Doyle; The scale of the losses, 2 trillion or so according to Goldman Sachs or about %7 in their way of calculating non-financial sector debt (see LP's recent note). Your point I think relates to a concept of how does money get spent. Is it socially useful or is the money pointed at fools gold profits (high risk returns)? I don't think this is entirely fictitious in the sense that development in the g20 is based upon these money flows. The pain from outsourcing is very real. the displacement pain from peasants forced off the land into the cities is very significant.
If real estate collapses in value the creative destruction you talk about is social rot. People 'buying' homes that are then taken away because the huge profits dream is based upon extracting gold from their empty pockets. Of course that is my experiences in life speaking. Perhaps Jim Devine can elucidate? Thanks, Doyle Saylor ^^^^^^^ CB: Yes, the mortgage foreclosure crisis for the working class and middle income strata is in the form of evictions and loss of homes. The news doesn't seem so interested in that as it is in the loss of finance capital profits. Anyway, the old sense of recession was a system wide economic hurt. Now in the US in the last twenty years or so, they seem to be able to put "recession" style hurt on the working class ( evictions, income loss) while avoiding the same level of hit on profits as in the old recessions , no ? Maybe Jim Devine can correct me if I'm wrong. The new recessions are spot recessions, like putting single states like Michigan in recession, but not the economy of the US as a whole. Somehow the US has avoided significant GDP slump. The business cycle, in the traditional sense, seems to be blunted for the US. economy
