[lbo-talk] mobilization

[Doug Henwood]

One of the roots of the recent financial market turmoil is that Wall  
Street financed a lot of long-term mortgage lending by borrowing  
short-term in the commercial paper market; that meant that they had  
to refinance every few weeks to support a loan with a term of  
decades. Thanks to a Google alert on myself, I just learned that a  
blogger quoted me in Wall Street quoting Joseph Schumpeter: "It is  
one of the most characteristic features of the financial side of  
capitalist evolution so to 'mobilize' all, even the longest,  
maturities as to make any committment to a promise of future balances  
amenable to being in turn financed by any sort of funds and  
especially by funds available for a short time, even overnight, only.  
This is not mere technique. This is part of the core of the  
capitalist process." A nice antidote to all those who think that all  
this stuff is new.

Doug