[CrashList] 2nd reply to Julien
M A Jones
jones118 at lineone.net
Wed Sep 27 00:21:12 MDT 2000
> >Dollar hegemony has resulted in savage deflationary
> pressures in the
> >world economy outside the US.
> That is if you think that the world has not been truely
> globalized. I would agree
> with that but I thought that you thought it had actually
> been globalized.
What does 'truly globalised'mean in this context?
> confuse you with someone else.
> If the world was globalized, a strong dollar would been
> inflation not deflation in
> the non-dollar countries as 1) stronger US demand for goods
> would bring non-
> US exports' non-dollar prices up and as 2) US exports'
> non-dollar prices
> would go up too as a direct result of the strong dollar.
Surely there 2 (at least) strong deflationary consequences of the
strong dollar: 1 is that is induces a tidal wave of dollars hoarded
elsewhere to flow back to the US to buy bonds and even assets,
reducing available pool of capital elsehwere and 2, you're righ, a
strong dollar puts inflationary pressure on weaker countries which
they precisely countreact by strong *deflationary* internal social
anf=d fiscal policies, to keep their own currency strong.
> I do
> think that the US has been the engine of the world economy lately.
That's surely been a deflationary factor elsewhere, since most of the
dollar profits have not been retained or have been using to invest in
maquilador type operations which actually may not benefit local
ecopnomies are counteract internal deflationary forces.
> >The huge increase in
> >income and wealth inequality this has produced *is the immediate
> >result of fundamental constraints on the capitalist growth
> model', in
> >particular, energy-shortage. ...
> Mark, you have a good case for physical limits beign the
> main economic
> factor NOW. My opinion is that you spoil your credibility
> by saying that it was
> so in the past (with the exception of a few years at the
> end of the seventies,
> maybe). Was 10 or 20 dollars a baril expensive? I mean, a
> baril is something
> big. Compare it to the price of milk, f.ex.! But anyway I
> have argued enough
> with you, bringing forward data, about this.
This is hard to grasp only if you do not grasp the estent to which
there has been no true market-set price for oil for a very long time
(maybe not since the 1890s).
> I will not discuss economic growth or $ p.a. since this is
> useless stats. If you
> want to find a plausible physical cause for the real
> problems, you'd have a
> better case in the limits of availability of good land and
> water p.a. IMO.
They might also be factors, let us dig up some stats.
> Anyway, all these problems are the results of policies as
> much as if not more
> than energy availability. F.ex., how do you explain Algeria
> with your theories?
What about Algeria? It's been a 'high absorber' affliicted by low oil
and gas prices for its principal exports for a while now.
> Another point as to the importance of policies: Seen the
> spread between
> Malaysian vs. US/EU bond rates? Not much financial weakness
> there, it
Don't get this. What about Thailand, Hiong Kong and Japan again?
> First, stop to use that index. Why not use the S&P or the
Yes, I agree that the parallels with the 1930s are misleading.
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