The Ascent of Money

http://video.google.com/videoplay?docid=-545930454338776455

http://www.channel4.com/history/microsites/A/ascent-of-money/index.html

well worth a look

the name rings a bell for sure, will check out later

word is that theres plenty more shit to hit the fan this year.... like serious deep dark brownness.

it may become the time to buy a few things during this next culmination/capitulation phase sometime in the middle of this year tho... not for the long run, just for the next corrective phase.

have torrented the first two episodes....

yep seems from my reading that we're only in the beginnings of what is to come... some scary articles about the pound all over brit media currently

are we about to witness the end of capitalism as we know it... I think we just might be

there's a 6 ep torrent somewhere apparently

definitely a 'lite' version for a while with govt regulation increasing.
During these phases capitalists are villified in society

UK Banking sector quite close to being fully nationalised. Royal Bank of Scotland announcint largest ever loss for a corporation in the UK at 25 Billion.

Bond market starting to show signs of its bubble bursting too... eg rising interest rates due to the need to attract capital to pay for all these stimulus packages. commodity deflation coupled with rising interest rates = stagflation.
Starting to increase now too is the fear of fiat currency's becoming worth less.

Interesting times...

will watch this series over the weekend.

Just on this topic - there is no "fully capitalist" economy in the same way there's no (successful) "fully socialist" economy. We all live in mixed economies so we are really going to see the rebalancing of that mix. Some of the beliefs in the controls built into the capitalist side of the mix will be reconsidered and the controlled side of the economy will intrude to fix them...

As we know it - sre there is going to be a lot of changes both in regulation and peoples habits/risk taking but to even associate this as substantive change in the concept of capitalism is a bit optimitic of you BD.

optinistic... yep... could be atime approaches when politicans listen to the people not the cashbooks and change that which is so wrong about our western way of life - the time is right, as to if we are up to it... depends on the fortitude of them that desire to lead

BD may be a bit optimistic thinking that this current situation is the one
But imo capitalism will destroy itself. And it will be in the aftermath of events similar to these that it will occur.
I make no prediction regarding what will transpire but it will be revolutionary.

(See I'm not a capitalist, I'm really a Marxist)

I found several aspect of this article interesting:

http://www.stwr.org/global-financial-crisis/winds-of-change.html


The length of the current crisis
"Western economies have been, to all intents and purposes, stagnant since the early 1970s, with a mere 2 per cent average annual growth, as opposed to 5 per cent between 1950 and 1970."

The shift from a culture that values work to one that values consumption
"Capitalism ticked along in one form or another until the 1950s because a broad middle and working class could be persuaded to accept a life in which most of one's labour went to reproducing it in the form of rent, food, clothes, etc, with a small amount for luxuries. What could keep people committed to such an endless, unchanging system? Only the notion that hard work was a value in itself; that thrift, modesty and meekness were virtues ... At some point, however, that approach has to be abandoned, because one of the problems it creates is a lack of demand ... At some point, the consumer power of workers, via higher wages, has to be stimulated, even if it means a fall in the rate of profit ... a major cultural change has to be engineered — one that promotes spending ... The cultural taboo on debt and profligacy, deeply internalised by earlier generations, is reversed."

Implications for the West of the rise of Asia
"China's low share in global GDP over the past two centuries has been an aberration created by imperialism. The East is on track to re-establish itself as the locus of one third to half of the world economy ... globalisation, when it becomes a genuinely global process, means that Western lifestyles simply cannot be sustained, as wages and the price of labour find a genuinely global level. With a billion people still to be drawn in from agriculture to industry in the East, and with those regions increasingly taking over more advanced types of work, there is an almost endless supply of people willing to work for wages that most of the West could not contemplate living on."

And this:

http://www.stwr.org/global-financial-crisis/the-new-depression.html


"While the US economy is contracting, China’s grew at roughly 9 per cent in 2008 and is projected to grow at about 6 per cent in 2009. Its banks, far from bankrupt like their US counterparts, are cash-rich. China enjoys a large current account surplus, the government’s finances are in good order and the national debt is small. This is a crisis that emanates from the US and whose impact on China has been essentially indirect, through the contraction of western markets. It is the American model that has failed, not the Chinese.

