,CR$IT ,CRUN*3 ,! RETURN ( DEPRESSION8 

,PEOPLE 3 

,AU?OR 3 ,IA9 ,MC,KAY 

,TEXT 3 

,BR[N IS N[ DISCOV]+ ?AT PROCLAIM+ ! 5D ( 0,BOOM & ,BU/0 DOES NOT1 9 FACT1 MEAN MU*4 ,! AMAZ+ ?+ AB\T ! CURR5T ECONOMIC PANICK+ IS NOT ?AT IT IS HAPP5+ BUT ?AT SOME PEOPLE SEEM SURPRIS$ BY IT4 ,:ILE ON ! WAY UP MANY 0EXP]TS0 SEEM TO =GET IT1 CAPITALISM HAS ALWAYS BE5 M>K$ BY A BUS9ESS CYCLE4 

,DUR+ ! GOOD TIMES1 IT IS PROCLAIM$ ) SADLY PR$ICTABLE REGUL>ITY ?AT ?IS UPSW+ WILL BE P]MAN5T & ! BUS9ESS CYCLE HAS COME TO AN 5D 7AS 9 ! #a#i#iS1 #a#i#hS1 #a#i#gS1 #a#i#fS & SO ON74 ,AS BAD TIMES APPROA*1 IT IS PROCLAIM$ ) EQUAL PR$ICTABILITY ?AT ! 0FUNDAM5TALS0 >E 0GOOD0 & ! ECONOMY IS 0/RONG40 ,!N ! CRISES HAPP5S 7AS 9 ! E>LY #bS1 LATE #a#i#iS1 LATE #a#i#hS1 & SO ON74 ,& BAD TIMES DO SEEM TO BE APPROA*+444 

,! RESPONSE ( \R POLITICAL RUL]S TO ! LOOM+ F9ANCIAL CRISIS IS TO BE EXPECT$ - BAIL\TS A PL5TY = ! FEW :OSE ACTIONS GOT !M 7& US7 9TO ?IS MESS4 ,COMP>E ?IS 9/ANT 9T]V5TION = ! ELITE ) ! RESPONSE = ?OSE AT ! BOTTOM4 ,= EXAMPLE1 :ILE VISIT+ TORNADO-RAVAG$ ,T5NESSEE AFT] ! CR$IT CRUN* BECAME P>T ( ! G5]AL LANGUAGE ,BU% HAD !SE HELPFUL WORDS = ?OSE AFFECT$3 0,Y\ KN[1 LIFE SOMETIMES IS1 UH1 Y\ KN[1 IS UNFAIR1 & Y\ DON'T GET TO PLAY ! H& ?AT Y\ WANT$ TO PLAY40 ,COMP>E ?IS TO ! RESPONSE AFT] ! 0,BLACK ,MONDAY0 ( #b#h1 :I* SAW ,G,B,P#g#gBN WIP$ (F ,LONDON %>E VALUES ) SIMIL> DROPS ON ,WALL ,/REET4 ,!N IT WAS A CASE ( DRA/IC EM]G5CY CUTS 9 9T]E/ RATES & 0SIMULATION0 PACKAGES & BAIL\TS4 

,SO1 IF Y\ >E P>T ( ! ELITE !N Y\ %\LD GET LAVI% GOV]NM5T HELP & TAX CUTS RA!R ?AN ACCEPT ! CONSEQU5CES ( Y\R ACTIONS4 ,IF Y\ >E A WORK+ CLASS ,AM]ICAN :O HAS ! MIS=TUNE TO BE 9 ! WAY ( A TORNADO OR HURRICANE1 WELL1 ?AT IS JU/ LIFE & EV]YONE KN[S ?AT LIFE IS UNFAIR444 

,:5 WORK+ CLASS PEOPLE HAVE !IR LIVES ?R[N 9TO TURMOIL DUE TO RIS+ UNEMPLOY$ WE >E SAGELY 9=M$ ?AT CAPITALISM IS FUNCTION+ AS IT %\LD4 ,IF ! COMM5TATOR WANTS TO APPE> KN[L$GEABLE !N SU* EXPRESSIONS AS ,S*UMPET]'S 0CREATIVE DE/RUCTION0 WILL BE US$ TO %[ ?AT SU* TURMOIL IS = ! BE/ AS IT ALL[S 0! ECONOMY0 TO RESPOND QUICKLY TO *ANG+ CONDITIONS4 ,TO HAVE A WELF>E /ATE TO MAKE UNEMPLOYM5T MORE BE>ABLE W\LD ONLY H9D] ! 0EFFICI5CY0 ( ! M>KETS & SO %\LD BE OPPOS$ BY ALL RI<T-?9K+ PEOPLE4 ,IT MAY BE H>D = ! WORK]S & !IR FAMILIES1 BUT IT IS NECESS>Y4 ,/RANGELY1 :5 IT IS P>T ( ! RUL+ ELITE 7EXECUTIVES1 /OCK DEAL]S1 R5TI]S7 :I* FACE ! SAME 0CREATIVE DE/RUCTION0 & !IR 9COME FALLS1 GLOBAL CAPITALISM IS BROK5 & NE$S TO BE FIX$4 

,SOME GOOD NEWS1 ?\<4 ,AM]ICANS WILL N[ NOT HAVE TO LI/5 TO ,REPUBLICAN ,PRESID5TIAL C&IDATES YAKK+ ON AB\T PRIVATE ,SOCIAL ,SECURITY ACC\NTS OR AB\T 9VE/+ P>T ( ,SOCIAL ,SECURITY FUNDS 9 ! /OCK M>KET4 ,! BAD NEWS IS ?AT1 AS USUAL1 !Y & ! ,BU% ,JUNTA WILL >GUE ?AT TAX CUTS = ! WEAL?Y >E ON ! C>DS4 ,?IS IS UNSURPRIS+1 AS ! ,REPUBLICANS1 9CLUD+ ! ,BU% ,JUNTA1 HAVE LONG TAK5 ! VIEW ?AT TAX CUTS 7ESPECIALLY P]MAN5T TAX CUTS = ! RI*7 >E ! BE/ 9 EV]Y SITUATION4 ,DUR+ ! #b ELECTION CAMPAIGN1 TAX CUTS W]E JU/IFI$ BECAUSE ( ! BUDGET SURPLUS ACCUMULAT$ UND] ,CL9TON4 ,SO TAX CUTS 7= ! WEAL?Y7 >E NECESS>Y BECAUSE ( ECONOMIC GOODS TIMES4 ,!N1 9 #b#a1 ,BU% US$ ! IMP5D+ RECESSION AS AN EXCUSE TO CUT TAXES = UPP]-9COME ,AM]ICANS4 ,SO TAX CUTS 7= ! WEAL?Y7 >E NECESS>Y BECAUSE ( ECONOMIC BAD TIMES4 ,! SAME 0LOGIC0 IS AT WORK N[4 

