And it's more than just the wolf... Oil prices have crossed the critical price threshold of $40 per barrel, and the huffing and puffing you hear is the house starting to come down.
First and always, the shock is manifested in the interest rate sensitive sectors. The money made from the instruments of trading in money, the derivatives of the derived, has is not so much the canary in the coal mine, as it mayfly. Every breath drawn, and cut short, by the change in basis points. JP Morgan's emerging market index dropped 5.5 percent in just 3 days. Trading in emerging market debt instruments, both corporate and government has evaporated. Russia, 2004 as in 1998, appears as the dream gone to nightmare. This time it's Russian corporate bond market losing liquidity, with the debt instruments themselves drying up and turning to dust.
So it was just yesterday that all the bankers' men and all the bankers' women were praising the remarkable turnaround from the dark days of the GKO default, and it's just tomorrow when the oil spiked turnaround turns around into its opposite.
But if Russia give dread a form, China gives it content. An economy so uneven, so combined, with agriculture in ruins, unemployment at 200 million; an economy of import and re-export, of overconstruction, overproduction, and underdevelopment all at once, it is China that will give new meaning to the word bubble, and the term collapse.
So let's get to the part where we get to look back and say "I told you so." The upsurge in US profits, predicated upon the increase expulsion of labor from the manufacturing process, is exactly that overproduction that precipitates the decline in the rate of profit. Overproduction works its way throughout the world market in many guises-- price rises, apparent scarcity, demand acceleration, interest rate rises... The different facets of this process converge on the need to destroy the instruments of production and the living standards of the producers.
2004 will remembered as the year of this convergence, and the year when US elections are cancelled, suspended, suppressed.
S. Artesian
May 15, 2004
Or the manic, bourgeois Democratic political machine could run a rich-assed pro-war Yale graduate whose politics--especially on foreign and trade policy--is well right of the people being asked to vote for him , as he is anyone but Bush. Is a wolf in sheep's clothing anything but a wolf? Well pity poor Sen. Kerry. If he takes over the Bush babies and does a great job for the national security state, Bush won't go down in history as the worst president ever. If he does a lousy job salvaging the national security state, he'll find out that trying to be all things to all people (except the people who care) means being nothing to no one at the time it should have counted the most. Does Kerry have any potential to be a leader on any issue that is important? So far, there doesn't seem to be any chance at all.
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