India's richest men lose billions. Fictitious capital or wealth destruction?
http://news.bbc.co.uk/2/hi/business/7938646.stm xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Anthony P. D'Costa Professor of Indian Studies and Research Director Asia Research Centre Copenhagen Business School Porcelænshaven 24, 3 DK-2000 Frederiksberg, Denmark Email:[email protected] Ph: +45 3815 2572 Fax: +45 3815 2500 http://uk.cbs.dk/arc www.cbs.dk/india xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx On Wed, Mar 11, 2009 at 5:04 PM, michael perelman <[email protected]> wrote: > This short essay briefly describes the financial side of my interpretation > that the crash reflected a disconnect between the underlying investment in > the economy and its financial representation -- what Marx called fictitious > capital. The stock market people call this realignment, "destruction of > wealth," even though what is destroyed is the illusion of wealth. The > illusion may have been capable of purchasing valuable things so long as > other people accept that illusion. > > Long ago people accepted the illusion as an illusion and went on with their > business. Here is what a former governor of Illinois wrote: > > Ford, Thomas. 1854. History of Illinois (Chicago: S. C. Griggs and Co.). > > 227: "Our Whig friends contended that the continual and violent opposition > of the democrats to the banks destroyed confidence; which, by-the-bye, could > only exist when the bulk of the people were under a delusion. According to > their views, if the banks owed five times as much as they were able to pay > and yet if the whole people could be persuaded to believe this incredible > falsehood that all were able to pay, this was 'confidence'." > > Ordinary people understood what was happening. Here is an incident from > Chicago about the same time. > > More at: > > http://michaelperelman.wordpress.com/2009/03/11/what-is-the-crisis-about-fictitious-capital-or-the-destruction-of-wealth/ > > -- > Michael Perelman > Economics Department > California State University > Chico, CA > 95929 > > 530 898 5321 > fax 530 898 5901 > http://michaelperelman.wordpress.com > _______________________________________________ > pen-l mailing list > [email protected] > https://lists.csuchico.edu/mailman/listinfo/pen-l > -- _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
