The financialization of capitalism

Monthly Review

Volumn 58, Issue 11, 2007, Pages 1-12

  Foster, John Bellamy ^a  

^a NONE

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EID: 34247260966     PISSN: 00270520     EISSN: None     Source Type: Journal    
DOI: 10.14452/MR-058-11-2007-04_1     Document Type: Review

References (28)

1. Gerald A. Epstein, "Introduction," In Epstein, ed., Financialization and the World Economy (Northampton, MA: Edward Elgar, 2005), 1.
2. John Bellamy Foster, "Monopoly-Finance Capital," Monthly Review58, no. 7 (December 2007), 1-14.
3. The current usage of the term "financialization" owes much to the work of Kevin Phillips, who employed it in his Boiling Point (New York Random House, 1993) and a year later devoted a key chapter of his Arrogant Capital to the "Financialization of America," defining financialization as "a prolonged split between the divergent real and financial economies" (New York: Little, Brown, and Co., 1994), 82. In the same year Giovanni Arrighi used the concept in an analysis of international hegemonic transition in The Long Twentieth Century (New York Verso, 1994).
4. Harry Magdoff first raised the issue of a growing reliance on debt in the U.S. economy in an article originally published in the Socialist Register in 1965. See Harry Magdoff and Paul M. Sweezy, The Dynamics of U.S. Capitalism (New York Monthly Review Press, 1972), 13-16.
5. Robert Pollin, "Remembering Paul Sweezy: 'He was an Amazingly Great Man'"; Counterpunch, http://www.counterpunch.org, March 6-7, 2004;
6. "The Man Who Explained Empire: Remembering Harry Magdoff," Counterpunch, http://www.counterpunch.org, January 6, 2006.
7. Paul M. Sweezy, "More (or Less) on Globalization," Monthly Review 49, no. 4 (September 1997), 3-4.
8. Paul A. Baran and Paul M. Sweezy, Monopoly Capital (New York Monthly Review Press, 1966).
9. James Tobin, "On the Efficiency of the Financial System," Lloyd's Bank Review, no. 153 (1984), 14-15.
10. In the following analysis I follow a long-standing economic convention in using the term "real economy" to refer to the realm of production (i.e. economic output as measured by GDP), as opposed to the financial economy. Yet both the "real economy" and the financial economy are obviously real in the usual sense of the word.
11. Harry Magdoff and Paul M. Sweezy, Stagnation and the Financial Explosion (New York Monthly Review Press, 1987), 149. Magdoff and Sweezy were replying to an editorial in Business Week concluding its special September 16, 1985, issue on "The Casino Society."
12. Paul M. Sweezy, "Economic Reminiscences," Monthly Review 47, no. 1 (May 1995), 8;
13. Lukas Menkhoff and Norbert Tolksdorf, Financial Market Drift (New York: Springer-Verlag, 2001).
14. The failure of investment banking to regain its position of power at the very apex of the system (as the so-called "money trust") that it had attained in the formative period of monopoly capitalism can be attributed to the fact that the conditions on which its power had rested in that period were transitory. See Paul M. Sweezy, "Investment Banking Revisited," Monthly Review 33, no. 10 (March 1982).
15. Harry Magdoff and Paul M. Sweezy, The End of Prosperity (New York Monthly Review Press, 1977), 35.
16. Sweezy, "Economic Reminscences," 8-9.
17. This is in line with the financial instability hypothesis of Keynes and Hyman Minsky. See Minsky, Can "It" Happen Again? (Armonk, New York: M. E. Sharpe, 1982).
18. Robert W. Parenteau, "The Late 1990s' US Bubble," in Epstein, ed., Financialization and the World Economy, 136-38.
19. Doug Henwood, After the New Economy (New York: The New Press, 2005), 231;
20. Fred Magdoff, "Explosion of Debt and Speculation," Monthly Review 58, no. 6 (November 2006), 7, 19; Epstein, "Introduction," 4;
21. Garry J. Schinasi, Safeguarding Financial Stability (Washington, D.C.: International Monetary Fund, 2006), 228-32.
22. Greta R. Krippner, "The Financialization of the American Economy," Socio-economic Review 3, no. 2 (2005), 173-208;
23. James Crotty, "The Neoliberal Paradox," in Epstein, ed., Financialization and the World Economy, 77-110.
24. Edward N. Wolff, "Changes in Household Wealth in the 1980s and 1990s in the U.S." The Levy Economics Institute of Bard College, Working Paper No. 407 (May 2004), table 2, http://www.levy.org.
25. Pollin, "The Man Who Explained Empire."
26. See Daniela Magalhàes Pates and Leda Maria Paulani, "The Financial Globarlization of Brazil Under Lula" and Fabríco Auguste de Loiveira and Paulo Nakatini, "The Brazilian Economy Under Lula," in Monthly Review 58, no. 9 (February 2007), 32-49.
27. International Monetary Fund, The Global Financial Stability Report (March 2003), 1-3 and (September 2006), 74-75.
28. Gabriel Kolko, "Why a Global Economic Deluge Looms," Counterpunch, http://www.counterpunch.org, June 15, 2006.