,CLE>LY1 ! CUTS W]E_/>E NEV] 9T5D$ TO /IMULATE ! ECONOMY & :AT IMPACT !Y HAD WAS LIMIT$4 ,?IS IS UNSURPRIS+1 AS ! RATIONALE IS TO BOO/ 9VE/M5T & :I* SANE COMPANY W\LD DO SO 9 A DECL9+ M>KET 7P>TICUL>LY ONE CAUS$ BY OV]-9VE/M5T74 ,TO KEEP ! ECONOMY GO+1 ! ,F$]AL ,RES]VE 7& ,BANK ( ,5GL&7 WAS =C$ TO L[] 9T]E/ RATES & !N IGNORE ?AT BANKS />T$ TO L5D RECKLESSLY4 ,! ECONOMY WAS KEPT GO+ ON BORR[$ MONEY & BORR[$ TIME4 ,KEYNESIAN /ATE DEM& MANAGEM5T WAS SUPPLEM5T$ BY ITS ATOMIZ$ V>IATION1 9DIVIDUAL BORR[+4 ,LUCKILY1 ) 9EQUALITY EXPLOD+ S9CE ! #a#i#hS ! RI* HAD MORE MONEY TO SP5D1 SO WORK+ CLASS FAMILIES C\LD BORR[ AT HI< 9T]E/ RATES FROM ! WEAL?Y 7& TAKE MORE ?AN ONE JOB7 TO MA9TA9 !IR LIV+ /&>DS :I* W]E BE+ ]OD$ BY WEAL? FL[+ UPW>DS 7AS SE5 BY RIS+ 9EQUALITY74 

,RE/ ASSUR$1 ?\<1 BY WORK+ H>D] = LONG] N[ HI<] /OCK M>KETS W\LD MEAN !IR P5SION S*EMES W\LD BE HI<] LAT]4 ,BUT1 UN=TUNATELY1 ! /OCK & H\S+ M>KET BUBBLES HAVE EXPLOD$ ?AT FA9T POSSIBILITY4 ,?AT*] & ,REAGAN MANAG$ TO CONV9CE MANY PEOPLE 7NOT ONLY 9 ! SO-CALL$ MIDDLE CLASS7 ?AT IF Y\ %OVEL 5\< CA% 9TO ! POCKETS ( ! WEAL?Y1 :AT TRICKLES \T ( !IR OV]FL[+ POCKETS WILL 5RI* !M AS WELL4 ,?AT HAS NOT HAPP5$1 9 FACT ! RESULTS ( MAK+ 0ACTUALLY EXI/+0 CAPITALISM MORE LIKE ! IMPOSSIBLE MODELS ( ! ECONOMIC TEXTBOOKS HAVE BE5 LESS ?AN WOND]FUL4 

,! FACTS >E ?AT 9 SPITE ( MANY 0RE=MS0 CAPITALISM IS NOT 9 GREAT %APE4 ,GR[? HAS FALL5 /EADILY EA* DECADE1 ) ! #a#i#hS WORSE ?AN ! #a#i#gS1 ! #a#i#iS WORSE ?AN ! #a#i#hS & SO ON4 ,& ?IS IS AV]AGE GR[?1 SO RIS+ 9EQUALITY MEANS ?AT ! LIV+ /&>DS ( ! MANY >E LESS ?AN ?AT 7:I* MAKES DEBT SEEM MORE APPEAL+ TO MA9TA9 !M74 ,NEO-LIB]AL CAPITALISM HAS BE5 GIV5 ! APPE>ANCE ( SUCCESS BY ! V>I\S BUBBLES ! 0LIB]ATION0 ( ! F9ANCE M>KETS HAS PRODUC$4 ,! #a#i#iS 0BOOM0 WAS1 = EXAMPLE1 PREMIS$ ON ! DOT4COM BUBBLE1 QUICKLY FOLL[$ BY ! H\S+ BUBBLE4 ,9 FACT1 ! ,U,S /ATE HAS 9T]V5$ TO RESCUE ! ,AM]ICAN F9ANCIAL SY/EM FROM F\R CRISES DUR+ ! NEO-LIB]AL P]IOD3 ! DEBT CRISIS & 0SAV+S & LOAN0 CRISES ( ! #a#i#hS1 ! DOT4COM BUBBLE ( ! #a#i#iS2 & N[ ! SUBPRIME & CR$IT CRISIS4 

,! ORIG9S ( ! CRISIS 

,SO :AT CAUSES CRISES8 ,! BUS9ESS CYCLE IS A PRODUCT ( CAPITALI/ PRODUCTION & ! SOCIAL RELATION%IPS IT CREATES4 ,! NE$ = ! CAPITALI/ TO MAKE A PR(IT FROM ! WORK]S !Y EMPLOY IS ITS UND]LY+ CAUSE4 ,IF ! CAPITALI/ CLASS CANNOT MAKE 5\< SURPLUS VALUE 7PR(IT1 9T]E/1 R5T7 !N IT WILL /OP PRODUCTION1 SACK PEOPLE1 RU9 LIVES & COMMUNITIES UNTIL SU* TIME AS 5\< CAN ONCE AGA9 BE EXTRACT$ FROM WORK+ CLASS PEOPLE4 

,SO :AT 9FLU5CES ! LEVEL ( SURPLUS VALUE8 ,!RE >E TWO MA9 CLASSES ( PRESSURE ON SURPLUS VALUE PRODUCTION1 :AT WE WILL CALL ! 0SUBJECTIVE0 & 0OBJECTIVE40 ,! 0SUBJECTIVE0 PRESSURES >E TO DO ) ! NATURE ( ! SOCIAL RELATION%IPS CREAT$ BY CAPITALISM1 ! RELATIONS ( DOM9ATION & SUBJECTION :I* >E ! ROOT ( EXPLOITATION & ! RESI/ANCE TO !M4 ,9 O!R WORDS ! SUBJECTIVE PRESSURES >E ! RESULT ( ! FACT ?AT 0PROP]TY IS DESPOTISM0 7TO USE ,PR\DHON'S EXPRESSION7 & >E A PRODUCT ( ! CLASS /RUGGLE4 ,! OBJECTIVE PRESSURES >E RELAT$ TO H[ CAPITALISM WORKS & FALL 9TO TWO PROCESSES4 ,! FIR/ IS ! WAY 9 :I* M>KETS DO NOT PROVIDE 5\< 9=MATION TO PRODUC]S AVOID DISPROPORTIONALITIES )9 ! M>KET4 ,9 O!R WORDS1 ?AT ! M>KET REGUL>LY PRODUCES SITUATIONS :]E !RE IS TOO MU* PRODUC$ = SPECIFIC M>KETS LEAD+ TO SLUMPS4 ,! SECOND OBJECTIVE FACTOR IS OV]-9VE/M5T1 :5 IT IS CAPITAL GOODS :I* >E OV] PRODUC$4 

