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The Greek turmoil commenced as a balance of payments, or "sudden stop," crisis induced by large current account and primary government deficits. It became an economic and social disturbance of historic proportions. Its proximate cause was loss of competitiveness within the Eurozone due in large part to domestic German wage policies. The bailout policies, imposed by the lenders primarily for reasons of Eurozone stability and adopted by Greece, have had disastrous effects on both economy and society. The "historical bloc" that dominates Greek society willingly submitted to the bailout strategy, losing sovereignty, for reasons including fear and identity. [ABSTRACT FROM AUTHOR]

Abstract: Changing a country's currency involves a redenomination risk arising due to assets and liabilities that are impossible to redenominate because of contracts governed by foreign law. Depreciation or appreciation of the new currency could, therefore, result in losses or gains, thus creating a risk for economic agents. The risk can be estimated by splitting the economy into public, private, banking and central banking sectors, and summing up exposed aggregate assets and liabilities. This method is applied to Greece showing that exiting the EMU would certainly entail forbidding redenomination losses for the Greek public sector, leading to default. Surprisingly, however, the impact on the private and the banking sectors would actually be positive (gain). The impact on the Bank of Greece would be ambiguous depending primarily on the legal status of TARGET2 liabilities. It is notable that even the Bank of Greece possesses a significant cushion in the form of bonds under foreign law. In all, the redenomination risk for the Greek economy is modest, with the exception of the public sector. [ABSTRACT FROM AUTHOR]

During the eurozone crisis much of the Left argued in favor of remaining in the European Monetary Union (EMU) and the European Union, often in the name of internationalism, while developing a broad alliance against austerity and neoliberalism. However, the EMU has functioned in practice as a mechanism of ascendancy for German manufacturing capital, based on suppressing German workers. As the eurozone crisis is pacified, an entrenched division in Europe has emerged between an unstable core dominated by Germany, a Southern periphery withno growth prospects, and a Central European periphery dependent on German industry. Faced with this harsh reality, a class-based strategy for the Left must include rejecting the EMU, clashing with the eu, and demanding popular sovereignty. That would provide a true basis for internationalism in Europe. [ABSTRACT FROM AUTHOR]

The current crisis is one outcome of the financialisation of contemporary capitalism. It arose in the USA because of the enormous expansion of mortgage-lending, including to the poorest layers of the working class. It became general because of the trading of debt by financial institutions. Th ese phenomena are integral to financialisation. During the last three decades, large enterprises have turned to open markets to obtain finance, forcing banks to seek alternative sources of profit. One avenue has been provision of financial services to individual workers. Th is trend has been facilitated by the retreat of public provision from housing, pensions, education, and so on. A further avenue has been to adopt investment-banking practices in open financial markets. Th e extraction of financial profi ts directly out of personal income constitutes financial expropriation. Combined with investment-banking, it has catalysed the current gigantic crisis. More broadly, financialisation has sustained the emergence of new layers of rentiers, defined primarily through their relation to the financial system rather than ownership of loanable capital. Finally, financialisation has posed important questions regarding finance-capital and imperialism. [ABSTRACT FROM AUTHOR]

Costas Lapavitsas (see, Costas Lapavitsas et al., ‘Euro-zone crisis: beggar thyself and thy neighbour’,Journal of Balkan and Near Eastern Studies, v.12, n.4, December 2010), a Professor of Economics at SOAS, University of London, and now elected member of the Greek parliament with left-wing party, Syriza, talks to Sebastian Budgen about Marxism and Keynesianism; the Euro-zone crisis; Greece’s predicaments; and ways out of the economic and political crisis that hit Greece and the continent. We are thankful to Sebastian Budgen and theJacobinmagazine for allowing reproduction of the interview inJBNES. [ABSTRACT FROM PUBLISHER]

Costas Lapavitsas charts the growth of the 'unstable, unequal and slow-growing' system of financialised capitalism that has taken root in mature economies over the past 40 years, and outlines initial steps to disentangling businesses, services, workers and households from its grasp. [ABSTRACT FROM AUTHOR]

The article presents information on the Royal Society of Arts event on "How to Change the Post-Crash Economy." The panelists at the event included Ben Chew, Economics Editor of The Independent; economics professor Costas Lapavitsas; and Paul Mason, Culture and Digital Editor of Channel 4 News. They discussed financialisation of contemporary mature capitalism, and increasing involvement of households in the activities of the financial system.

