[lbo-talk] Stock Markets vs the Real Economy

SA s11131978 at gmail.com
Tue Aug 9 12:47:45 PDT 2011


On 8/9/2011 2:58 PM, socialismorbarbarism wrote:


> SA: "This is the problem: You are confusing production with distribution."
>
> What wall did this bounce off of?
>
> "A larger share of *profits* goes to the financial sector than in the past.
> That does not mean a larger share of *productive resources* has been
> shifted into the financial sector."
>
> Sure. So? Is someone on this list seriously arguing otherwise? If so I
> admit to missing it.
>
> "The chart I posted ..."
>
> This is either not part of this thread or so far back I can't easily
> find it. At any rate it's not what I was answering.

Okay, maybe there's confusion about which arguments each of us is responding to.

As I understood it, you were responding to Doug's post - which was a response to Chuck's argument that "The main point was that manufacturing giants can shift billions from the making-something division low profit to the finance division higher profit."

If this shift Chuck is talking about were a general phenomenon, you would find that aggregate investment and employment have been shifting from the non-finance industries to the finance industry.

Instead, the finance share of investment and employment looks like this - a chart I posted today: http://bit.ly/nsdCj0

I apologize if my tone was brusque. This is all related - in my mind, anyway, but not necessarily for everybody else - to something I've been saying for a long time. Which is that David Harvey and Robert Brenner have been making an argument, repeated by others, that financial growth is a symptom or a correlate of a stagnating real sector.

What annoys me isn't that I think they're wrong. Who knows, maybe it's me who's wrong - and besides it's not in itself a topic worth getting worked up about. What annoys me is that it keeps getting repeated despite a lack of evidence and an abundance of counter-evidence. It's as if evidence doesn't matter - if it feels good, say it.

SA



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