,ALL ?REE FACTORS OP]ATE TOGE!R 9 A REAL ECONOMY & WE HAVE DIVID$ !M PURELY TO HELP %[ ! ISSUES 9VOLV$ 9 EA* ONE4 ,! CLASS /RUGGLE1 M>KET 0COMMUNICATION0 CREAT+ DISPROPORTIONALITIES & OV]-9VE/M5T ALL 9T]ACT4 ,DUE TO ! NE$S ( ! 9T]NAL 7CLASS /RUGGLE7 & EXT]NAL 79T]-COMPANY7 COMPETITION1 CAPITALI/S HAVE TO 9VE/ 9 NEW MEANS ( PRODUCTION4 ,AS WORK]S' P[] 9CREASES DUR+ A BOOM1 CAPITALI/S 9NOVATE & 9VE/ 9 ORD] TO TRY & C\NT] IT4 ,SIMIL>LY1 TO GET M>KET ADVANTAGE 7& SO 9CREAS$ PR(ITS7 OV] !IR COMPETITORS1 A COMPANY 9VE/S 9 NEW MA*9]Y4 ,:ILE ?IS HELPS 9CREASE PR(ITS = 9DIVIDUAL COMPANIES 9 ! %ORT T]M1 IT LEADS TO COLLECTIVE OV]-9VE/M5T & FALL+ PR(ITS 9 ! LONG T]M4 ,MOREOV]1 DUE TO LACK ( EFFECTIVE COMMUNICATION )9 ! M>KET CAUS$ BY ! PRICE ME*ANISM FIRMS RU% TO PRODUCE MORE GOODS & S]VICES 9 SPECIFIC BOOM M>KETS1 SO LEAD+ TO OV]-PRODUCTION & ! RESULT+ GLUTS RESULT 9 SLUMPS DUE TO 9VE/M5T BECOM+ CONC5TRAT$ 9 C]TA9 P>TS ( ! ECONOMY4 ,RELATIVE OV]-9VE/M5T CAN OCCUR1 9CREAS+ & COMP\ND+ ANY EXI/+ T5D5CIES = OV]-PRODUCTION & SO CREAT+ ! POSSIBILITY ( CRISIS4 

,MEAN:ILE1 AS UNEMPLOYM5T FALLS WORK]S' P[]1 CONFID5CE & WILL+NESS TO /& UP = !IR RI<TS 9CREASES1 CAUS+ PR(IT M>G9S TO BE ]OD$ AT ! PO9T ( PRODUCTION4 ,?IS HAS ! IMPACT ( R$UC+ T5D5CIES TO OV]-9VE/ AS WORK]S RESI/ ! 9TRODUCTION ( NEW TE*NOLOGY & TE*NIQUES4 ,! HI<] WAGES ALSO MA9TA9 & EV5 9CREASE DEM& = ! F9I%$ GOODS & S]VICES PRODUC$1 ALL[+ FIRMS TO REALIZE ! POT5TIAL PR(ITS !IR WORK]S HAVE CREAT$4 ,RIS+ WAGES1 !RE=E1 H>MS ! POT5TIAL = PRODUC+ PR(ITS BY 9CREAS+ CO/S YET IT 9CREASES ! POSSIBILITY = REALIZ+ PR(ITS ON ! M>KET AS FIRMS CANNOT MAKE PR(ITS IF !RE IS NO DEM& = !IR GOODS & !IR 9V5TORIES ( UNSOLD GOODS PILE UP4 ,9 O!R WORDS1 WAGES >E CO/S = ANY SPECIFIC FIRM BUT ! WAGES O!R COMPANIES PAY >E A KEY FACTOR 9 ! DEM& = :AT IT PRODUCES4 ,?IS CONTRADICTORY EFFECT ( CLASS /RUGGLE MAT*ES ! CONTRADICTORY EFFECT ( 9VE/M5T4 ,JU/ AS 9VE/M5T CAUSES CRISIS BECAUSE IT IS USEFUL1 ! CLASS /RUGGLE BO? H9D]S OV]-ACCUMULATION ( CAPITAL & MA9TA9S AGGREGATE DEM& 7SO PO/PON+ ! CRISIS7 :ILE AT ! SAME TIME ]OD+ CAPITALI/ P[] & SO PR(IT M>G9S AT ! PO9T ( PRODUCTION 7SO ACCEL]AT+ IT74 

,& WE %\LD NOTE ?AT !SE FACTORS WORK 9 REV]SE DUR+ A SLUMP1 CREAT+ ! POT5TIAL = A NEW BOOM4 ,SO1 EV5TUALLY ! SLUMP WILL 5D 7CAPITALISM WILL NOT SELF-DE/RUCT DUE TO 9T]NAL ECONOMIC PROCESSES74 ,! 9CREAS$ SURPLUS VALUE PRODUCTION MADE POSSIBLE BY HI< UNEMPLOYM5T IS 5\< RELATIVE TO ! 7R$UC$7 FIX$ CAPITAL /OCK TO 9CREASE ! RATE ( PR(IT4 ,?IS 5C\RAGES CAPITALI/S TO />T 9VE/+ AGA9 & A BOOM BEG9S 7A BOOM :I* CONTA9S ! SE$S ( ITS [N 5D74 ,H[ LONG ?IS PROCESS TAKES CANNOT BE PR$ICT$ 9 ADVANCE 7:I* IS :Y ,KEYNES /RESS$ ?AT 9 ! LONG RUN WE >E ALL DEAD74 ,IT DEP5DS ON OBJECTIVE CIRCUM/ANCES1 H[ EXCESSIVE ! PREC$+ BOOM WAS1 GOV]NM5T POLICY & H[ WILL+ WORK+ CLASS PEOPLE >E TO PAY ! CO/S = ! CAPITALI/ CRISIS4 

,?US SUBJECTIVE & OBJECTIVE FACTORS 9T]ACT & C\NT]ACT ) EA* O!R1 BUT 9 ! 5D A CRISIS WILL RESULT SIMPLY BECAUSE ! SY/EM IS BAS$ UPON WAGE LABOR & ! PRODUC]S >E NOT PRODUC+ = !MSELVES4 ,ULTIMATELY1 A CRISIS IS CAUS$ BECAUSE CAPITALISM IS PRODUCTION = PR(IT & :5 ! CAPITALI/ CLASS DOES NOT 7COLLECTIVELY7 GET A SUFFICI5T RATE ( PR(IT = :ATEV] REASON !N A SLUMP IS ! RESULT4 ,IF WORK]S PRODUC$ = !MSELVES1 ?IS DECISIVE FACTOR W\LD NOT BE AN ISSUE AS NO CAPITALI/ CLASS W\LD EXI/4 ,UNTIL ?AT HAPP5S ! BUS9ESS CYCLE WILL CONT9UE1 DRIV5 BY 0SUBJECTIVE0 & 0OBJECTIVE0 PRESSURES -- PRESSURES ?AT >E RELAT$ DIRECTLY TO ! NATURE ( CAPITALI/ PRODUCTION & ! WAGE LABOR ON :I* IT IS BAS$4 ,:I* PRESSURE WILL PR$OM9ATE 9 ANY GIV5 P]IOD WILL BE DEP5D5T ON ! RELATIVE P[] ( CLASSES4 

,ONE WAY TO LOOK AT IT IS ?AT SLUMPS CAN BE CAUS$ :5 WORK+ CLASS PEOPLE >E 0TOO /RONG0 OR 0TOO WEAK40 ,! =M] MEANS ?AT WE >E ABLE TO R$UCE ! RATE ( EXPLOITATION1 SQUEEZ+ ! PR(IT RATE BY KEEP+ AN 9CREAS$ %>E ( ! SURPLUS VALUE WE PRODUCE4 ,! LATT] MEANS WE >E TOO WEAK TO /OP 9COME DI/RIBUTION BE+ %IFT$ 9 FAVOR ( ! CAPITALI/ CLASS1 :I* RESULTS 9 OV]-ACCUMULATION & R5D]+ ! ECONOMY PRONE TO A FAILURE 9 AGGREGATE DEM&4 ,! #a#i#fS & #a#i#gS >E ! CLASSIC EXAMPLE ( :AT HAPP5S :5 0SUBJECTIVE0 PRESSURES PR$OM9ATE :ILE ! #a#i#bS & #a#i#cS %[ ! 0OBJECTIVE0 ONES AT WORK4 

