14 Oct 2008
After the deluge
love this from Keynes on the irrationality of speculative markets
[economics] deals with motives, expectations, psychological uncertainties. One has to be constantly on one’s guard against treating the material as constant and homogeneous. It is as though the fall of the apple to the ground depended on the apple’s motives, on whether it is worthwhile falling to the ground, and whether the ground wants the apple to fall, and on mistaken calculations on the part of the apple as to how far it was from the centre of the earth. (quoted in Moggridge 1976: 27)
Well looks like pretty drastic action has staved off a bank collapse, which would have meant no money in the cash point, savings wiped out, food riots, etc.
However severe recession is still on the cards and the worry is that the derivative boys (very few of them are girls) will be back to their old tricks in a year or two.
And of course we are all collective paying for the chaos of the market gone mad.
Certainly this is a time to be putting forward ecosocialist economic alternatives, the free market counter revolution needs to be over turned but top down centralised socialism and warmed up Keynesianism are not enough.
Certainly getting a lot of interest in alternatives...click here for the first couple of chapters of my last book on anti-capitalist economics.