Daniel Davies wrote:
I don't think liquidity shows up all that much as being a particularly important thing in Marx; in Keynes it's fundamental.
Marx does have a theory of "monetary crisis" based like Keynes's on the psychological idea of "auri sacra fames." It's this psychological element that underpins Keynes's claims about the harm done by the normal functioning of financial markets. It explains the "fetish" character of "liquidity." "Of the maxims of orthodox finance none, surely, is more anti-social than the fetish of liquidity, the doctrine that it is a positive virtue on the part of investment institutions to concentrate their resources upon the holding of 'liquid' securities. It forgets that there is no such thing as liquidity of investment for the community as a whole. The social object of skilled investment should be to defeat the dark forces of time and ignorance which envelop our future. The actual, private object of the most skilled investment to- day is 'to beat the gun', as the Americans so well express it, to outwit the crowd, and to pass the bad, or depreciating, half-crown to the other fellow." http://www.marxists.org/reference/subject/economics/keynes/general- theory/ch12.htm Ted