,IT IS FAIR TO SAY1 ?IS CRISIS 7LIKE ALL ! PO/ #a#i#hS ONES7 IS A PRODUCT ( 0OBJECTIVE0 FACTORS4 ,! DETA*M5T ( WAGES FROM PRODUCTIVITY GR[? S9CE ! #a#i#hS %[S ?IS1 AS DOES ! FACT ?AT ! ,BUREAU ( ,LABOR ,/ATI/ICS %[S A RADICAL DECL9E 9 /RIKES & WORK /OPPAGES4 ,!RE IS VIRTUALLY NO WORK TIME IS LO/ TO 9DU/RIAL CONFLICT 9 ! ,U,S,A &1 UNSURPRIS+LY1 AS WORK]S HAVE 9CREAS+LY LO/ !IR CAPACITY = COLLECTIVE 9DU/RIAL ACTION1 ! %>E ( NATIONAL 9COME GO+ TO WAGES & SAL>IES HAS FALL54 ,ACCORD+ TO ! ,C5T] ON ,BUDGET & ,POLICY ,PRIORITIES 0! %>E ( NATIONAL 9COME GO+ TO WAGES & SAL>IES 9 #bf WAS AT ITS L[E/ LEVEL ON RECORD1 ) DATA GO+ BACK TO #a#i#b#i4 ,! %>E ( NATIONAL 9COME CAPTUR$ BY CORPORATE PR(ITS1 9 CONTRA/1 WAS AT ITS HI<E/ LEVEL ON RECORD40 7,AVIVA ,>ON-,D9E & ,ISAAC ,%APIRO1 ,%>E ( ,NATIONAL ,9COME ,GO+ ,TO ,WAGES ,& ,SAL>IES ,AT ,RECORD ,L[ ,9 #b#f3 ,%>E ( ,9COME ,GO+ TO ,CORPORATE ,PR(ITS AT ,RECORD ,HI<1 #bi ,M>* #b#g7 ,! %>E ( WAGES & SAL>IES 9 ,U,S ,NATIONAL 9COME WAS AT ITS L[E/ LEVEL ON RECORD1 L[] ?AN 9 #aibi :5 RECORDS BEGAN 7#e#a4#f.0 VS4 #e#c4#f.074 ,?IS IS EV5 WORSE ?AN IT LOOKS1 AS 0WAGES & SAL>IES0 9CLUDES ,C,E,O PAY 7:I* HAS EXPLOD$ S9CE ! #a#i#hS74 ,CORPORATE PR(ITS >E AT #a#c4#h.0 7#a#a4#e.0 9 #a#i#b#i74 

,9 SPITE ( ?IS FALL 9 CLASS /RUGGLE & ! CORRESPOND+ BOL/]+ ( PR(ITS1 CAPITALISM IS FAC+ A CRISIS4 ,?IS IS :]E F9ANCE CAPITAL COMES 94 

,! CR$IT CRUN*444 

,:ILE SURPLUS VALUE IS ULTIMATELY CREAT$ 9 PRODUCTION1 ?IS DOES NOT MEAN ?AT F9ANCE CAPITAL HAS NO IMPACT ON ! CYCLE4 ,ITS ROLE IS IMPORTANT & CAN HEI<T5 A BOOM & DEEP5 A SLUMP4 ,:ILE F9ANCE CAPITAL IS DEP5D5T ON 9DU/RIAL CAPITAL1 IT %APES H[ ?AT DEVELOPS4 ,9 GOOD TIMES1 IT CAN ADD TO 9VE/M5T4 ,9 BAD TIMES1 IT CAN /OP IT AS CR$IT DRIES UP - ! SO-CALL$ 0CR$IT CRUN*40 

,:Y DOES ! CR$IT CRUN* HAPP58 ,TO UND]/& :Y1 WE NE$ TO TURN TO ! IDEAS ( ! NOT$ ,PO/-,KEYNESIAN ECONOMI/ ,HYMAN ,M9SKY4 ,HE CREAT$ AN ANALYSIS ( ! F9ANCE & CR$IT M>KETS :I* GIVES AN 9SI<T 9TO :Y BANKS CREATE CR$IT MONEY 7I4E4 LOAN+ MORE MONEY ?AN AVAILABLE SAV+S7 & :Y IT BECOMES UN/UCK4 ,?IS MODEL IS USUALLY CALL$ 0,! ,F9ANCIAL ,9/ABILITY ,HYPO!SIS40 

,LET US ASSUME ?AT ! ECONOMY IS GO+ 9TO ! RECOV]Y P]IOD AFT] A CRA%4 ,9ITIALLY FIRMS W\LD BE CONS]VATIVE 9 !IR 9VE/M5T :ILE BANKS W\LD L5D )9 !IR SAV+S LIMIT & TO L[-RISK 9VE/M5TS4 ,9 ?IS WAY ! BANKS DO 5SURE ?AT ! AM\NT ( CR$IT AVAILABLE REFLECTS ! AM\NT ( SAV+S4 ,H[EV]1 ?IS COMB9ATION ( A GR[+ ECONOMY & CONS]VATIVELY F9ANC$ 9VE/M5T MEANS ?AT MO/ PROJECTS SUCCE$ & ?IS GRADUALLY BECOMES CLE> TO MANAG]S_/CAPITALI/S & BANK]S4 ,AS A RESULT1 BO? MANAG]S & BANK]S COME TO REG>D ! PRES5T RISK PREMIUM AS EXCESSIVE4 ,NEW 9VE/M5T PROJECTS >E EVALUAT$ US+ LESS CONS]VATIVE E/IMATES ( FUTURE CA% FL[S4 ,?IS IS ! F\NDATION ( ! NEW BOOM & ITS EV5TUAL BU/4 ,9 ,M9SKY'S WORDS1 0/ABILITY IS DE/ABILIZ+40 

,AS ! ECONOMY />TS TO GR[1 COMPANIES 9CREAS+LY TURN TO EXT]NAL F9ANCE & !SE FUNDS >E =?COM+ BECAUSE ! BANK+ SECTOR %>ES ! 9CREAS$ OPTIMISM ( 9VE/ORS4 ,LET US NOT =GET ?AT BANKS >E PRIVATE COMPANIES TOO & SO SEEK PR(ITS AS WELL4 ,AS ,M9SKY >GUES1 0BANK]S LIVE 9 ! SAME EXPECTATIONAL CLIMATE AS BUS9ESSM50 & SO 0PR(IT-SEEK+ BANK]S WILL F9D WAYS ( ACCOMMODAT+ !IR CU/OM]S 444 ,BANKS & BANK]S >E NOT PASSIVE MANAG]S ( MONEY TO L5D OR TO 9VE/2 !Y >E 9 BUS9ESS TO MAXIMIZE PR(ITS40 ,PROVID+ CR$IT IS ! KEY WAY ( DO+ ?IS & SO CR$IT EXPANSION OCCURS4 ,IF !Y DID NOT1 ! BOOM W\LD SOON TURN 9TO SLUMP AS 9VE/ORS W\LD HAVE NO FUNDS AVAILABLE = !M & 9T]E/ RATES W\LD 9CREASE1 ?US =C+ FIRMS TO PAY MORE 9 DEBT REPAYM5T1 AN 9CREASE :I* MANY FIRMS MAY NOT BE ABLE TO DO OR F9D DIFFICULT4 ,?IS 9 TURN W\LD SUPPRESS 9VE/M5T & SO PRODUCTION1 G5]AT+ UNEMPLOYM5T 7AS COMPANIES CANNOT 0FIRE0 9VE/M5TS AS EASILY AS !Y CAN FIRE WORK]S71 SO R$UC+ CONSUMPTION DEM& ALONG ) 9VE/M5T DEM&1 SO DEEP5+ ! SLUMP4 

