lbo-talk-digest V1 #1023

Tom Lehman uswa12 at
Thu Feb 25 08:21:39 PST 1999

Dear Barkley and Carl,

As my wife often remarks to me, "Archie, what are you mumbling about now?"

Your email pal,

Tom L.

"J. Barkley Rosser, Jr." wrote:

> James,
> This list used to have more discussion of economics and finance, so
> much so that Doug was unhappy. So, then he started a thread/seminar on the
> writings of Judith Butler, theorist of the lesbian phallus and other
> brilliant stuff. The result is what you see today...
> Barkley Rosser
> -----Original Message-----
> From: James Wilson <James_Wilson at>
> To: lbo-talk at <lbo-talk at>
> Cc: lbo-talk-digest at <lbo-talk-digest at>
> Date: Wednesday, February 24, 1999 2:58 PM
> Subject: Re: lbo-talk-digest V1 #1023
> >Dear LBO-talk participants,
> >
> >As a newbie who has just joined this listserve after reading Doug
> >Henwood's excellent book "Wall Street", I'm a bit surprised to find that
> >it doesn't seem to involve much discussion of business or economic issues
> >per se, and has drifted to topics\s as far afield as good/bad television
> >programs and women's body images... all valid and interesting topics, but
> >not quite what I had in mind after reading "Wall Street"...
> >
> >Rather than just bitch about it, I'm going to try to start the ball
> >rolling in a different direction...I'm posting a short article which I
> >just wrote for my local ---ie, St. Catharines Ontario --- Unitarian
> >fellowship's newsletter. As president of that august body, one of my
> >duties is to write a monthly column.
> >
> >I invite your comments- good,bad or ugly!
> >
> >Yours,
> >
> >James Wilson
> >
> >
> >****************
> >
> >My dear fellow Unitarians,
> >
> >I have been writing and re-writing the following column for the past
> >several months. Well, there’s no time like the present, so prudence be
> >damned, here goes...
> >
> >As many of you know, I have become interested in economic issues over the
> >past few years. My study of the financial system underpinning our modern
> >world’s economic and political system has led me to become a thorough
> >non-believer in the beliefs and rituals of the new religion “Free Market
> >Fundamentalism”. Examining carefully the dogma of our modern-day popes,
> >cardinals and priests (ie Wall Street bigshots, central bankers,
> >neo-liberal thinktanks, the IMF and World Bank, corporate CEO’s,
> >economists, paid-off politicians, etc. etc.) what we see is a fabric of
> >half-truths and outright lies, chiefly useful for weaving into lovely
> >clothing to dress up the gods of greed and avarice.
> >
> >You have probably heard about the depression-style conditions the
> >Russians, Indonesians, Brazilians, Mexicans, and now many of our Canadian
> >hog and grain farmers are now enduring. But somehow the worshippers of the
> >Savage Market God have managed to evade all responsibility for what
> >radical University of Ottawa economist Michel Chossudovsky has called “the
> >globalization of poverty”. Considerable resources have been used to
> >persuade us that prosperity for all lies just around the corner --- or at
> >least, it might if only that damned government would stop meddling.
> >
> >Well, here we go off the deep end: I am going to make a rather dire
> >prediction: sometime in the year 1999, I believe that the Western world
> >will finally reap what has been sown for the past ten or twenty years, the
> >Crash of ’99 -- which will the 1929 stock market crash look like a Sunday
> >school picnic. What the hell, I will even go so far as to predict that
> >this will happen in October, traditional market mayhem season.
> >
> >How can I justify this dark apocalyptic vision? Has your president gone
> >bonkers? Well, time will tell. But here is my reasoning.
> >
> >First of all, many of the world’s major debtor nations are reaching the
> >point, after years of austerity, sacrifices and belt-tightening, where
> >they just won’t be able to stay on the debt treadmill any longer, and will
> >simply have to default, just as Russia is in the process of doing. This
> >will certainly wipe billions of dollars off of Wall Street. I’m thinking
> >here especially of Mexico, the world’s greatest debtor nation. (Remember
> >all the great things that NAFTA was supposedly going to do for Mexico?)
> >
> >Secondly, if you read John Kenneth Galbraith’s book “The Great Crash”,
> >available at the public library, you’ll recognize a lot of today’s events
> >-- but with one major difference. Hardly anyone in the twenties was
> >expecting a crash. Today, just about all the big shots, including the head
> >of the U.S. Federal Reserve Bank, are plainly worried about one. They
> >don’t share these fears boldly with the general public, but if you listen
> >closely, you will hear allusions to them sotto voce.
> >
> >Banks and other financial institutions have covertly acquired exclusive
> >title to create more and more money through lending and other mechanisms.
> >So, there are too many dollars (and other financial instruments) for the
> >real goods and services available. The typical figures cited: $72 are
> >traded in the “financial” economy for every $1 used to buy and sell real
> >goods and services. To watch the TV ads lately, you’d almost believe that
> >mutual funds were the major national product of both Canada and the United
> >States. What they really are is casino gambling having little or nothing
> >to do with investment in real goods or services.
> >
> >We in the developed world now have a “bubble economy” where the tacit
> >policy of both our large financial interests (ie, our unelected
> >government) and our elected government is keep that stock market going
> >ever higher. And what is making the stock market go ever higher?
> >Technological innovation? A rising worldwide standard of living? Better
> >health, education and housing? A higher price to earnings (P/E) ratio for
> >stocks? No, no, no and no.
> >
> >Merger-mania, “downsizing”, systematic, planned wipeout of the currencies
> >of many of the world’s smaller nations, global piratization of public
> >assets. Like a cancerous growth upon a healthy organism, the casino
> >economy is growing at a tremendous rate while sucking away at the
> >lifeblood of its host, the productive “real” economy .
> >
> >For example, a recent study by the Vanier Institute of the Family show
> >that ordinary Canadians are facing record debt (“Right now, families are
> >not saving one red cent”) with real family incomes virtually flat since
> >1980. Two spouses now typically work to make the same salary that one used
> >to bring in.
> >
> >If and when there’s a sudden loss of confidence, then all the players will
> >rush to cash in their chips at the same time to purchase real goods and
> >services. As if 72 people all tried to sit down in the same chair.
> >
> >If my prediction is right, we are now living in the last days of Pompeii.
> >What does one do in such circumstances? Well, you try to cash in your
> >chips before the high rollers do; withdraw all your money from the bank,
> >perhaps converting it into U.S. dollars or gold, and then bury it in a jar
> >and wait.
> >
> >Time will tell, and you’ll soon have the chance to either deride Wilson as
> >a dangerous crank, or praise his foresight and rue the fact that you did
> >not follow his wise advice.
> >
> >
> >James Wilson
> >
> >
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