Financialization is a systemic transformation of capitalism that has occurred during the last four decades. This paper shows that the concept of financialization originates in Marxist theory, though its meaning remains unclear. It then proposes a theory of financialization as rooted in the altered behaviour of the fundamental agents of capitalist accumulation, including non-financial corporations, banks and workers. Finance has reshaped the activities of all three, also resulting in new forms of profit. It follows that opposing financialization is a complex process that involves creating public financial institutions but also re-establishing public provision for workers across a broad range of activities. Financialization cannot be reversed without re-establishing the command of the social and collective over the private and individual for the modern era. [ABSTRACT FROM AUTHOR]

The article examines how the integration of developing counties into the eurozone geopolitical and economic zone has been impacted following the global economic recession of 2008-2009. The author discusses the relationship between European Union (EU) member states such as Germany and peripheral eurozone countries such as Greece, noting the effect European monetary unions and the creation of the European Central Bank have had on financial integration and interdependence in the region. The role of national competitiveness within the EU and the impact of the U.S. mortgage bubble crisis on the German economy are also addressed.

The article presents the speeches of college faculty members Costas Lapavitsas, Kevin Featherstone, Peter Bratsis, Stathis Kouvelakis, and Etienne Balibar given during a debate at the Birkbeck Institute for the Humanities at the University of London in England on May 5, 2010 in which the contributing factors to Greece's economic crises such as corruption and clientelism are mentioned as well as the solidarity of national economies in the Eurozone.

Costas Lapavitsas considers the political economy of bloated finance and makes a case for establishing democratically-run public banks, which, he asserts, could strengthen the social and the collective in modern economies [ABSTRACT FROM AUTHOR]

The current crisis is one outcome of the financialisation of contemporary capitalism. It arose in the USA because of the enormous expansion of mortgage-lending, including to the poorest layers of the working class. It became general because of the trading of debt by financial institutions. These phenomena are integral to financialisation. During the last three decades, large enterprises have turned to open markets to obtain finance, forcing banks to seek alternative sources of profit. One avenue has been provision of financial services to individual workers. This trend has been facilitated by the retreat of public provision from housing, pensions, education, and so on. A further avenue has been to adopt investment-banking practices in open financial markets. The extraction of financial profits directly out of personal income constitutes financial expropriation. Combined with investment-banking, it has catalysed the current gigantic crisis. More broadly, financialisation has sustained the emergence of new layers of rentiers, defined primarily through their relation to the financial system rather than ownership of loanable capital. Finally, financialisation has posed important questions regarding finance-capital and imperialism. [ABSTRACT FROM AUTHOR]

Examines the relations of power and trust as components of contemporary money and finance. Significant aspects of contemporary money and finance namely personal finance, independent central banking and world money; Economic and social power of money; Role of trust in credit transactions.

Money's emergence in commodity exchange remains an unresolved issue within economic theory. Current general equilibrium models offer an explanation that rests on the economic advantages of a universally accepted means of exchange that is partly established through social custom. These models neither fully explain money's unique ability to buy, nor theorise the customary practices required for money's emergence. They are dominated by Menger's earlier analysis of money's emergence, which pays more attention to the social foundations of money but is still hampered by Austrian individualism. An alternative explanation is given here, drawing on Marx's theory of value but involving a thorough reworking of it. An analytical process is established through which money finally emerges as monopolist of the ability to buy. Particular social custom, whose determinants are consistent with the social underpinnings of commodity exchange, plays a vital role in money's emergence. [ABSTRACT FROM AUTHOR]