,TO AVOID ?IS & TO TAKE ADVANTAGE ( ! RIS+ ECONOMY1 BANK]S ACCOMMODATE !IR CU/OM]S & G5]ATE CR$IT RA!R ?AN RISE 9T]E/ RATES4 ,9 ?IS WAY !Y ACCEPT LIABILITY /RUCTURES BO? = !MSELVES & = !IR CU/OM]S 0?AT1 9 A MORE SOB] EXPECTATIONAL CLIMATE1 !Y W\LD HAVE REJECT$40 7,M9SKY7 ,! BANKS 9NOVATE !IR F9ANCIAL PRODUCTS1 9 O!R WORDS1 9 L9E ) DEM&4 ,FIRMS 9CREASE !IR 9DEBT$NESS & BANKS >E MORE ?AN WILL+ TO ALL[ ?IS DUE TO ! FEW SIGNS ( F9ANCIAL /RA9 9 ! ECONOMY4 ,! 9DIVIDUAL FIRMS & BANKS 9CREASE !IR F9ANCIAL LIABILITY1 & SO ! :OLE ECONOMY MOVES UP ! LIABILITY /RUCTURE4 ,LIKE O!R BUS9ESSES1 BANKS OP]ATE 9 AN UNC]TA9 5VIRONM5T & HAVE NO WAY ( KN[+ :E!R !IR ACTIONS WILL 9CREASE ! FRAGILITY )9 ! ECONOMY OR PU% IT 9TO CRISIS4 

,! C5TRAL BANKS1 MEAN:ILE1 ACCOMMODATE ! BANKS ACTIVITY4 ,!Y DO NOT & CANNOT =CE !M TO CREATE CR$IT4 ,ALAN ,HOLMES1 A S5IOR VICE PRESID5T AT ! ,NEW ,YORK ,F$]AL ,RES]VE1 PUT ! PROCESS ?IS WAY3 0,9 ! REAL WORLD1 BANKS EXT5D CR$IT1 CREAT+ DEPOSITS 9 ! PROCESS1 & LOOK = ! RES]VES LAT]4 ,! QUE/ION !N BECOMES ONE ( :E!R & H[ ! ,F$]AL ,RES]VE WILL ACCOMMODATE ! DEM& = RES]VES4 ,9 ! V]Y %ORT RUN1 ! ,F$]AL ,RES]VE HAS LITTLE OR NO *OICE AB\T ACCOMMODAT+ ?AT DEM&1 OV] TIME1 ITS 9FLU5CE CAN OBVI\SLY BE FELT40 

,AS LONG AS PR(ITS EXCE$ DEBT S]VIC+ REQUIREM5TS1 ! SY/EM WILL CONT9UE TO WORK4 ,EV5TUALLY1 ?\<1 9T]E/ RATES RISE AS ! EXI/+ EXT5SION ( CR$IT APPE>S TOO HI< TO ! BANKS OR ! C5TRAL BANK4 ,?IS AFFECTS ALL FIRMS1 FROM ! MO/ CONS]VATIVELY F9ANC$ TO ! MO/ SPECULATIVE1 & 0PU%ES0 !M UP EV5 HI<] UP ! LIABILITY /RUCTURE4 ,REF9ANC+ EXI/+ DEBTS IS MADE AT ! HI<] RATE ( 9T]E/1 9CREAS+ CA% \TFL[S & R$UC+ DEM& = 9VE/M5T AS ! DEBT BURD5 9CREASES4 ,CONS]VATIVELY F9ANC$ FIRMS CAN NO LONG] CAN REPAY !IR DEBTS EASILY1 LESS CONS]VATIVE ONES FAIL TO PAY !M & SO ON4 ,! M>G9 ( ]ROR N>R[S & FIRMS & BANKS BECOME MORE VULN]ABLE TO UNEXPECT$ DEVELOPM5TS1 SU* A NEW COMPETITORS1 /RIKES1 9VE/M5TS :I* DO NOT G5]ATE ! EXPECT$ RATE ( RETURN1 CR$IT BECOM+ H>D TO GET1 9T]E/ RATES 7P>TICUL>LY 9T]-BANK ONES7 9CREASES & SO ON4 ,?IS LEADS FIRMS TO PAY MORE ( !IR PR(ITS 9 9T]E/ REPAYM5TS1 CUT BACK 9 9VE/M5TS1 FIRE EMPLOYES & SO =?4 ,BANKS1 MEAN:ILE1 CANNOT F9D RES\RCES TO MEET !IR CR$ITORS' DEM&S & HOLD ON TO :AT MONEY !Y HAVE1 CAUS+ ! CR$IT M>KETS TO FREEZE UP4 ,IT ALSO R$UCES CONSUM] DEM&1 AS 9DIVIDUALS CAN NO LONG] F9D EASY CR$IT & HAVE TO USE MORE ( !IR WAGES TO S]VICE !IR DEBTS &_/OR CANNOT F9D CR$IT TO BOL/] DEM& 9 ! FACE ( DECL9+ OR /AGNAT+ 9COME FROM WAGES4 ,A G5]AL DECREASE 9 DEM& IS COMB9$ ) OV]-9VE/M5T1 MUTUALLY RE9=C+ EA* O!R4 ,9 ! 5D1 ! BOOM TURNS TO SLUMP & FIRMS & BANKS FAIL4 ,! /ATE !N 9T]V5ES TO TRY & /OP ! SLUMP GETT+ WORSE 7) V>Y+ DEGREES ( SUCCESS & FAILURE74 

,?US ! G5]ATION ( CR$IT IS A SPONTANE\S PROCESS ROOT$ 9 ! NATURE ( CAPITALISM & IS FUNDAM5TALLY 5DOG5\S 9 NATURE4 ,?IS MEANS ?AT ! BUS9ESS CYCLE IS AN 9H]5T P>T ( CAPITALISM EV5 IF WE ASSUME ?AT IT IS CAUS$ PURELY BY DISEQUILIBRIUM 9 ! CR$IT M>KET4 ,9 O!R WORDS1 IT IS MORE ?AN LIKELY ?AT ! CR$IT M>KET WILL BE 9 DISEQUILIBRIUM LIKE EV]Y O!R M>KET 9 ANY REAL CAPITALI/ ECONOMY - & = ! SAME REASONS4 

