[lbo-talk] Staunch the rhetorical bleeding

[C. G. Estabrook]

Doug Henwood wrote:
> 
> On Oct 9, 2008, at 2:26 PM, C. G. Estabrook wrote:
> 
>> The crisis (literally, a separation) seems to consist of the refusal 
>> of those who own or control money to lend it (it's useless to point 
>> out that "loan" is not a verb) unless they're paid more.
> 
> No. They're not demanding higher interest rates. Interest rates on 
> interbank loans - which are largely fictitious, since so little lending 
> is going on - are quite high. It's that no one wants to lend the money 
> *at any price*. They're too worried about getting the principal back.

But having the risk -- which they're supposedly being paid for by the interest 
-- removed is surely much the same as being paid more.  Capital's gone on strike 
for better working conditions, if you'll pardon the metaphor...


>>  They surely have the money: e.g., the WSJ pointed out the other day 
>> that "Exxon has $39 billion in cash and has been buying back shares at 
>> an $8 billion-a-quarter clip; the value of the stock it has 
>> repurchased is about $218 billion, a shade less than the current value 
>> of General Electric Co."
> 
> Last I checked, Exxon is not a bank. So the state of their balance sheet 
> isn't really relevant to the crisis.

The point is that the money's out there somewhere. We need to give a good 
(non-metaphorical) account of why it's not being "loaned."  --CGE