at The Borowitz Report.)

Jeff Weintraub also passes on some useful links on which economists are worth listening to. The first is from Jonathan Portes. Here’s his money quote:

My shortlist (apologies in advance to those I’ve omitted) of economists commenting on macroeconomic policy who I think qualify is something like the following:

  • KrugmanDeLong, and Wren-Lewis on fiscal policy when interest rates are at the zero lower bound;
  • Adam Posen on monetary policy when interest rates are at the zero lower bound;
  • Martin Wolf on private sector savings and public sector deficits (the financial balance approach);
  • Richard Koo on the implications of a “balance sheet recession”

Jeff W follows up here, with Brad DeLong and Mark Thoma. Finally, here is Bruce Bartlett on where the US Federal deficit came from.

April 6, 2012

Deglobalisation?

The government surplus/deficit of Portugal, It...

The government surplus/deficit of Portugal, Italy, Ireland, Greece, United Kingdom, Spain (PIIGGS) against the Eurozone 2000-2010. Data from Eurostat. (Photo credit: Wikipedia)

From IWCA:

The current Eurozone crisis is only the spearhead of a wider crisis of globalisation. The neo-liberal economic model which has swept the world over the past thirty years has reached, or is reaching, its limits. Senior capitalist spokespeople are talking of the possibility of ‘deglobalisation’, and the need for a ‘rebalancing’ of the global economy. We are in the early stages of a transition to a post-neo-liberal era. What that era will look like is unknown, but there is no guarantee that it will be progressive. 

read more »

August 25, 2011

Karl Marx is hot

Karl Marx

Image by Dunechaser via Flickr

Joe Weisenthal in Business Insider:

With things going the way they are, a lot of people are talking about big history in action, whether it’s the breakup of the Eurozone, or the simultaneous market/economic/political spasm happening in the US.

Today Paul Krugman reminds us once again that this could be 1937 all over again.

Simon Johnson thinks it could be even worse: The long depression of the 1870s all over again.

Recently Nouriel Roubini got a lot of attention for saying that Marx basically got the battle between labor and capital correct, and that capitalism itself now stood on the brink of collapse.

And even on Wall Street…

UBS’ George Magnus has a big piece out on political economy favorably quoting Karl Marx[…]

Again, you know it’s a real panic when everyone’s trotting out the old guys, and even capitalists think Marx got the endgame right.

Here’s what Roubini said:

“Karl Marx said it right. At some point capitalism can self-destruct itself because you cannot keep on shifting income from labor to capital without having excess capacity and a lack of aggregate demand,” Roubini said. “That’s what’s happening. We thought the markets work. They’re not working.”

Zombie Marx

Recommended reading, following on from the above: Mike Beggs in Jacobin on “Zombie Marx”, starting with Brad DeLong’s attacks on David Harvey, but moving on to a fascinating discussion of which elements of Marx’s economic theory are relevant today, and how we should approach Marx’s work. Also read: Norman Geras on gravediggers and skeletons.

October 8, 2010

More quick links

Net international investment Position of the U...

Image via Wikipedia

The BRICS: On the richest in China, on the Chinese dragon versus the Indian tiger.

Financial crisis: On the international currency war, on the lessons of the 1980s trade deficit, on US banks faking documents to rush foreclosures, and on jobs in America’s economy.

The UK cuts: On money, class and power.

September 29, 2010

In a complex world…

The Propagandist features China’s rising hard power with a fascinating video.

Another aspect of the multipolar world whose contours are becoming increasingly visible is the rise of the so-called “Moscow-Ankara-Rome” axis. Volvbilis has been covering this well, for instance in this piece, originally from the Strategic Culture foundation.

Female garment workers in sit-down demonstrationOne of the key labour disputes of our times that of the garment workers in Bangladesh, which Libcom has been covering well. For more news from a trade union perspective, see LabourStart.

Daniel Ben-Ami in Spiked has a great piece about Vince Cable as an example of the reactionary, misanthropic anti-capitalism sweeping the world. David Osler describes Cable as a “populist not a Marxist“, while Carl Packman calls him “capitalism’s posterboy“.

Also from the UK, Chris Dillow punctures the immigration orthodoxies in new Labour Party leader Ed Miliband’s speech.

From the archives: Modern Times magazine in the 1980s on austerity, in an article all too relevant today.

September 19, 2010

Chart of the week: What does progressive austerity look like?

Story here.
September 4, 2010

The exact opposite of a smart idea to prevent economic collapse: Print money to pay the Wall Street terrorists

Obverse of the Series 2006 $20 bill

Image via Wikipedia

Steve Randy Waldman thinks Washington should give you cash. Not just you, of course, he would also give it to your neighbor, your cousin Stella, and Paris Hilton (Lord knows she needs the money). Everyone would get some cash. It would be deposited in their bank accounts, or otherwise handed over in order to address the absence of demand that is now wreaking havoc on the economy.