,?IS EXPLA9S :Y SO MANY BANKS SPECULAT$ 9 SU* AN OBVI\SLY 9SANE M>KET AS ! SUB-PRIME LOANS ONE4 ,AS A BOOM LEADS TO EUPHORIA1 ,M9SKY >GU$1 BANKS & O!R COMM]CIAL L5D]S EXT5D CR$IT TO EV] MORE DUBI\S BORR[]S1 (T5 CREAT+ NEW F9ANCIAL 9/RUM5TS TO DO SO 7& NEW 9/RUM5TS >E CREAT$ TO AVOID :AT REGULATION EXI/S AS WELL74 ,DUR+ ! #a#i#hS1 JUNK BONDS PLAY$ ?AT ROLE4 ,MORE REC5TLY1 IT WAS ! SECURITIZATION ( MORTGAGES1 :I* 5ABL$ BANKS TO PROVIDE HOME LOANS )\T WORRY+ IF !Y W\LD EV] BE REPAID4 ,!N1 AT ! TOP ( ! M>KET 79 ?IS CASE1 MID-#b#f71 SOME SM>T TRAD]S />T TO CA% 9 !IR PR(ITS :ILE ! RE/ W]E LEFT ) ! GRIM REALITY ( L5D+ MONEY TO PEOPLE :O C\LD NEV] AF=D TO PAY IT BACK 9 ! LONG RUN4 ,%ORT-T]MISM CAME HOME TO ROO/1 ONLY TO F9D ?AT IT HAD BE5 REPOSSESS$4 

,:I* MEANS1 ( C\RSE1 ?AT F9ANCE M>KETS >E NOT ! 0EFFICI5T0 & 0RATIONAL0 ALLOCATORS ( 9VE/M5T FUNDS PORTRAY$ 9 ! ECONOMIC TEXTBOOKS & F9ANCE PAGES ( ! NEWSPAP]S4 ,WALL ,/REET & ITS EQUIVAL5TS FREQU5TLY MISALLOCATE CAPITAL & CR$IT4 ,! 0TE* BUBBLE0 ( ! LATE #a#i#iS WAS ONE EPISODE4 ,N[ WE HAVE SUBPRIME MORTGAGES4 

,?IS %\LD BE UNSURPRIS+1 AS ! EXI/5CE ( A /OCK M>KET HAS S]I\S 7NEGATIVE7 EFFECTS ON 9VE/M5T4 ,AS ,H5WOOD NOTES 9 HIS ESS5TIAL ANALYSIS ( F9ANCE CAPITAL1 !RE 0>E S]I\S COMMUNICATION PROBLEMS BETWE5 MANAG]S & %>EHOLD]S40 ,?IS IS BECAUSE 0.<E.>V5 IF P>TICIPANTS >E AW>E ( AN UPW>D BIAS TO E>N+S E/IMATES .<( COMPANIES.>1 & EV5 IF !Y CORRECT = IT1 MANAG]S W\LD /ILL HAVE AN 9C5TIVE TO TRY TO FOOL ! M>KET4 ,IF Y\ TELL ! TRU?1 Y\R ACCURATE E/IMATE WILL BE M>K$ D[N BY A SKEPTICAL M>KET4 ,SO1 IT'S 5TIRELY RATIONAL = MANAG]S TO BOO/ PR(ITS 9 ! %ORT T]M1 EI!R ?R\< ACC\NT+ GIMMICKRY OR BY MAK+ ONLY 9VE/M5TS ) QUICK PAYBACKS40 ,SO1 MANAG]S 0FAC+ A M>KET .<! /OCK M>KET.> ?AT IS FAM\S = ITS PREF]5CE = QUICK PR(ITS TODAY RA!R ?AN PATI5T LONG-T]M GR[? HAVE LITTLE *OICE BUT TO DO ITS BIDD+4 ,O!RWISE1 !IR /OCK WILL BE M>K$ D[N1 & ! FIRM RIPE = TAKEOV]40 ,:ILE 0.<F.>IRMS & ECONOMIES CAN'T GET RI*] BY />V+ !MSELVES0 /OCK M>KET 9VE/ORS 0CAN GET RI*] :5 ! COMPANIES !Y [N GO HUNGRY -- AT LEA/ 9 ! %ORT T]M4 ,AS = ! LONG T]M1 WELL1 ?AT'S SOMEONE ELSE'S PROBLEM ! WEEK AFT] NEXT40 ,9 FACT1 0! SIGNALS EMITT$ BY ! /OCK M>KET >E EI!R IRRELEVANT OR H>MFUL TO REAL ECONOMIC ACTIVITY1 & ?AT ! /OCK M>KET ITSELF C\NTS LITTLE OR NO?+ AS A S\RCE ( F9ANCE4 ,%>EHOLD]S 444 HAVE NO USEFUL ROLE40 7,WALL ,/REET1 P4 #a#g#a1 P4 #b#i#b7 

,IRONICALLY1 ?IS SITUATION HAS A P>ALLEL ) ,/AL9I/ C5TRAL PLANN+1 :]E ! MANAG] ( ,/ATE WORKPLACES HAD AN 9C5TIVE TO LIE AB\T !IR CAPACITY TO ! PLANN+ BUREAUCRACY4 ,! PLANN] W\LD1 9 TURN1 ASSUME HI<] CAPACITY1 SO H>M+ HONE/ MANAG]S & 5C\RAG+ !M TO LIE4 ,?IS1 ( C\RSE1 HAD A S]I\SLY BAD IMPACT ON ! ECONOMY4 ,UNSURPRIS+LY1 ! SIMIL> EFFECTS CAUS$ BY CAPITAL M>KETS ON ECONOMIES SUBJECT TO !M AS JU/ AS BAD1 D[NPLAY+ LONG T]M ISSUES & 9VE/M5T4 ,BUT1 AS ! RI* GET RI*] & CAN EX]CISE CONTROL OV] ! /ATE BY !SE M>KETS !Y WILL CONT9UE AS LONG AS CAPITALISM DOES &1 ( C\RSE1 BE RATIONALIZ$ BY ! ECONOMICS PR(ESSION AS BE+ 0EFFICI5T0 & 0RATIONAL40 

,! [N]%IP SOCIETY 

,MAX ,/IRN] ONCE NOT$ ?AT PROP]TY 09 ! CIVIC S5SE MEANS SACR$ PROP]TY1 SU* ?AT ,I MU/ RESPECT Y\R PROP]TY 444 ,BE IT EV] SO LITTLE1 IF ONE ONLY HAS SOME:AT ( HIS [N - TO WIT1 A RESPECT$ PROP]TY3 ,! MORE SU* [N]S 444 ! MORE 'FREE PEOPLE & GOOD PATRIOTS' HAS ! ,/ATE40 ,H[EV]1 09 PRACTICE PEOPLE RESPECT NO?+1 & EV]YDAY ! SMALL POSSESSIONS >E B\<T UP AGA9 BY GREAT] PROPRIETORS1 & ! 'FREE PEOPLE' *ANGE 9TO DAY LABOR]S40 ,?US ! 0CIVIC PROPRIETOR IS 9 TRU? NO?+ BUT A PROP]TYLESS MAN1 ONE :O IS EV]Y:]E %UT \T4 ,9/EAD ( [N+ ! WORLD1 AS HE MI<T1 HE DOES NOT [N EV5 ! PALTRY PO9T ON :I* HE TURNS >\ND40 

