Showing posts with label capital. Show all posts
Showing posts with label capital. Show all posts

Sunday, 4 February 2018

Prıces tell you everythıng

Among investors, there is widespread belief that the stock market can "beat" or outrank it.US economist Eugene Fama opposed it.Efficient Capital Markets (1970) claimed that it was not possible to constantly defeat the market.The theory is known as the efficient market hypothesis.

                 Eugene Fama,claimed that all investors were able to access publicly accessible information like competitors, thus reflecting the entirety of fully accessible information on share prices.This is "productive market." Nobody knows what new information will be disclosed, and it is almost impossible for investors to make profit without having access to information that the rival can not reach, or doing illegal "insider trading"

                However behavioral economists are focused on the problems of the hypothesis.Investors are overly reliant on something and point to the weakness of the "herd" instinct to explain it.These problems manifested themselves in the Dotcom balloon of the 1990s and the more recent 2007-2008 financial crisis, when it was held responsible for artificially inflating "irrational zeal" technology shares.

               Following these crises, many observers declared that the theory was unnecessary; some even blamed this theory for collapse.Eugene Fama had to accept that uninformed investors could make the market worse and that prices could be somehow "irrationally".













Wednesday, 8 March 2017

Karl Marx:Principle of Infinite Capital Accumulation

In 1867 Marx,after half a year of published Ricardo's ''Principles' ,when he published Capital's 1st volume,economic and social truths has deeply changed:The question is whether agriculture will now feed an increasing population or the question of whether the price of the soil will increase or not,rather it became a matter of understanding the dynamics of industrial capitalism as a whole.

            The most stunning fact of this period,is the misery of the industrial proletariat.Despite growing in the economy at the same time, due to migration from rural to urban, which is caused by the increase in population and agricultural productivity,workers began to accumulate in slums in cities.Prices were low,working times were long.A new urban misery,is visible,more shocking and from some angles,was more miserable than, which was common in Ancient Regime.Inspired by the timid arrangement of 1841 Le Tableau de L'état physique et moral des ouvriers employés dans les manufactures (The Table of the Physical and Moral Status of Workers in Manufactures)  published by Dr.Villerme in France and in England.Depicting the same terrible truth which published by Engels in 1845 Die Lage der arbeitenden Klasse in England(The status of the working class in England) too.

             In fact,the historical truths that we have today,however when we came in the second period of to19th century,it showed to us there is a evident increase purchasing power.From 1800-1810 years to 1850-1860 years,the salaries of workers remained very low.Like France that we can see it in England to,long recession in wages, in this period with became remarkable with the gain speed of economic growth.In every case the labor factor is stagnant in income,increase in capital and industrial profits-in 1840-1850 time period- it is a fact that everyone is aware of.The first Socialist and Communist emergence of movements took place in this context.The basic question asked is fairly simple:After half a century of growth,if the living conditions of the masses are still miserable and beside prohibition of 8 years old children working in factories,if there is nothing the development of in industry,all these techniques progress,all these labor, all these migrantions. What does it do? It is clear that the current economic and political system has gone bankrupt.Everyone wondering the other question:What can we say such a system that in long-term?

               Marx knew the answer.In 1848,on the eve of the ''Spring of People'' , to begin with ''A ghost wanders in Europe,the ghost of communism.''  effective and short text, Das Kommunistischen Manifest (Communist Manifesto) was published.This text,ending with the revolutionary vision that was famous as the beginning:so the development of the modern industry,based on the fact that the bourgeoisie produces its products and products based on property acquired.It takes away from the bourgeoisie.The bourgeoisie brings its own end to everything first.The victory of the proletariat in its end was equally inevitable.

           Over the next twenty years,Marx will justify this result,he will establish the capitalism and its collapse with making a scientific analysis,he really spent his time to write voluminous analysis.His work couldn't reach to comlete: 1st-Volume of Capital's was published in 1867,however Marx couldn't complete the other two following volumes,he was died in 1883.Engels-his friend- published these two volumes after his death, bringing together the sometimes inexplicable parts of manuscripts left behind Marx.

