Eminent economist Prabhat Patnaik writes in the People's Democracy, providing in his usual lucid fashion, the whys, hows and wherefores of the financial crisis that has engulfed the United States' financial system. Article courtesy, "People's Democracy".
The global financial crisis must open the eyes of all those who have uncritically supported financial sector liberalisation. They should think about what would happen to the savings of ordinary people, the pensions of working people, and public investment — if India were subjected to the rapacious deregulated financial system prevalent in the United States. Prakash Karat elaborates.
Pragoti editorial team's Subhanil Chowdhury, analyses the current crisis in the international financial market
“When you trade pieces of paper for other pieces of paper instead of trading them for real things, one day someone wakes up and realises the paper’s worth nothing.” Therein lies the core of the biggest crisis faced by international capitalism for the last 75 years, to be precise since the beginning of World War II.
Courtesy: Hindustan Times
We the people must now seize the time! We have always had the capability of determining our own destiny, but for various reasons, the people failed to elect the leaders who provided the correct political will. There was always some corporate or private special interest that stood in the way of the public good. And they always seemed to have the power of the purse to throw around and influence public opinion or our elected officials. The very foundation of the U.S. economy is crumbling underneath our feet. This represents a unique moment in U.S. history and we must now seize the time for self-determination--for health care, education, ecological wisdom, justice, and all the policies that will make a difference in the lives of the people including an end to all wars, including the drug war!
Global capitalism has now entered a new phase, one that is unprecedented in its history. And the core of the capitalism – the US economy - has certainly entered uncharted territory particularly in the financial sector. The still-unfolding financial crisis has already gone way beyond the predictions of even relatively pessimistic observers, and now threatens actually to cause a financial collapse at the heart of the international economy.
THE super profits being reaped by international finance capital was often portrayed as a balloon that could inflate to infinity. The periodic crises like the collapse of the South Asian "Tigers" in the 1990s or the collapse of US hedge fund Long Term Capital Management a decade ago and the insolvencies of major financial giants in these years of the 21st century were all treated as minor ruptures that could be repaired like punctures in a tyre. Given the unsustainable character of globalisation, the balloon had to burst and that it did.
Contrary to its ideology of capitalism and market economy, the US government has, by force of circumstances, taken control of two heavily loss-making American mortgage companies, Fannie Mae and Freddie Mac, on September 7, 2008. By invoking “conservatorship” under a 1992 Law, the Bush administration has effectively passed on the losses suffered by the private companies, to the burden of American taxpayers.
Jayati Ghosh reviews works by George Soros and Philip Augar, insiders within Wall Street. Both writers point out to the asymmetry of information, and inherent imperfections in the system. Courtesy, The Asian Age newspaper.