[lbo-talk] What is the Crisis About? Fictitious Capital or the Destruction of Wealth?

SA s11131978 at gmail.com
Wed Mar 11 09:47:45 PDT 2009


michael perelman wrote:


> This short essay briefly describes the financial side of my
> interpretation that the crash reflected a disconnect between the
> underlying investment in the economy and its financial representation
> -- what Marx called fictitious capital. The stock market people call
> this realignment, "destruction of wealth," even though what is
> destroyed is the illusion of wealth. The illusion may have been
> capable of purchasing valuable things so long as other people accept
> that illusion.

I don't understand what the specific argument is here. Financial wealth is always an "illusion" under capitalism - when there's a crash and when there isn't a crash. So how can it explain this crash?

SA



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