         Like Ricardo, Marx established his own works on the analysis of capitalist system own logic contradictions too.At the same time (The Secret Hand of Adam Smith,Each supply creates its own demand of Jean-Baptiste Say.....in line with the law,the market regulate itself.) Without offering bourgeois economists and real scientific work on economic processes only that the workers think they deserve to criticize the misery,aimed to stand in a different place than the utopians.To summarize it,Marx based on the model Ricardo has developed on the price of the capital and on the principle of scarcity,at first Marx said capital doesn't based on soil,it does industrial and in a world where the principle could accumulate indefinitely, he further advance it with an analysis of the dynamics of the stock.As a result,his results,we can named as ''Infinite Accumulation Principle'' The capital has a relentless tendency to accumulate without accepting any natural limits and to concentrate in the hands of very few people.It was the starting point of Marx's foresight of doomsday at the end of capitalism:Either the capital's return rate will tend to decrease(it stops the accumulation process or between in owner of capital it could lead to a violent conflict) or the share of the national capital will increase unlimitedly(all the workers in the world will unite and rebel in the end.) Reaching a socio-economic or political balance did not seem possible in both cases.

             At the end of the 19th century the prices started to increase:Stubbornly,The inequality remained on same degree,but from some angles to The World War 1 it was increased,improvement in purchasing power was spreaded to everyone,this one changed that status from radical.No doubt communist revolution was happened,however from the most undeveloped country of europe;Russia, where the industrial revolution has barely begunLike before from self authors, Marx had also overlooked the possibility that the technical progress was continuous and that the productivity increased steadily too; in the increases in productivity,the accumulation of capital and  processes of condensation, it is a power which will be able to balanced it to certain degree.Marx,owned estimates do not have statistical data to make it more accurate.It was probably the victim of finalizing the results in 1848, before they entered research that could confirm them.Clearly,Marx was writing in a great political environment.Which in many cases led to him,difficult to avoid or shortcut results.It is precisely from this point that the theoretical discourse as far as possible is based on complete historical sources;but it can not be said that Marx did this to the extent possible.

           Despite all this,we will see that Marxist analysis makes correct determinations in many respects.Marx started with a real question and tried to find an answer with the possibilities:The Infinite Accumulation Principle put forward by Marx is also important not only in the 19th century
it also important for analyzing of the present 21st century too.If the increase in population and productivity is low, then the accumulated wealth is also of considerable importance,it destroys social stability when if this accumulation becomes excessive.In other words, a weak growth, fails to properly balance the Marxist infinite accumulation principle: the resulting outcome is a balance that will not be outdone, even if it is not like the doomsday as Marx predicted.Accumulation stops at one point, but it may be at an excessively high or at destabilizing point.We will see that the strong increase in the total value of the special wealth, measured as the national income since the 1970-1980 period, in all of the rich countries, especially in Europe and Japan, directly reflects this rationale.

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Friday, 24 February 2017

Capitalism ''Founder of Economics''


CAPITALISM


          Some of authors said ''It wasn't born in UK first.'' They said '' It was emerged in medieval 17th Italy and Netherland.However, capitalism, as a whole, both economic and social processes and relations that lag behind the commercial and production for profit, came to the forefront in the 18th century in UK. Propulsive force of capitalism, expansion,exploitation,oligarchic management this three were the respond of search of systematic requirement.Capitalism will be possible by fulfilling these requirements - but only if and only if,as long as it strengthens and remains strong colonialism,industrialism,nationalism. If all of this fulfilled and the development of enough elements from its pioneer elements also gives life to capitalism.Politically, it is the system of laissez-faire (freedom).
          Economy, was born with capitalism. No doubt,the ''economic'' activities was also present before capitalism.But these activities: Ancient, medium, early, modern, in the ages, the social formations continued in whole of institutional and social values.They did not control the larger social processes.Adam Smith came up with an suggestion of "an economic system" that could be left it "its own" whose source is laissez-faire for the first time.
           What leaves the traditional economy theory vulnerable? I think '' Policy, comes before Theory.' Ideas and contributions in the development of theory, by theorist; seen,perceived,comprehended, perceivable of strain or effect socio-political problems and in the framework of possibilities,emerged.
           Priority generalizations,in their most obvious forms of 'mercantilist' are seen in the policy brochures of the 17th and 18th centuries.Actually these reports, related with about commercial or industrial branches for the start a policy,change or end, it addressed to state.
Generalities, it was visible much more depth and container theorists too.
           Different by each others, Adam Smith,Karl Marx and J.M Keynes,respectively,
theoreticians who said that ,capitalism wants to pay attention, they had to be need demolished and saved.

