Doug Henwood wrote:
>
> On Dec 17, 2007, at 11:49 AM, Seth Ackerman wrote:
>
> > bhandari at berkeley.edu wrote:
> >
> >> Yes there are always periods in which capital is exported or
> >> caught up in
> >> frenzied speculation but these are usually short lived before capital
> >> finances a new upsurge in real production. That is part of the normal
> >> functioning of capitalism, and perhaps the drop in the dollar will
> >> chase
> >> out destabilizing speculative capital flows and abet US mfg capacity.
> >> Don't see the confidence for that at present.
> >> Yours, Rakesh
> >>
> >>
> >
> > I think this analysis needs closer scrutiny.
> >
> > By my calculation, while the bubble was going on (1996-2006), fixed
> > investment in the real economy rose by 55%. This rather robust capital
> > accumulation yielded a 20% rise in output per worker and a 36% rise in
> > total output. That includes a 46% increase in manufacturing
> > production.
> >
> > So the frenzied speculation did absolutely nothing to dampen real
> > investment and production. Nor should it. I don't know where the idea
> > comes from that speculation somehow crowds out real activity (at least
> > in any direct way).
>
> It comes from the wishful thinking of stagnationist Marxists!
I doubt it. I would assume that all available funds go to "real investment" AS LONG AS real investment is available. and the shift of funds into "bubbles" is evidence that real investment has reached its maximum under the given conditions so that there are surplus funds with no place to go except speculative activity. The evidence for this is precisely the evidence Seth gives: that the bubble did not detract from "real investment."
Don't you EVER get tired of replacing actual analysis with wild guesses as to the motives of people you don't even know?
Carrol