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Economy Title: Nouriel 'Dr. Doom' Roubini: ‘Karl Marx Was Right’ Companies, Roubini said, are motivated to minimize costs, to save and stockpile cash, but this leads to less money in the hands of employees, which means they have less money to spend and flow back to companies. Now, in the current financial crisis, consumers, in addition to having less money to spend due to the above, are also motivated to minimize costs, to save and stockpile cash, magnifying the effect of less money flowing back to companies. "Karl Marx had it right," Roubini said in an interview with wsj.com. "At some point capitalism can self-destroy itself. That's because you can not keep on shifting income from labor to capital without not having an excess capacity and a lack of aggregate demand. We thought that markets work. They are not working. What's individually rational ... is a self-destructive process." Post Comment Private Reply Ignore Thread Top • Page Up • Full Thread • Page Down • Bottom/Latest Begin Trace Mode for Comment # 9. you can not keep on shifting income from labor to capital without not having an excess capacity and a lack of aggregate demand. We thought that markets work. They are not working. Business people know this and don't just sit on cash. Henry Ford realized that he had to pay his workers enough so that they could afford to buy one of his cars. Then the unions got greedy... and along came VW, Toyota, and Honda. Detroit is now a socialist paradise. The reason that the "markets are not working" and the economy stinks, is a long series of government screw ups, printing funny money, thousands of special interest (globalist) regulations on both business and consumers. D&R politicians take the bribes, and we the people get screwed. It's our own fault for voting for Democrats and Republicans.
#9. To: hondo68, lucysmom (#4) (Edited) . Then the unions got greedy... and along came VW, Toyota, and Honda. Detroit is now a socialist paradise. What bullshit on Hondo's part and those on the GOP that keep repeating this. VW, Toyota and Honda are produced in nations so called conservatives would call "socialist" (German and Japan) where there are powerful trade unions. Overall, Germany and Japan's manufacturing sector is doing better than the American one where deregulation and union busting have been the norm for 30 years. So here we have shattered 30 year old Republican conservative assumptions but the GOP hacks are still repeating the dogma. We have American unions at their weakest and low nd behold manufacturing is not rebounding, wages have been lowered over the 30 years and the American workers benefits have been their lowest ever and that has not helped the economy rebound. At what point will the conservative right wing admit their economic philosophy is a failure? That it does not produce the desired end results?
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