Re: [Marxism] Soros: Obama must implement a radical and comprehensive set of policies

[D OC <donaloc@xxxxxxxxxxx>]

Interesting article here by Soros with some interesting insights on how CDSs 
reverse natural disincentives to shorting. However, he only just appears to 
have discovered that financial markets can be irrational and that bear runs can 
be self-validating.
 
It is of interest to see people like Soros question the very pillars of vulgar 
economy such as recognising 'reflexivity' and questioning the 'efficient market 
hypothesis'. But to my mind these still are only surface only explanations of 
the speed of the crash. CDSs and shorting only overcorrected downwards on an 
existing downward trend. 
 
Krugman's Keynesian prescriptions are more to the point. What's at issue here 
is a fundamental imbalance in the global economy. That isn't going to be fixed 
today or tomorrow. 
 
>From a political economy perspective, I am wondering if any articles are 
>around that would shed light on a question of some importance. I.e. whether 
>the ballooning and crunch of credit reflected primarily the ever growing 
>disconnect between the real economy (value) and the financial economy (money) 
>within the core economies or whether the ballooning of credit was necessary to 
>facilitate the imbalance in trade (seen in underlying value terms) between the 
>'third world' and the imperialist countries. 
 
I'm unclear on this, my political orientation made me blame the latter cause as 
it is obviously a massive problem but the question is really whether this was 
at the root of the credit ballooning itself. At this stage, the question is 
perhaps somewhat academic as the credit crunch (and deleveraging) has clearly 
impacted the possibility of maintaining a trade imbalance in the imperialist 
countries without a ballooning in debt.
 
I believe that all of this has massive strategic implications for revolution. 
The underlying economic conditions which underpin the aristocracy of labour are 
being removed. British new labour is now talking of a return to 
industrialisation and away from the financial services. The incoming US 
administration clearly are approaching social reformism. Things are looking up 
all around.
 
DoC
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