[lbo-talk] Austerity In The Face Of Weakness

Patrick Bond pbond at mail.ngo.za
Tue Aug 31 21:13:16 PDT 2010


Doug Henwood wrote:
> On Aug 31, 2010, at 8:15 PM, Julio Huato wrote:
>
>
>> I'm not sure I understand why the profit rate would be irrelevant. It
>> seems to me that it's exactly the opposite. The profit rate is the
>> rate at which capital expands itself.
>>

What kind of capital? Productive? Financial? If the latter, the contradictions between real and fictitious capital can become debilitating, as expansion can mean simply bubbling.


> Not necessarily. It's the return on past investment. That return can be reinvested, hoarded, or consumed.
>

Or bubbled.

There was much confusion in the ranks of some Marxists (names available upon request) who believed that a revival of superficial profitability (failing to discount financial fluff) from the mid-1980s through 2007 meant there was no 'crisis' in the Marxian sense. Phew, did they get that wrong.

Cheers, Patrick



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