BIRTH:

ORIGIN OF CAPITALISM


           Meaning of capital, principal money,all commodities for convertible into money.Capital is concrete reality.It is constantly active and effective.it masses of tools that are easily recognizable.Capisalist, a person who oriented the capital in never-ending production process. But this for the be able to deserve the name it should join recurring production process.Unused money - in treasury money - it wasn't capital,at the same time unused forest too.






Sunday, 19 February 2017

Mercantilist Doctrine




MERCANTILISM



        In West Europe countries, with the end of the medieval and period between industrial revolution, it appears with collapse of feudalism and establishment of strong central states.Economically, this epoch was ,the conditions of the preparing capital accumulation and market economy, while commercial capitalism's the age of development.Mercantilism, reflecting the ideology of the new commercial capitalist class as '' Economic Policy'' , roughly it was determined the principles of ''Economic Policy'' of national countries for three centuries.


''Economic Policy'' phrase used first by Mercantilists.


Conditions That Prepare The Economic Infrastructure and Economic Thinking

        Towards the end of the medieval ages,Some of factors, it will be change the economic bases of western european society,emerged.Once, trade expanded with overseas explorations.Followed by gold flowing to Europe,it raised the prices and it enlarged the commercial capital and it opened profitable new business sectors, on the other hand immovable property revenues and living nobility. it made them poor.Secondly,changes in agricultural production techniques destroyed to subsistence traditional economy order.Agricultural production changed own ways to market,it became bound with market laws to commercial capital.With the possibilities of increased profit in commercial, it was effective to development in ''individualism'' ,the movement of Reformation in Religion and Renaissance and humanism.

        The commercial devolopments, it made conflicting the merchants interests,they started to need central guards to save them from opponents.Establishment of the Monarchy and Central countries,beside the development of commercial it made possible to apply Economy Policy.Mercantilists said ''The profit of Merchants was identical with national interests,it was form of strong of country.'' For the merchants have a identicals with national interests,mercantilist doctrine as '' Monarchy and newly developed countries '' approximately it was represented the ''Economic Thought''' for three hundreds centuries.



Economic Thought of Mercantilism



     Basic Principles



  1. Mercantilists brought principle of love and loyalty to gold and valuable metals.
  2. For them there was a only one important things its as large as possible to collect,save gold and silver.
  3. They believed that Economy Policy had to be a protector and statist before everything else.
  4. For their military interests they tried to encourage population growth.


       ''Residual'' known by Mercantilists, it can only be achieved with foreign commercial balance.


        One country became rich while another country became poor. Mercantilists knew that so they confirmed, there was conflict of interest of countries.Protectionism in foreign commercial,it was became their 'foreign commercial policy.' This thought completely different from ''Liberal Economic Doctrine.''
        Mercantilists really care of with money,especially they regarded money as identical with capital,this situation needs to provide more by in foreign trade balance protection policy.In the related ages and countries currency was gold and silver metals.The banking system has not improved enough.Under these conditions,the only to increase the valuable mine supply - the related valuable mine as long as it is not produced in the country - thanks to foreign commercial balance, to country , to provide to valuable mine entry.



Mercantilists said ''The greatest treasure of a country, a well-nourished population.''



National Wealth Concept


          Mercantilism '' national wealth '' tended to keep the interests of merchants in the foreground.The countries power being in wealth.Wealth occurred from valuable metal mine.
The valuable metal mines obtained from foreign commercial surplus.



Countries Merkantilist Policy

Has become '' economic policy '' system that shows differences in every country of Europe.It has not been a ordinary system.

  1. British-Holland School:This school's members directed theirs ways to free commercial and production. This school became ''Merchants' Thought.'' more than others.
  2. French School(Colbertism):They supported state handed industrialization.
  3. German School(Cameralists):They gave their importance to state finance and state management;their publications have written by public enterprise directors, university profs, government advisors.
  4. Italian-Spain School:They focused on money subjects;Reason of being Catholic they couldn't get rid of medieval thoughts.