>The other night a retired Nortel guy I always chat with about the market
>while he and his wife eat pizza said something like, you know, maybe the
>communists were right about capitalism leading to it's own destuction
A point today's NY Times Week in Review helpfully clarifies. Under the headline "Could Capitalists Actually Bring Down Capitalism?," Wall Street reporter Kurt Eichenwald reviews the recent scandals, and then reassures himself and others with this passage:
>Could the short-term, self-rewarding mentality of a handful of
>capitalists truly destroy capitalism? Bring on hundreds of
>bankruptcies, force banks under, end the giving of loans? Destroy
>America as we know it?
>
>Not very likely. The system has a built-in corrective factor, which
>kicks in when abuses go too far. Harm to investor confidence harms
>the market, which harms the ability of corporations to raise the
>capital they need to grow and be profitable. Eventually, the
>capitalists' desire get investor confidence back wins the day.
>
>Already, after years of sniffing at naysayers who wagged fingers
>about fundamentals, investors seem to be discovering a new affection
>for stodgy old stock analysis. "Nobody was paying attention to
>seemingly boring topics like accounting and corporate governance,"
>said Troy Paredes, an associate professor at Washington University
>School of Law. "People are realizing that those are the things that
>matter."
So there.
Doug