Chris Burford wrote:
>I see this as the US managers cleverly ensuring that when "a" mass of
>productive forces needed to be destroyed, it was Asian, especially
>Japanese. There was some destruction in the imperialist heartland but very
>little.
Considering that Japan is routinely spoken of as being in some kind of depression, a look at the actual numbers doesn't match the tone of alarm. GDP growth in Japan since 1990 has averaged 1.0% a year; 1998 was the first year of the decade in which there was an actual decline (-2.8%), and the IMF projects another 1.4% decline this year. That's profound stagnation, but not the wholesale destruction of capital. Peripheral Asia is where the destruction happened.
Japan's stagnant, as is the EU; the U.S., while not "booming," as some would have it, is growing reasonably well. So I'd reformulate this saying that the core of the core - the U.S. - is doing best, the periphery of the core - the EU and Japan - is stagnant, and the periphery has taken almost all the lumps.
>The largest mass of capital withstands the crisis best. Bits of US capital
>had to be destroyed but only bits. The art of state management of this
>process was to ensure it took place smoothly and invisibly. LTCM was the
>crunch. It was *both* bailed out and discounted, in one and the same
>manoeuvre. I stand open to correction on the details but I suggest that is
>what happened.
Actually LTCM has recovered enough to pay back its saviors, and has been raising fresh investment funds.
The big question, of course, is whether the core of the core will remain exempt from "adjustment." That all depends on whether U.S. capital has securely restored its profitability and is thriving by exploiting the leading edges of industry, or whether it's all a bubble, and the idea that the U.S. is exploiting the leading edges of industry is itself part of the bubble. I'm guessing the next downturn, if there's ever another one of those, will clarify this.
Doug