Tuesday, August 28, 2007
Goldner's latest on capitalist crisis
For now, read this.
The liquidity crisis currently wiping billions off global stock markets is just the tip of a very big iceberg. Beneath the credit crunch and incipient insolvency crisis lie the economic and political crisis of the USA’s global reign, claims Loren Goldner. But will this mean global depression, wars and intensified authoritarianism, or a renewed opportunity for communism? Goldner returns to the theories of Marx and Luxemburg to examine today's financial and military imperialism, and its left wing ‘anti-imperialist’ mirror
In February of this year the Chinese stock market, which had long been suspected of being in a runaway bubble phase, took a plunge. In the following days that tremor was felt in stock markets around the world. China in recent months has reached the ‘shoe shine boy’ phase of popular stock speculation (a major American investor famously decided to get out of the stock market just before the 1929 crash when a shoeshine boy gave him advice on stocks), and after the (not so welcome) correction, the Chinese market resumed its upward rush to new highs, followed with relief by investors everywhere.
With the slightest historical perspective, we can see that the world shock set off by such a hiccup in a still relatively small market (in terms of what savvy people call ‘total market capitalisation’) is something quite new, unthinkable only a few years ago. China’s stock market can have such an impact because people are aware that any pause, not to say downturn in the country’s economic boom (averaging over 10 percent GDP growth for years on end, whereas Britain in its 19th century heyday was considered quite impressive at 3 or 4 percent) could bring the contemporary worldwide financial euphoria to an end. Increasingly insiders and pundits talk openly of the ‘when, not if’ of a global downturn, or even (for some) cataclysm.