File spoon-archives/marxism-thaxis.archive/marxism-thaxis_1997/marxism-thaxis.9709, message 39


Date: Thu, 4 Sep 1997 19:11:10 -0500
From: Doug Henwood <dhenwood-AT-panix.com>
Subject: Re: M-TH: Re: Query & Comment on East Asia


Dennis R Redmond wrote:

>Eisners and Gates ought to know they need insurance against
>further disruptions of a highly unstable, deeply leveraged,
>bubble-besotted superstructure (after the S & L disaster, the 3rd World
>debt crisis, the Japanese bubble and five-year-long banking crisis, the
>real estate bubble and bust, and now the Wall Street bubble, it's
>incredible that our elites still have the gall to claim that "markets are
>more efficient", but such is life in the Left-less 1990s for you)

But their bailouts have worked, and the bourgeoisie is richer than ever.
This does unleash the Minsky paradox - that stability is destabilizing,
that "validating threatened financial practices" only invites more
adventuring. But the bourgeoisie has pulled it out every time.

By the way, a 1996 BIS paper argued that the financial crises of the last
30 years (the period of socialized bailouts) have been more expensive and
more frequent than those of the 19th and early 20th centuries. Preventing
depression has come at great public expense.


>This, along with
>drastically lowered interest rates in Japan, has prevented a global credit
>collapse (as opposed to the localized disasters of the Russian/Mexican
>marketization meltdowns, hastily recontained by the Paris Club banks and
>Clinton), but isn't enough to fund a genuine boom. Bottom
>line: the Long Depression of the 1990s grinds on.

Rentiers don't want a boom.

And it always seems like there's something, just one thing, that's
preventing a global credit collapse. Now it's low Japanese interest rates.
Credit is rarely short, or so it seems.

Doug




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