Alternative Theories of Money and Finance
New Directions in Modern Economics series
The recent onset of the most severe, synchronized global economic slump since the 1930s depression has rekindled controversies over the contradictory ‘laws of motion’ of capitalism and the very nature of capitalist money in the wake of the global financial meltdown, which preceded the slump. The evidence suggests that these recurrent crises have become more frequent, severe and prolonged during the neoliberal era from the mid-1970s onward and appear to have coincided with the policies of financial deregulation enacted during this period. Many heterodox critics have argued that the phenomenon of ‘financialization’ lies at the very core of these recurrent financial crises. The aim of this study is to examine the dynamics of these debilitating phases of financial instability from a theoretical perspective. What are the implications of financialization? Does the present conjuncture signify the final historical vestiges of the neoliberal project? More importantly, what is the nature of specifically capitalist money? These are quite profound questions which attempt to reveal the pathologies of the present phase of capitalist evolution and the inherent instability of deregulated financial markets. In a broader historical context, capitalist crises are functional and strategic. These crises signify the culmination of one process and the beginning of another. In a continuous, latent process of transformation, all of the subterranean, conflicting forces come to the surface and bring to light the very paradoxes of history itself. Through the dynamics of catharsis and reconstruction, capitalist crises provide the material basis by which profitability is restored once again. The...