> According to Fitch, a decline in profitable investment outlets generates
> "Formation of surplus capital hoards. Unable to return 'home' for
> productive re-investment, the surplus seeks to preserve itself by moving
> into financial channels."
>
> This point of confusion has been raised on the list before. In fact,
> Patrick repeated this notion when he linked to Brenner's interview a
> couple weeks ago. He wrote: "under conditions of overaccumulation...,
> there 'wasn't enough investment' in the 1980s-2000s, because of
> overinvestment in the prior era. Hence underinvestment in the real
> sector accompanied hyperinvestment in the financial sector."
>
> "Underinvestment in the real sector accompanied hyperinvestment in the
> financial sector." I think it's worth going over this fallacy again.
>
According to Matthew Nichter, Gerard Dumenil (mentioned earlier) doesn't agree with you:
'One of the authors’ most provocative findings regarding "financialization" is that the expansion of financial activity has retarded capital accumulation (the growth rate of the fixed capital stock). In both the U.S. and Europe, non-financial corporations’ investment in plant and equipment continues to be funded overwhelmingly through profits generated by their own non-financial production activities. Very little capital invested in the financial sector is ultimately routed to the non-financial sector, and non-financial firms’ own financial operations contribute virtually nothing to their productive capacity. In this respect, finance functions as a parasitic drain on the “real” economy.'
(from M.N.'s review of _Capital Resurgent_ http://jwsr.ucr.edu/archive/vol14/Nichter-vol14n1.pdf )
I know little about all that but I'm interested.
Yann