One of the factors that intensified the Great Depression, and indeed was part cause of it, was Britain's growing inability to continue in its role as the world's leading financial power, which culminated in the collapse of the gold standard in 1931. It was not until after the war, however, that the US became sufficiently dominant to replace Britain and act as the mainstay of a new financial system at the heart of which was the dollar.

The same kind of problem is evident now: the US is no longer strong enough to act as the world's financial centre, but its obvious successor, namely China, is not yet ready to assume that mantle. This will undoubtedly make the search for a global solution to the present crisis more difficult and more protracted."

I guess I am - it does spell the end of the US dominence of our global financial system with China to take over probably (in time)

Similar to when Britian lost that title to the US when the gold standard was dumped in 1931 and then eventually post WW2 the US became the dominante one

OneHappy - I'm reading a lot of similar articles, fascinating stuff

If you are really keen bob, try Giovanni Arrighi,'Money, Power, and the Origins of our Times.' Essentially a history of capitalism from the 14th Century to 1994. Theoretically very complex, but empirically a fascinating read as Arrighi traces world history, and relates economic, social and military events to the struggle for power between economic entities - European ones, that in order to exercise their power relative to one another dragged the entire world into struggles of their own making.

In that book Arrighi describes a series of what he calls systemic cycles of accumulation, in turn Geonese, Dutch, British and American, and then asks (in 1994), 'what next?' He looks at three scenarios:

1) The end of capitalism (as an economic system where there is global competition for capital) on the basis that the concentration of both capitalist (ie monetary) and territorialist (ie military) power in America is such that no new hegemonic power can emerge to lead the global economy. In this scenario, the American state gains power over capital to the exclusion of all others, resulting in a world empire. Note that the overall pattern of capitalist development is an increasing connection between money and state power. Genoa was little more than a renaissance city, and militarily it relied upon an alliance with Spain. The United Provinces of Holland never made it to the status of being a proper state (the best example of a state around the 17th century was France). Britain was a full nation state with a world empire, but militarily it never achieved the dominance of power that America has today.

2) The end of capitalism because neither America nor any other power is strong enough to lead a new systemic cycle of capitalist accumulation, resulting in a descent into 'systemic chaos', essentially a preponderance of war and civil war, much like Europe during the dark ages.

3) A revival of capitalism based upon the emergence of some new, probably Asian, economic power. In 1994 Arrighi looks to the Asian tiger economices as a possible 'capitalist archipeligo' who might achieve this. For a number of reasons this idea is dismissed.
In his recent book 'Adam Smith in Beijing' (2007), Arrighi (i think) looks to a possible rebirth of capitalism based upon Chinese foundations.

In Arrighi's words, the crisis of the 1970s was a 'signal crisis' for America (Britain's was the Depression of 1873-96). The crisis of today could well be a 'terminal crisis' (Britain's was the Great Depression and WWII). A characteristic of such times is the movement of capital away from production (because when there is excessive productive capacity returns are too low) to financial speculation - as has happened previously when hegemonic powers have been breathing their last - "periods of financial speculation have always been the sign of autumn".

Whoops, that Arrigh title is 'The Long Twentieth Century - Money, Power and the Origins of our Times'

cheers Onehappy, I will check it out - hopefully its not too technical as its a topic I can follow only so far as I'm a economics ignorant

Actually a read of reviews of 'Adam Smith in Beijing' suggests that Arrighi does in fact see the rise of China to signal potentially the end of capitalism, and its replacement by a non capitalist 'world-market society.' Note that for Arrighi capitalism is "the anti-market", dependant upon state power for its emergence, and survival.

On the difference between western capitalism and Chinese economic development:

"Arrighi believes that the developmental vectors ran in opposite directions in the East Asian and European system ... the East Asian system did not display a tendency towards geographical expansion and war-mongering ... it instead was aimed towards national market economy making. This market economy was supervised stronger by the Chinese central political power than its European counterparts, never rejecting “the Confucian ideal of social harmony in favor of a view of unfettered struggle in the market place.” Arrighi is not denying the presence of any capitalist group in China but he postulates that these capitalists were never able to promote their search for the accumulation of capital as the cornerstone of the national economic development. This is exactly what did happen in Europe, where both political power and economic wealth depended on long-distance trade and hence on each other. This created the synergy between militarism, capitalism and territorial expansion."

http://hsozkult.geschichte.hu-berlin.de/rezensionen/id=11321&count=7421&recno=1&type=rezbuecher&sort=beitraeger&order=up