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Does this = the end of capitalism as we know it?

When a government has to step in to nationalise one ailing bank, it’s big news. When a government steps in to nationalise two ailing banks, it’s even bigger news. But when a government tries to splash out $700bn to ‘effectively nationalise’ a whole array of toxic mortgages and securities, capitalism’s cornerstones of weak regulation and a self-equilibrating market start looking a little shaky.

Given this is precisely what the US government had in mind under the failed Troubled Asset Relief Programme (TARP), where do we go from here? Germany’s finance minister has already called the end of Anglo-Saxon capitalism and the death of the US’s superpower status. Free market principles look as passé as Marxian ideology in the late 1990s.

Can capitalism bounce back? Or have recent events buried it for good? Your comments are welcomed below.

Comments (10)

  1. You’re missing the point. This is not the end of capitalism, but it will hasten its demise. The US is already beholden to states like China and Russia which operate their own state driven capitalist models. Another $700bn on the balance sheet is only going to enfeeble Western capitalism further. Its days are sadly numbered.

  2. Capitalism is dead. Long live capitalism.

  3. TARP is DEAD.

  4. I am not a big fan of capitalism. But claiming capitalism is dead is just going way too far from reality.

    What is captialism anyway? One thing for sure it is more than wall streetism. Even wall street is too early to be claimed dead.

    To me, the fundmental feature of capitalism is people own assets for generating wealth and they are entitled to profits.

    There are too many basic questions to be answered before anyone can claim capitalism dead.

  5. I disagree. Like companies, technology and even the economy; we are going through a paradigm shift. The economic landscape is only changing. With already too many banks failing within the last year and Goldman and Morgan prudently morphing into holding banks (something which contributed to the wall street crash) means the remaining banks will either find risk-taking more daunting or will either be highly regulated. Over the last decade, banks have been using derivatives as a covert means so complex that managers gave up pondering where they came from, only as long as there was a healthy bonus forthwith. We, as an economy, as a western society, are going through what nature has endured for millenia; -natural selection. Be gone with the absorbant, failed banks and let in the strong, with new keen and realistic strategies to ensure a healthy future for ourselves and offspring. The banks along with the governments have learned a dear lesson. Let it be.
    I say, long live capitalism.

  6. Capitalism is greed and a balance of greed (like a balance of everything) is healthy for society. Greed is part of survival.

    However, unregulated greed and uncapped capitalism leads to exploitation, and people have been exploited for years and have exploited others for years.

    We all exploit each other in our won way. The rich, by stealing from the poor, the Benefit Scrounges / unemployed single mothers from the taxpayer, the government from its people… and so on…

    That will not change- only a new kind of exploitation.

  7. Such a simplistic way of looking at greed and exploitation. Basicly, you are saying everybody is evil and let us indulge in it whenever we can. That’s exactly the kind of undefendable excuse that ecourages wall street high flyers to bring down the economy.

    While humans are not flawless, we should also remember that we are capable of being compassionate, pursuing justice and fairness.

    Maybe some individuals are more capable than others, therefore should be encouraged for high achievements and rewarded accordingly. But forgetting that as a society we are interdependent on each other can lead to excessive ego, demand for more that one deserves and unwillingness to give others the credit for one’s achievement.

    Absolute individualism is illusionary, self-fulfilling and dangerous.

  8. Well weitogo – what’s wrong with simplicity? Isn’t that the reason why things are go wrong- because there’s not enough simplicity in evidence?

    Anyway, referring to my point, I am not justifying greed, however, nor do I think its evil (which is a very judgemental and backwards method of viewing natural animal instincts).

    However, what I am trying to illustrate is that a balance of greed, (like a balance of everything) is required for a competitive “survival of the fittest” society to progress for the good.
    That does not equate to my thinking that bankers can exploit people. Additionally, like death, greed is not curable. It can only be regulated.

  9. Matrix Reloaded

  10. I agree, like it or not capitalism is about greed with a human face(social corporate responsibility). since it’s meant to be laissez faire it’s hard to keep greed in check. in the end the fittest survive but then this could turn into a very unhealthy monopoly. but i don’t think it is the ned of capitalism. perhaps the end of capitalism as we know it

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