What we don’t see…

22 August 2011

What we don’t see…

The market is nervous. Yet we don’t see this nervous market. Where is ‘the market’ actually located? Everywhere – in New York, Tokyo, Amsterdam, and so on, like some sort of international homeless drifter.

By Remi Poppe

Remi PoppeWhat we do see are computer screens, a great number of computer screens. Endless rows of figures, in green (okay), or red (not okay). Clearly the colour of the nervous market. Sitting before them men (for the most part) with moist upper lips, staring at the screens. One thing is obvious. If the figures are red then large numbers of shares will be sold and the price of these shares will fall. What this means is, however, not so obvious. Are they sold at a profit or at a loss? If they’re sold for a reasonable price, can the ‘panic selling’ nevertheless deliver a profit? Of this very little is said. Yet the markets can indeed plummet, and that must be a terrible thing, to be nervous.

Happily enough, medicine is on hand. The European Central Bank is putting money ‘into the market’. The US may lift the ceiling on its sovereign debt by unimaginable billions, printing dollars. The goal is to make the market a bit less nervous. So if large numbers of shareholders sell their shares, the government intervenes. Still, this looks a lot like monetary perversity, because if the stock exchanges pick up again, these sellers of shares will quickly become buyers, even though they just the day before sold their shares with no loss whatsoever, or with hardly any. Yet those rows of red figures on the computer screens will dwindle away. And the stock markets end once again ‘in profit’.

What we don’t see is where the real value of all these billions-worth of securities comes from. As if money can simply give birth to more money. And as if once again profits are recorded from securities, will ‘the market’ then also pay off the debts? This has never been seen to occur. When things are going well, then we’re always told to save for later, and when there are losses we have to make spending cuts.

‘We’ – that’s to say not the sweatily nervous traders on the stock exchange floors, but the people who make things of real value. The working class as it used to be called. It is strange that firms which were until recently profitable are suddenly worth much less because the value of their shares has fallen. Because the market’s nervous. On the floor of the stock exchange it’s all about emotion, according to the experts. Or is it not rather because with this same ‘emotion’ shares are bought at greatly inflated prices by profit-hungry investors. And then their bonuses and golden handshakes could go back up. Because ‘their’ firm did after all perform well, don’t you see? Speculation and profiteering, they are what we have to name as the source of the disaster, rather than a nervous market or the emotions of the shareholders.

And it's just for these reasons such a bitter thing when we see that unemployment in the Netherlands alone has again increased, to over 400,000. While, despite this, products are being made for which there is a need and until recently, and even now, massive profits are being recorded. It's incredible to see that the production of and trade in arms, and so war, are forging ahead as never before. We have seen this in crisis after crisis of the capitalist system. There are very few people still alive who have experienced the consequences. But we should never forget!

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