The new interpretation (NI) offers a particular understanding of important problems in value theory, especially the value of money and labor power and the structure and dynamics of capitalist accumulation. The NI is to be welcomed for raising these issues but not for the way in which it has dealt with them. Above all, the NI falsely assumes that value is directly and immediately represented by money. The authors propose alternatives that emphasize the processes (mediations) through which value is expressed as price. They draw on an alternative methodology and understanding of money, the value of labor power, and production and circulation of capital in the context of accumulation. [ABSTRACT FROM AUTHOR]

Monetary theory based on commodity money possesses sound foundations for analysis of capitalist monetary phenomena. "Valueless" forms of money (fiat and credit) have their roots in the nature and functions of commodity money. The evolution of the form of money is explained by the adequacy of each particular form for the functions which money is called to perform in capitalist exchange. Performing these functions encourages the development of money's form, leading to the emergence of several types of non-commodity ("valueless") money. This paper considers especially the adequacy of commodity, fiat, and credit money as means of exchange; adequacy is fully specified by examining determination of the exchange value of these forms of money. The process of determination is different for each: spontaneous hoarding for the first, arbitrary specification of quantity for the second, credit advance and repayment for the third. In this context, it is shown that the intrinsic value of commodity money can play an anchoring role for money's exchange value. The quantity theory of money has explanatory power with regard to the exchange value of fiat money and, under certain conditions, of credit money. [ABSTRACT FROM AUTHOR]

Examines the importance of commodity money on the analysis of capitalist monetary phenomena. Emergence of several types of non-commodity money; Adequacy of commodity, fiat and credit money as a means of exchange; Determination of the exchange value of the forms of money.

The formation of money hoards, which underpins the demand for money, is typically treated by mainstream monetary theory as originating in the motives of the rational individual. In contrast, Marx’s discussion of money hoarding treats hoard formation as a necessary tendency of capitalist production and circulation rather than as a result of the individual’s predilections. Based on Marx’s analysis, this article identifies several structural reasons for money hoard formation in the circuit of capital. It is also shown that Marx’s discussion, despite its insight, suffers from a technical error in analysing the overlapping of production and circulation time in the circuit, and in drawing the implications for hoarding. Finally, it is argued that the broader significance of capitalist money hoarding lies in the foundations it provides for the emergence of the credit system. [ABSTRACT FROM AUTHOR]

This article reviews Robert Brenner's 'The Economics of Global Turbulence', New Left Review, May/June, 1998. Several decisive weaknesses of Brenner's contribution are identified. First, Brenner's theoretical treatment of capitalist competition and accumulation is in the spirit of Adam Smith and mainstream economics rather than Marx. Second, Brenner ignores the significance of credit for capitalist crisis. Third, he leaves entirely out of account the internationalisation of production and finance, phenomena which constitute the most salient feature of the contemporary global economy. Fourth, in short, Brenner's approach is not at all value-theoretic, a weakness that can also be found in some of his earlier historical work. [ABSTRACT FROM AUTHOR]

This article discusses various issues related to the transition and crisis in the Japanese financial system. The Japanese financial system has been in prolonged crisis throughout the 1990s. There is no single reason for these phenomena. Financial crises typically are complex events that express a variety of underlying contradictions and antagonisms of capitalist production and exchange. Important explanatory elements of the emergence of the Japanese financial "bubble" and of the especial difficulties of post-"bubble" restructuring, are to be found in the very process of financial deregulation attempted throughout the 1980s. This process arose spontaneously and it was not imposed from abroad. Still, deregulation began to influence the character of the Japanese financial system changing it from a bank-based, state-controlled structure aiming at the financing of industrial investment to a market-based, less-state-controlled structure characterized by the competitive profit maximization of financial institutions. In other words, from being a paradigmatic model of 'late developer' long-term industrial lending, the Japanese system began to move toward the market-based short-term lending Anglo-Saxon model.

A preface for the March 1999 issue of the journal "Capital & Class" is presented.