Michael Perelman wrote: >Doesn't fraud also accompany a falling rate of profit? I have thought about >this relationship quite a bit, but I have seen relatively little written about >it. > >As profit rates fall, companies resort to more and more risky behavior to >compensate for the fall into rate of profit. In the process, they resort to >first flaky and then fraudulent behavior.
In the US, the profit rate rose from the early 80s until around 1997. Funny accounting also increased over the period - in bull markets, people don't want to hear bad news, and they want profits to grow rapidly forever. The bursting of a speculative bubble brings calls for tighter accounting. Doug