[READ THE REST]

July 7, 2010

The enigma of capital

[Via AGT]

Read this post by Resonance, and then watch the video (embedded below the fold).

“The crisis reveals its true face, we are drowning in excess capital, in our own alienated labour.”

read more »

June 23, 2010

Chart of the week: the cost of insuring against sovereign debt

Google Image Result for http://www.marketoracle.co.uk/images/2010/Feb/washblog.gif

Source and explanation

June 20, 2010

The last superpower

In Europe, the economy continues to implode. In the UK, analysis by the FT shows, unsurprisingly, that it is the lowest paid who, as ever, will bear the brunt of the economic downturn – while companies like Ernst and Young, which aided and abetted Lehman Brothers in its misdemeanours, go on and on.

Although the big business lobby likes to blame public sector profligacy for the so-called PIGS crisis (and therefore prescribe public sector austerity as the cure), the private sector bears the main responsibility – most clearly in Spain, where the national debt stock stands at about 53 per cent of GDP – among the lowest in the eurozone – while private sector debt stands at a staggering 178 per cent.

Meanwhile, in the USA, as the oil spreads through the Gulf, so do conspiracy theories. The finance sector, however, continues on, despite wave after wave of shameful incidents, the latest culprit being Litton Loans, the sub-prime arm of Goldman Sachs, “America’s foreclosure king”, specialising in loans to (and repossessions from) the US’s poorest home-owners. And America’s global power is declining; it has already lost its hegemony in the Middle East.

The disaster in the Gulf and the crisis in Europe are good indicators of a totally transforming geography of power in the world today. The centre of gravity is no longer the old Atlantic.

As Stephen Walt writes,

Asia’s share of world GDP already exceeds that of the United States or Europe, and arecent IMF study suggests it will be greater than the United States and Europe combined by 2030. Europe has already become a rather hollow military power, and the current economic crisis is going to force European states-and especially the United Kingdom — to cut those capabilities even more. Needless to say, hopes that the euro might one day supplant the dollar look rather hollow today. Politics within many European countries is likely to get nasty as austerity kicks in, and there will inevitably be less money and less support for Europe’s various philanthropic projects in Africa, Central Asia, or the Middle East. Such activities won’t disappear entirely, but it’s hard to see how they can continue at anywhere near their current levels.

China in particular continues to rise. This article analyses China’s strategic interests in Latin America, in the US’s back yard. This article describes its strategy in Africa. China is also on the move in crisis-torn Europe, with the Vice Premier Zhang in Greece this week to grease the rusting wheels of Greek capitalism.

To be sure, China is a new form of global superpower, but that does not mean it is fundamentally different from the old imperialist powers.

While China’s public pronouncements may at times appear mercurial, they are more likely part of a well-conceived strategy. On one hand, China seeks to leverage benefits consistent with being a developing country, plays upon the west’s historical guilt over colonialism, and exploits the west’s continued belief that economic development will inexorably lead to pluralism. On the other hand, it does not hesitate to attempt to parlay its growing power into influence whenever and wherever it can. This Janus-like strategy gives China leeway and flexibility in crafting its international political and economic policy.

And despite occasional posturing from American liberals and conservatives, China and the US remain tied together in an intimate web of shared interests.

However, in China itself, the workforce is getting restive. In a highly unusual move, the prime minister has acknowledged worker grievances.Following the Honda strikes in Guangdong, a Toyota parts manufacturer in Tianjin is now out.  This excellent article shows how the wildcat strike at Honda sheds new light on the suicides at Foxconn, suggesting Chinese labor is reaching a tipping point.

And, along with the China, the new global geometry of power continues to tip towards the oil producing states, especially in the Persian Gulf region, as the BP disaster seems to be doing little to encourage us to break our dependency on petroleum. Global spare capacity is around 6 million barrels per day, nearly all of which is in OPEC countries (around 4.2 million barrels per day of this is in Saudi Arabia) – and these countries are reaping the benefits of a weak Euro caused by the PIGS crisis. Jadwa, one of Dubai’s biggest companies, has just bought one of the largest new office complexes on the Southern edge of London’s financial district, at a serious bargain price.

In turn, the Arab oil states and China are increasingly drawing together:

As Washington’s influence in the world and the Middle East wanes, Gulf countries are weaning themselves from their traditional orientation toward and dependence on the United States. America’s post-war political and economic supremacy in the region is now threatened as a result of its own foreign policy, but equally so by the rise in importance of the emerging powers. No country has capitalized on the shifting landscape more thanChina, which has, consistent with its actions globally, moved assertively to strengthen its ties with the Gulf region generally and in particular with its most important economic and political power, Saudi Arabia.

However, critical voices are in denial about the new geometry of power, and continue to act as if America and its close allies, including insignificant Israel, remain the geopolitical driving forces. Time to wake up.