,?IS HAS BE5 ! BASIS ( NEO-LIB]ALISM1 ) ,P9O*ET & ,?AT*] SEEK+ TO CREATE MANY SU* 0FREE & GOOD PATRIOTS0 :ILE1 9 REALITY1 9CREAS+ 9EQUALITY & SQUEEZ+ ! SO-CALL$ MIDDLE CLASSES4 ,BU%1 LIKEWISE1 WANT$ TO TURN MORE PEOPLE 9TO A 0CIVIC PROPRIETOR0 BY PRIVATIZ+ ,SOCIAL ,SECURITY & DELIV]+ !IR ACC\NTS TO ,WALL ,/REET4 ,MOREOV]1 HE URG$ ?AT HIS 0[N]%IP SOCIETY0 REQUIR$ EASY ACCESS TO ! CR$IT NE$$ = HOME[N]%IP4 0,UND] #e P]C5T ( ,AFRICAN ,AM]ICANS & ,HISPANIC ,AM]ICANS [N A HOME10 ,BU% /AT$ 9 #b#b1 0?AT'S JU/ TOO FEW0 & HE CALL$ ON ,FANNIE ,MAE & ! PRIVATE SECTOR 0TO UNLOCK MILLIONS ( DOLL>S1 TO MAKE IT AVAILABLE = ! PUR*ASE ( A HOME40 ,:I*1 ( C\RSE1 !Y DID - IT WAS CALL$ A SUB-PRIME LOAN4 

,!N !RE IS ! SOCIAL ROLE ( CR$IT & DEBT4 ,AS NOT$1 S9CE ! #a#i#hS ! ,U,K & ,U,S,A HAVE SE5 A RIS+ DEBT BURD5 ON H\SEHOLDS AS WELL AS ! 9CREAS$ CONC5TRATION ( WEAL?4 ,! TWO >E L9K$4 ,DUE TO 0! DECL9E 9 REAL H\RLY WAGES1 & ! /AGNATION 9 H\SEHOLD 9COMES1 ! MIDDLE & L[] CLASSES HAVE BORR[$ MORE TO /AY 9 PLACE0 & !Y HAVE 0BORR[$ FROM ! V]Y RI* :O HAVE .<BECOME.> RI*]40 ,BY #a#i#i#g1 ,U,S H\SEHOLDS SP5T @s#a TRILLION 7OR #a#g.0 ( ! AFT]-TAX 9COMES7 ON DEBT S]VICE4 0,?IS REPRES5TS A MASSIVE UPW>D R$I/RIBUTION ( 9COME40 ,& :Y DID !Y BORR[8 ,! BOTTOM #d.0 ( ! 9COME DI/RIBUTION 0BORR[$ TO COMP5SATE = /AGNANT OR FALL+ 9COMES0 :ILE ! UPP] #b.0 BORR[$ 0MA9LY TO 9VE/40 ,?US 0CONSUM] CR$IT CAN BE ?\<T ( AS A WAY TO SU/A9 MASS CONSUMPTION 9 ! FACE ( /AGNANT OR FALL+ WAGES4 ,BUT !RE'S AN ADDITIONAL SOCIAL & POLITICAL BONUS1 FROM ! PO9T ( VIEW ( ! CR$ITOR CLASS3 IT R$UCES PRESSURE = HI<] WAGES BY ALL[+ PEOPLE TO BUY GOODS !Y C\LDN'T O!RWISE AF=D4 ,IT HELPS TO N\RI% BO? ! APPE>ANCE & REALITY ( A MIDDLE-CLASS /&>D ( LIV+ 9 A TIME ( POL>IZATION4 ,& DEBT CAN BE A GREAT CONS]VATIZ+ =CE2 ) A L>GE MON?LY MORTGAGE &_/OR ,MA/],C>D BILL1 /RIKES & O!R =MS ( TR\BLEMAK+ LOOK LESS APPEAL+ ?AN !Y W\LD O!R WISE40 ,DEBT IS 0AN IMPORTANT =M ( SOCIAL CO]CION2 MORTGAG$ WORK]S >E MORE PLIABLE40 7,H5WOOD1 PP4 #f#d-#f1 P4 #b#c#b7 

,TODAY1 ! LEGACY ( CONFUS+ ! BASIC NE$ TO HAVE ACCESS TO ! RES\RCES REQUIR$ = P]SONAL FRE$OM ) PRIVATE PROP]TY IS BECOM+ CLE>4 ,! SO-CALL$ [N]%IP SOCIETY SIMPLY MEANS ! DEBT-SOCIETY1 :]E Y\ >E [N$ BY Y\R CR$ITORS JU/ AS MU* AS Y\R LABOR & ITS PRODUCTS >E [N$ BY Y\R BOSS4 ,! #a#i#iS DOT-COM BUBBLE BUR/ & EMPLOYES WAT*$ !IR /OCK-HEAVY P5SIONS DISAPPE>4 ,N[ ! #bS HAVE ! SUBPRIME MORTGAGE CRISIS1 ) MILLIONS ( HOME[N]S FAC+ REPOSSESSION4 

,! ,FUTURE444 

,IT IS SURELY SIGNIFICANT ?AT A S+LE ,FR5* ROGUE TRAD] HAS PROVID$ 0! M>KETS0 & M$IA ) A USEFUL EXCUSE = ! ECONOMIC WOES FAC+ CAPITALISM4 ,( C\RSE1 ASSUM+ ?AT IT WAS TRUE1 ?IS 9 ITSELF IS DEEPLY SIGNIFICANT AS IT %[S ! FRAGILITY ( 0! M>KETS0 ?AT ONE P]SON CAN HAVE1 ALLEG$LY1 SU* AN IMPACT4 ,SO1 EV5 IF TRUE 7& ?AT IS D\BTFUL7 IT SIMPLY EXPOS$ AN UND]LY+ WEAKNESS :I* WILL BECOME MORE APP>5T AS TIME GOES ON4 

,RECESSION IS LIKELY1 :I* BR+S US TO ! QUE/ION ( H[ DEEP IT WILL BE4 ,!RE IS EVID5CE TO SUGGE/ ?AT IT WILL BE DEEP4 ,! #a#i#i-#i#a RECESSION 9 ,AM]ICA WAS BR\<T ON BY A CR$IT CRUN* :ILE ! #ba RECESSION WAS R\T$ 9 OV]9VE/M5T 7NAMELY1 ! DOT4COM BUBBLE & ! SPURI\S 09VE/M5T0 ?AT PRODUC$74 ,?IS TIME1 IT LOOKS LIKE BO? HAVE OCCURR$4 ,MOREOV]1 AFT] PRESSURE TO 0LIB]ALIZE0 ITS M>KET 9 ! #a#i#hS1 ,JAPAN EXP]I5C$ A H\S+ BUBBLE AS WELL4 ,IT !N SP5T ! #a#i#iS 9 AN ECONOMIC QUAGMIRE :I* IT IS JU/ GETT+ \T (4 ,:ILE PEOPLE TALK AB\T 0A CRA%0 IT IS USEFUL TO REMEMB] ?AT EV5 #aibi TOOK TIME TO PLAY ITSELF \T4 ,! DEPRESSION DID NOT HAPP5 OV]NI<T & EV5 ,WALL ,/REET RALLI$ SOME:AT 9 ! DAYS AFT] ,BLACK ,MONDAY4 ,SO :ILE SOME ASS]T ?AT REC5T RECESSIONS W]E BRIEF & %ALL[1 ?IS IGNORES ! FACT ?AT ! LA/ TWO W]E FOLL[$ BY PROLONG$ 0JOBLESS RECOV]IES0 - 9 O!R WORDS1 LONG] RECESSIONS = WORK+ CLASS PEOPLE4 ,?IS IS ! CASE ) ! ECONOMY UND] ,BU% - JOB CREATION HAS BE5 PA!TIC & F> ECLIPS$ BY ,CL9TON'S4 

