Re: real rates

[Chris Burford <cburford@xxxxxxxxxx>]

At 27/06/01 11:58 -0700, Jim Devine wrote:
> as expected, the US Fed cut the Fed. Funds rate by 1/4 point. But here's a
> dimension ignored in most newspapers.
>
> L.A. TIMES/Wednesday, June 27, 2001
>
> By One Measure, Rates Are Near Zero


This may be a curiosity or it may be very revealing if properly analysed.
Another example of the particularity of contradiction.

I suspect the latter.

There is no reason why a society should not run on negative interest rates
for a time. After all precapitalist societies had good years and lean years
(as recently discussed in early China).

The important thing may be that there is still an interest rate, which
makes for a differential between borrower and lender. It would also be
consistent with a marxian view which does *not* put the main emphasis in
the analysis of capitalism on extracting reward from sums of capital.

The argument that comes to mind is that of Schweickart in "Against
Capitalism" about how investment is a positive sum game largely at the
expense of the non-players.

I have just checked the reference pages 40-41, but do not have time to type
it out or finally set up my scanner. For someone at a Jesuit university
Schweickart is most conscientious in squaring his argument with Marx, but I
am sure Jim would agree that creativity can flower in all sorts of places.

I have to get off to work, but I will try to quote it later today if I have
time, and no one else has.

Chris Burford

London