On 11/10/05, raghu <[EMAIL PROTECTED]> wrote: > Hi Carrol, > > For financial economists, "systemic threat" means a situation where the > regular functioning of the financial markets (i.e. the equity, forex and > the futures markets) is disrupted, e.g. by a liquidity crisis caused by > say the insolvency of a major institution. > > More than any systematic, organized opposition, the major threats to > capitalism today are its own internal contradictions. I disagree that > "crises come and crises go". The last time there was a major capitalist > crisis was arguably during the Great Depression, which did lead to > earth-shaking events. Capital emerged intact perhaps stronger from WW2, > but there is no guarantee that will happen again. A capitalist crisis > e.g. from a derivatives collapse could be a Progressive Opportunity. > > --raghu. >
--------------------------------- "Capitalist crisis certainly reflects the contradiction between exchange value and use value on which commodity production systems rest, since it exhibits a simultaneous increase of unfulfilled need and of unused capacity to meet need. Crises are inherent in a system where the proximate motive for production is surplus value, and the meeting of need is achieved as a contingent byproducts of the pursuit of profit. This analysis cannot, however, support the conclusion that the capitalist mode of production is contradictory in the sense of posing logically inconsistent requirements for its own reproduction, of being, in fact impossible. Crisis must be seen as part of the normal pattern of successful reproduction of capitalism. "Finance appears to be a critical mediating channel between changes in underlying parameters of accumulation like the markupp and the ebbing of aggregate demand associated with the realization phases of crises. The disruption of the financial system is itself one of the most dramatic manifestations of such crises. But the circuit of capital analysis tends to confirm the view that financial problems have their origin in systematic effects of capital accumulation. Crises are not primarily financial, and no reform of the financial system alone can eliminate the tendency to crisis. [...] "Furthermore, if the persistence and severity of crises depend on the persistence of financial imbalances, there are presumably strong state measures available to avoid systemic catastrophe. The financial system is a system of promises, and a financial crisis is a situation where a large number of such promises cannot be met consistently. If the state can achieve an orderly dissolution of enough financial promises, it can create a situation where accumulation can proceed, as long as there is a surplus value potentially available in the unpaid labor of productive workers. "This last remark calls into serious question the idea of a final or ultimate crisis of capitalist production arising from purely from the predictable effects of accumulation. Economic crises may become more severe in their social impact as larger parts of the population depend on capitalist production to meet an ever larger part of their need. But if social labor is capable of producing a surplus, it is hard to see why a society that agreed on capitalist principles could not arrange to have that potential surplus take the form of a surplus value." [Duncan Foley "Money, Accumulation and Crisis" 1986]. If you don't hit it it won't fall.
