On 2/6/2011 10:23 AM, Marv Gandall wrote:
> The financialization of Western economies, characterized by engineered low interest rates and speculative investment in stocks, bonds, and a bewildering array of derivative products, was an outgrowth of the shrinkage of profitable investment opportunities in the "real" economy of plant, equipment, infrastructure and other hard assets.
This is the Harvey/Brenner/Fitch line. It's not what these authors are saying.
The new LRB has a good (and beautifully written) essay by Benjamin Kunkel giving a detailed precis of Harvey's argument. The linchpin of the chain of argument (as concerns current economic conditions) is this thesis. Unfortunately, the thesis doesn't make any sense - not only empirically but theoretically.
If there are fewer real investment opportunities, the result will be less real investment. It won't be more financial speculation.
SA