Is there a recent analysis available in Marxian "value" terms? Is it
feasible? Would the rate of profit in Marxian value terms diverge
dramatically from reported profit terms (mostly from financial
companies and oil companies recently)?
Thanks,
Ann
At 09:50 PM 1/30/2009, you wrote:
The world of fictitious value mesmerizes itself by using a strange
language. Financial operations refer to their "shop," as if they
were standing over a workbench shaping metal or wood. Then they
talk about "value creation."
What does that mean? Suppose I start a private equity
company. People give me money to create value. I can create this
value by taking over a company with very little of my own money. I
need a banking accomplice to give me a bridge loan and a compliant
company management. Then I can "unlock" the firm's value.
Once source of untapped value is a pension fund. Workers can be
granted stock in the company as compensation. I can take over the
firm, then use the pension fund to pay for some of the money I
own. I can load the firm up with debt and charge it exorbitant
fees. Now I have begun to "unlock" value.
Next, I can fire lots of workers, including those whose pension fund
financed my takeover. By doing so, I can show that I am creating
efficiencies. Once I cook the books to make the firm look
profitable and sell it to a unsuspecting public.
Should anyone be surprised that many of these companies have been
going bankrupt? And the workers whose pensions were central to the
process? Well, they have some pretty paper.
Ain't capital wonderful?
--
Michael Perelman
Economics Department
California State University
Chico, CA
95929
530 898 5321
fax 530 898 5901
http://michaelperelman.wordpress.com
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