In a message dated 2/12/2002 2:18:34 PM Central Standard Time, [EMAIL PROTECTED] writes:
I had raised an objection to Fred's theory in 21987 and 99. I have
found that Samuel Hollander makes a similar criticism of Marx in his
classical Economics:
"The curve relating the profit rate and accumula
Davies, Daniel wrote:
> >We've been through this before, but much of the profits that, say,
>>Ford and GM earn from their finance subsidiaries come from financing
>>cars and trucks. So it's not speculative profit - they're making the
>>money the bankers used to make.
>
>Yeh, but it got big
>We've been through this before, but much of the profits that, say,
>Ford and GM earn from their finance subsidiaries come from financing
>cars and trucks. So it's not speculative profit - they're making the
>money the bankers used to make.
Yeh, but it got bigger by an order of magnitu
Really it should be expected future profits, but the current profit rate
is as good an indicator of expectations as we have. Robert Chirinko has
probably done the most on investment as a function of profit.
On Mon, Jan 28, 2002 at 01:33:48PM -0500, Doug Henwood wrote:
> Well, empirically speakin
- Original Message -
From: "Devine, James" <[EMAIL PROTECTED]>
To: <[EMAIL PROTECTED]>
Sent: Monday, January 28, 2002 12:23 PM
Subject: [PEN-L:22019] RE: Re: RE: Re: the profit rate & recession
my guess: both.
> Was it uncompetitive capital-labor ratio costs or the overvalued
> dollar
> >The profit rate that the BEA measures seems to be in the
> same general league
> >as the "marginal efficiency of investment" of Keynesian
> theory (or Marx's
> >rate of profit, for that matter). The MEI is compared to the
> interest rate,
> >so if MEI > i, the incentive to invest is there. I
>
>How you measuring accumulation? If you're measuring profitability in
>relative rather than absolute terms, shouldn't you measure
>accumulation relatively as well?
Doug,
I meant by accumulation what Jim D is (I believe) referring to as net
investment. I think I agree with Jim that the overco
ircal data support
this?
Cheers, Ken Hanly
- Original Message -
From: "Doug Henwood" <[EMAIL PROTECTED]>
To: <[EMAIL PROTECTED]>
Sent: Monday, January 28, 2002 12:33 PM
Subject: [PEN-L:22009] Re: Re: Re: Re: Re: Re: Re: the profit rate &
recession
> Well,
>Well, empirically speaking - which I know is embarrassingly vulgar -
>the best explanation for changes in investment is the change in
>profits. Marx's argument in this excerpt just doesn't sound right.
Doug,
I am not necessarily disagreeing. I am saying that as long as a
falling rate of profi
>Rakesh Bhandari wrote:
>
>>Why should capitalism be more vulnerable to recessions and
>>stagnation simply because the profit rate is falling or low?
>
>Low profits mean low investment, which means a slower rate of growth
>and reduced technical innovation. Profits are the main source of
>invest
Rakesh Bhandari wrote:
>Why should capitalism be more vulnerable to recessions and
>stagnation simply because the profit rate is falling or low?
Low profits mean low investment, which means a slower rate of growth
and reduced technical innovation. Profits are the main source of
investment fun
> >I raise a single question (and Doug your reply would doubtless be
> >most illuminating--am I way off here?):
> >
> > Why did the drop off in investment spending *lag behind* the drop
> >in profitability?
Doug writes:
> The financial mania, of course. There were plenty of outside funds to
>
Doug Henwood wrote:
>
>
> And when are those contradictions of capitalism that Rakesh is
> talking about really going to bite? I mean something more than a
> nibble. The phrase has been around for what, like a century?
>
They've been biting every second of every day for several hundred years
>Michael Perelman wrote:
>>
>>
>>
>> Fred's approach of looking at profits makes a great deal of sense when
>> looking at long swings, but in the short run -- as to what causes a
>> particular downturn -- identification is still a problem.
>>
>
>What is the political importance of understanding
Doug, that I think that the big capitalists do understand their interest.
The small ones to whom the Wall Street Journal appeals on their editorial
page do not. We were just discussing yesterday how major businesspeople
appreciate Marxist analysis.
On Tue, Jan 15, 2002 at 02:15:22PM -0500, Doug
Michael Perelman wrote:
>
>
>
> Fred's approach of looking at profits makes a great deal of sense when
> looking at long swings, but in the short run -- as to what causes a
> particular downturn -- identification is still a problem.
>
What is the political importance of understanding the ec
I don't consider myself a social democrat, but I agree with Jim -- if I
understand him correctly. SD is good for the capitalists. That does not
make it the Valhalla for others. It is merely a social form that reduces
conflict and thus improves efficiency.
On Tue, Jan 15, 2002 at 10:03:26AM -08
Rakesh, please don't try to classify others on the list. Let Jim speak for
himself as to whether he is a social democrat or not, if he chooses to do
so.
As to untangling causes, it is hard to say. I recall that the CEO of Ford
wondered how the industry could deal with overcapacity -- this was so
Jim D attempts to assure us:
>
>actually, it's not an "argument" in the sense of a "quarrel" (and definitely
>not a "contradiction" à la Monty Python). It's a discussion. (In this
>thread, I had a argument with someone else. Or was it a contradiction?
>Whatever, it was a waste of time.)
But Jim
Devine, James wrote:
>Hasn't he also said that consumer spending is what's been holding up the
>U.S. economy? My point -- and that of Godley & Izureta, who also go beyond
>surface appearances to think about the determinants of private-sector
>spending -- is that this prop can't last. Similarly, E
Fred M. writes: > I agree completely that the causes of this recession have
little to do with consumption (at least so far), and have mostly to do with
falling profits and investment. This is the main point I have been arguing
in my discussion with Jim D.<
actually, it's not an "argument" in the
I am having a problem with this discussion. Marx, for me, is wholistic.
To say that profits, consumption, or investment causes a crisis seems
problematical -- since all are interconnected and enmeshed with
expectations.
Am I missing something?
--
Michael Perelman
Economics Department
Californ
>Devine, James wrote:
>
>>Rakesh writes: >Doug H and Fred M have both argued that spike of
>>profit rate (as conventionally measured) especially in the 90s was
>>a result influx of foreign capital, which reduced borrowing costs. <
>>
>>I missed this. I don't know what Doug and Fred argue here, b
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