I am curious about the opinion of PEN-L members: could a major financial
crisis be a good thing (by serving as a catalyst for change) even though
it would result in enormous short-term suffering worldwide?
What anyone "thinks" on this is neither here nor there. Crises come (and
crises go). We still have to confront the core truth that "If you don't
hit it, it won't fall."
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.
