>Rakesh Bhandari wrote: > >>The Fed is powerless to change this; fiscal policy can relieve >>realization problems but the resumption of private investments >>depends on the restoration of profitability through the devaluation >>of constant capital and a rising rate of surplus value. > >So, translating into demotic English - one of the most aggressive >easing streaks in Fed history will have no effect, and there will be >no recovery anytime soon? Are you expecting a long stagnation or a >deep depression? > >Doug
To the extent that the working class prevents the crisis from being resolved on its back, the longer the crisis will endure but the stronger the working class will be, organizationally speaking, to commence even more fundamental inroads into the system. Nothing is predetermined; prediction is strictly impossible. We are all Henwoodians now. I certainly don't think a painless working down of inventories will be enough to stimulate a strong new bout of investment; there has to be more destruction and devaluation of capital to encourage strong new levels of investment among the surviving capitals. There however will doubtless be a US recovery (some of that trillion dollars will come out of the money markets, assets will rise and investment on that basis) but I doubt that recovery will be strong enough to compensate for weakness in the system as a whole. If the crisis is not protracted in the US, we'll get bitten in the butt before long as a result of financial crises in Japan and Asia. rb
