The Financialization of Capitalism

Foster, John Bellamy

doi:10.14452/mr-058-11-2007-04_1

Cited by 176 publications

(122 citation statements)

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“…(pp. 611-612) Various writers cite the importance of the work of Sweezy and Magdoff in the 1970s in articulating financialization, anticipating its development, and developing insight into its dynamics (see Bellamy Foster, 2007Lapavitsas, 2011). Bellamy Foster, in particular, has developed useful integrations of this literature that are relatively straightforward and easy to understand (2007,2010).…”

Section: Financializationmentioning

confidence: 99%

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Biosurveillance as a Terrain of Innovation in an Era of Monopoly Finance Capital

Magnusson

2013

Policy Futures in Education

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Situated in a context of higher education policy, this article examines the institutionalization of 'innovation' as a national neoliberal economic strategy. As neoliberal capital has become increasingly financialized, this innovation strategy has come to be woven through biotechnological innovation as an economic strategy, and oriented to the politics of permanent war. Following a 'strong-state' thesis, relations of monopoly finance capital increasingly organize knowledge production within higher education and the need for technological innovation related to national security. The author shows that the resulting academic cultures of innovation are heavily invested in subordinating research in the areas of health and environment to military strategy in order to achieve full spectrum global systems of biosurveillance.I have written this article from my location as a higher education researcher who has been studying and mapping out how neoliberal economic policy has been reshaping postsecondary education. More recently, I have turned my attention to the increasingly evident transformation of higher education systems brought about through their contact with, and irresistible pull into, the economic orbits characterizing the financialization of capital. As Bellamy Foster (e.g. 2010) points out, the financialization of capital goes hand in hand with the topics of neoliberal economics and globalization, and yet has received relatively little attention. This article aims to correct this paucity by examining how relations of monopoly finance capital have deeply penetrated knowledge production in the areas of biotechnology and communications through the institutionalization of 'innovation' policies. The resulting academic cultures of innovation, I will show, are heavily invested in subordinating research in the areas of health and environment to military strategy in order to achieve full spectrum global systems of biosurveillance.

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Section: Financializationmentioning

confidence: 99%

“…The overall effect is, of course, even greater stagnation. At this point, it does not make sense in terms of accumulation to reinvest in productive capacity, as there is already a building up of excess productive capacity, and, as outlined by Bellamy Foster (2007), 'little room for investment in capacity'. Bellamy Foster continues:…”

Section: Financializationmentioning

confidence: 99%

Biosurveillance as a Terrain of Innovation in an Era of Monopoly Finance Capital

Magnusson

2013

Policy Futures in Education

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“…Financialization describes a process of economic change in which the structure of advanced economies has shifted increasingly towards the provision of financial services and where the value of financial assets exceeds that of tangible assets. Foster (2007) notes that: "Although orthodox economists have long assumed that productive investment and financial investment are tied together-working on the simplistic assumption that the saver purchases a financial claim to real assets from the entrepreneur who then uses the money thus acquired to expand production-this has long been known to be false.…”

Section: Mortgaging Us Householdsmentioning

confidence: 99%

When it comes to the crunch: What are the drivers of the US banking crisis?

Heilpern

Haslam²,

Andersson

2009

Accounting Forum

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This article considers how permissive regulatory conditions helped change the size and scope of the US mortgage market. Asset backed securitization facilitated an expansion of the US mortgage market and modified the structure of the value chain within which financial assets, risk and liquidity were managed. New sophisticated mortgage products, indulgent lending practices, loose credit assessment and flimsy documentation increased the probability of mortgage default in an economic downturn. US banks were not in a position to absorb mark to market losses on mortgage assets and goodwill impairment resulting from a credit crunch because they operate with narrow profit margins and a limited equity cushion in the balance sheet. This article questions the viability and sustainability of this banking business model.

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“…According to Foster (2007), the origin of the term financialization is uncertain, but was first used in the early 1990s. As evidence, Foster (2007) mentions the studies by Phillips (1993Phillips ( , 1994, although does not refer to previous works (before the 1990s) that used the term.…”

mentioning

confidence: 99%

“…As evidence, Foster (2007) mentions the studies by Phillips (1993Phillips ( , 1994, although does not refer to previous works (before the 1990s) that used the term. According to the author, even though these studies did not use the term financialization, some of them drew attention to the growing importance of finance in capitalism.…”

mentioning

confidence: 99%

For a political economy of financialization: theory and evidence

et al. 2017

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The end of the Bretton Woods agreement led not only to changes in the international economic relations, but also in the very way in which capitalism functions. The liberalization of capital flows and deregulation and integration of financial markets under US leadership gave rise to a new systemic pattern of wealth, financialization, in which operations with financial assets received increased importance in the management of wealth by households and enterprises, and not only by banks and the other financial market institutions. Unlike most recent interpretations of this phenomenon, this one does not indicate a tendency of the system towards stagnation, but rather an increase in the instability that characterizes it, reinforcing the moments of expansion, contraction, as well as leading to crises. In fact, with the generalization and the dominance of finance, borrowing and spending decisions by enterprises and households are now increasingly responsible for current and expected fluctuations in the stock of wealth, which in turn are responsive to current and expected fluctuations in the prices of financial assets. This implies a transformation in the relationship between the state and the market, with central banks and national treasures becoming hostage to the need to prevent private losses and the perverse effects they may exercise over output, income and employment levels of the economy.Keywords: Financialization; Contemporary capitalism; Economic dynamic; Instability; Inequality. ResumoPor uma economia política da financeirização: teoria e evidências O fim do arranjo de Bretton Woods ensejou não apenas uma mudança na forma de funcionamento das relações econômicas em âmbito mundial, mas também no próprio modo de operação do capitalismo. A liberalização dos fluxos de capitais e a desregulamentação e integração dos mercados financeiros internacionais sob a liderança dos Estados Unidos deu origem a um novo padrão sistêmico de riqueza, a financeirização, em que as operações financeiras ganham importância cada vez maior na gestão de ativos e passivos por parte das famílias e das empresas, e não apenas de instituições do mercado financeiro. Ao contrário do que sugerem interpretações mais recentes sobre esse fenômeno, isso não significa uma tendência do sistema à estagnação, mas um aumento da sua instabilidade característica, reforçando os momentos de expansão, mas também de contração. De fato, com a generalização e a  Article received on April 10, 2017 and approved on September 18, 2017. ** Professors at the Institute of Economics -University of Campinas, Campinas, SP, Brazil. E-mails: bragajcs@uol.com.br; giulianoliveira@gmail.com; alex.wilhans@gmail.com; simonededeos@gmail.com. *** PhD student in Economics at the Institute of Economics -University of Campinas, Campinas, SP, Brazil. E-mail: paulowwolf@gmail.com. dominância da lógica financeira as decisões de endividamento e de gasto das empresas e das famílias passaram a ser crescentemente sensíveis às oscilações correntes e esperadas nos estoques de riqueza,...

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The Financialization of Capitalism

Cited by 176 publications

References 12 publications

Biosurveillance as a Terrain of Innovation in an Era of Monopoly Finance Capital

Biosurveillance as a Terrain of Innovation in an Era of Monopoly Finance Capital

When it comes to the crunch: What are the drivers of the US banking crisis?

For a political economy of financialization: theory and evidence

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