Michael writes: > Competition has difficulty dislodging excess capacity. <
Exactly. That's an important reason why fixed capital is so important. Jim Devine, e-mail: [EMAIL PROTECTED] web: http://myweb.lmu.edu/jdevine/ > -----Original Message----- > From: PEN-L list [mailto:[EMAIL PROTECTED] On Behalf Of > Michael Perelman > Sent: Tuesday, February 01, 2005 8:42 AM > To: [email protected] > Subject: Re: [PEN-L] Deficits, the Dollar, and IEDs > > You can get one round of inflation if industry can regain its > pricing power. Competition > has difficulty dislodging excess capacity. Some of you may have > seen recent articles about > Mitsubishi holding on in the automobile industry even though its > prospects seem dim. > Mergers and acquisitions, however, can accomplish the same goal. > The takeover of AT&T may > represent the first step in the diminution of competitive pressures > in the telecom > industry. > > On Tue, Feb 01, 2005 at 06:58:08AM -0500, Paul wrote: > > But doesn't this version of inflation emerge like this: > > Some sector (economic or social) raises their price (or wage) > shifting > > income in their favor; the others resist by raising their price > (wage) in > > turn; and on and on. Ongoing inflation (rather than a one-shot) is > a > > distributional struggle. At some point in this game of "hot > potato" it is > > the turn of wage earners and eventually they are left with the > burnt hands > > (often creditors as well). But this game of "hot potato" can take > several > > rounds (if the wage earners are strong in defending their standard > of > > living). How many rounds the wage earners last is usually the > principal > > factor determining the duration and degree of inflation. > > > > Is there really much countervailing power in the socio-economic > formation > > of the US today? From which part of the economy or society? > > > > Paul > > > > Gene Coyle, citing Daniel Davies writes: > > >As I read almost daily of giant corporations and Wall Street > analysts > > >deploring "the lack of pricing power" I believe that inflation > would be > > >(will be?) welcomed by big capital. > > > > >>Are we absolutely sure that the whole problem will not end up > being solved > > >>by an inflation rather than a recession? I know that this is > the orthodox > > >>view; that US rentier capital is big enough, important enough > and > > >>anti-inflation enough that anything will be tolerated other than > inflation, > > >>but it does strike me that it would sort a lot of things out, > rather less > > >>painfully than they might otherwise be sorted out. > > -- > Michael Perelman > Economics Department > California State University > Chico, CA 95929 > > Tel. 530-898-5321 > E-Mail michael at ecst.csuchico.edu