,SIGNIFICANTLY1 ,M>T9 ,WOLF1 A COLUMNI/ AT ! ,F9ANCIAL ,TIMES1 ATTACK$ ! WORLD'S F9ANCE 9DU/RY AS HAV+ AN EXTRAORD9>Y 0TAL5T = PRIVATIZ+ GA9S & SOCIALIZ+ LOSSES0 & !N GET 0SELF-RI<TE\SLY ANGRY :5 PUBLIC (FICIALS 444 FAIL TO COME AT ONCE TO !IR RESCUE :5 !Y GET 9TO 7WELL-DES]V$7 TR\BLE 444 ! CONFLICTS ( 9T]E/ CREAT$ BY L>GE F9ANCIAL 9/ITUTIONS >E F> H>D] TO MANAGE ?AN 9 ANY O!R 9DU/RY40 ,IT SAYS A LOT ?AT EV5 PEOPLE :O WRITE 9 ! ,F9ANCIAL ,TIMES >E UPSET AB\T ! PR$OM9AT+ 9FLU5CE ?AT F9ANCIAL CAPITALI/S HAVE ON GOV]NM5T POLICY4 

,& ! HYPOCRISY IS CLE>4 ,S9CE ! #a#i#hS ! DOM9ANT IDEOLOGY HAS BE5 PREA*+ AGA9/ ! EVILS ( /ATE 9T]V5TION & URG+ GOV]NM5TS TO LET ! M>KETS DO !IR MAGIC4 ,YET :5 !Y FACE PROBLEMS1 ! FREE M>KETE]S GO RUNN+ TO ! /ATE & BEG = HELP4 ,FAC$ ) RESULTS ( !IR [N ACTIONS & IDEOLOGY1 !Y RETURN TO ! /ATE !Y SO REVILE & GET IT TO ANSW] !IR CALLS = HELP4 ,SO ! MANTRA ( CAPITALISM IS SIMPLE3 IF ! F9ANCE M>KETS MAKE MONEY !N !Y CAN KEEP IT BUT IF !Y >E LOOS+ MONEY !N WE NE$ TO PAY = IT4 ,BUT :Y BE SURPRIS$4 ,! /OCK M>KET IS F\ND$ ON CORPORATE 0,LIMIT$ ,LIABILITY0 :I* IS AN EFFECTIVE MEANS ( PRIVATIZ+ GA9S & :ILE SOCIALIZ+ LOSSES4 ,ANYONE ) AN AW>5ESS ( ! HI/ORY ( CAPITALISM WILL KN[ ?AT IT HAS ALWAYS BE5 P>ASITICAL ON ! /ATE4 ,/ATE ACTION CREAT$ IT & CONT9UES TO KEEP IT GO+1 :E!R 9 ! =M ( GOV]NM5T FUND+ ,R@&,D TO CREATE ! 9T]NET1 O!R =MS ( 0CORPORATE WELF>E0 7I4E41 /ATE SUBSIDY 7 OR LA/ M9UTE BAIL\TS4 ,SO :ILE ! CAPITALI/S WANT US TO SUPPORT !M1 !Y D5Y US ANY SAY - BUT1 !N1 CAPITALISM HAS ALWAYS BE5 BAS$ ON BRIB+ & MOLLYCODDL+ ! WEAL?Y4 

,IT SEEMS UNLIKELY ?AT CA% 9JECTIONS WILL C\NT]M& ! UND]LY+ PROBLEMS CAUS$ BY ! H\S+ & O!R BUBBLES - PREVI\S CUTS 9 9T]E/ RATES SIMPLY PO/PON$ ! 9EVITABLE4 ,:AT COMES NEXT IS ! KEY4 ,CAPITALISM WILL1 ( C\RSE1 SURVIVE ?IS LATE/ D[NTURN AS IT HAS ! RE/ - UNLESS WORK+ CLASS PEOPLE F9ALLY ACT TO 5D IT4 ,! GOOD NEWS IS ?AT ACCORD+ TO A ,SEPTEMB] ,PEW ,RESE>* POLL1 #d#h.0 ( ,AM]ICANS SAY !Y LIVE 9 A SOCIETY C>V$ 9TO HAVES & HAVE-NOTS4 ,9 #a#i#h#h1 IT WAS ONLY #b#f.04 ,SADLY1 #d#e.0 SEE !MSELVES AS P>T ( ! HAVES BUT EV5 ?IS FIGURE IS AN IMPROVEM5T 79 #a#i#h#h1 #e#i.0 ?\<T !Y W]E P>T ( ! 0HAVES0 :ILE #a#g.0 PLAC$ !MSELVES 9 ! HALF-NOTS1 N[ IT IS #d#e.0 0HAVES0 VS4 #c#d.0 0HAVE-NOTS074 ,IT IS NICE TO KN[ ?AT SOME PEOPLE >E AW>E ?AT 0,TRICKLE ,UP ECONOMICS0 HAS WORK$6 ,N[ !Y HAVE TO TURN ?AT 9TO ACTION4 ,IF !Y DO NOT1 CAPITALISM WILL CONT9UE AS !Y PAY ! PRICE REQUIR$ TO OV]COME ! SLUMP4 

,F9ALLY1 IT MU/ BE /RESS$ ?AT ?IS ANALYSIS DOES NOT IMPLY ?AT AN>*I/S ?9K ?AT CAPITALISM WILL SELF-DE/RUCT4 ,9 SPITE ( CRISES BE+ 9EVITABLE & OCCURR+ FREQU5TLY1 REVOLUTION IS NOT4 ,CAPITALISM WILL ONLY BE ELIM9AT$ BY WORK+ CLASS REVOLUTION1 :5 PEOPLE SEE ! NE$ = SOCIAL TRANS=MATION & NOT IMPOS$ ON PEOPLE AS ! BYPRODUCT ( AN ECONOMIC COLLAPSE4 ,BAD TIMES MAY RADICALIZE PEOPLE 9TO ACTION1 BUT IT REAL *ANGE NE$S IDEAS & WILL COME AB\T :5 PEOPLE >E 9SPIR$ BY HOPE = A BETT] SOCIETY1 :5 !Y REALIZE ?AT1 TO QUOTE ,/IRN]1 ?AT 0RE/LESS ACQUISITION DOES NOT LET US TAKE BREA?1 TAKE A CALM 5JOYM5T4 ,WE DO NOT GET ! COM=T ( \R POSSESSIONS4440 ,\R TASK AS AN>*I/S IS TO HELP SPREAD ?IS AW>5ESS ?AT WE NE$ NOT LIVE LIKE ?IS & GET 9VOLV$ 9 SPREAD+ ! SPIRIT ( REVOLT NE$$ TO BR+ ?AT HOPE 9TO REALITY4 

,AN $IT$ V]SION WILL APPE> 9 ! NEXT ISSUE ( ,BLACK ,FLAG &1 HOPEFULLY1 ! FULL V]SION 9 ! NEXT ,AN>*O-,SYNDICALI/ ,REVIEW 

,FROM 3 ,!,AN>*I/,LIBR>Y4ORG4 

,*RONOLOGY 3 
,FEBRU>Y #b1 #bba 3 ,CR$IT ,CRUN*3 ,! RETURN ( DEPRESSION8 -- ,ADD$4 
,JANU>Y #g1 #bbb 3 ,CR$IT ,CRUN*3 ,! RETURN ( DEPRESSION8 -- ,UPDAT$4 

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