djones at uclink.berkeley.edu
Tue Aug 15 20:49:08 MDT 1995
from Robert Steiner, "Like Midas of Old, Japan Awash in Cash: Weak Economy
Convinves Businesses, Consumers Restrict Spending', WSJ 5/31/95
"For Japan's economy to grow, consumers need to spend and businesses need
to invest in new business. But Japanese are afraid of doing either.
Manufactureers already have too many factories in Japan. Consumers remain
frightened by the sluggish economy. And many investors, still feeling
burned by Japan's dismal stock market and too anxious about weak foreign
currencies to risk capital overseas, feel more comfortable sticking their
money in domestic bank accounts. Japan's excess cash is a headache for the
bank of Japan. Some critics say the central bank hasn't cut interet rates
deeply enough to encourage the spending and investment needed to spark
recovery. In April, the central bank cut the dis count rate, the rate it
charges for laons, by 0.75 percentage point, to 1%, a record low. But that
price isn't as low as it may seem: Since prices are actually in Japan, the
inflation-adjusted interest rate is considerably higher than 1%. The
problem is that hte Bank of Japan finds itself faced with the classic
frustration of 'pushing on one string.' Japan's excess 'cash is not
utilized in the economic system to create economic growth, says Minkeo
Sasaki-Smith, an economist at Morgan Stanley &Co."
1. crisis is presented here as an overproduction of use values ("too many
factories"), not as an overproduction of exchange values which cannot
presently be used for further accumulation at the given rate of
exploitation. Of course mankind is in desperate need of more specific use
This is all that Marx means by his argument that the last cause of all
crises is the underconsumption of the masses: if production were for human
need, instead of the production of surplus value, then there would be no
economic crisis. In short, this passage helps bring out the contradiction
between use-value and exchange value.
2. consumers' "fright" is itself the result of declining investment, the
low demand for labor power since the use value of that special commodity is
not sufficently generative of surplus value. Low consumer demand itself is
explained by an insufficient production of surplus value, production
retaining its explanatory primacy.
3. the above quote indicates the limits of the anti-rentier strategy in
that cash will not be "utilized in the economic system to create economic
growth" unless capital can still sweat enough surplus value from labor in
production. The class struggle within production is primary.
4. the weakness of the Japanese stock market indicates the vulnerability
of speculative capital, the liklihood of bubbles bursting when industrial
capital is not sufficiently profitable to sustain speculative-induced
5. the problem of cash hoards is highlighted by Grossmann, indicating once
again how living his Marxism remains.
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