Marxism Unmasked from Delusion to Destruction.pdf 7471KB

development of economic condidom that takes place in all countries
with capitaUsm does not proceed steadiK- upu-ard, but follou-s a >*'avT-likc
movement, a movement in which there are repeated boom periods that
always are followed b\ penods of depression." In this wzy the crisis
problem was transformed into the problem of the trade cycle. And fbr
the problem of the trade cvcle man>' more or less ^Tong explanaoons
were offered.
1 want to mention only one. This u-as the doctrine of an ocfacrwisc
famous economist. Willum Stanle> Je\T>ns (1835-1882). Hb doctrine
acquired some fame. He attributed economic crises to sunspots. He said
that sunspots bring about bad harvrsts. and this means bad business. If this
was so. why then didn't business adjust to this natural phenomenon as it
learned to adjust to other natural phenomena?
If there is credit expansion, it must necessarily kwMrr the rate of
interest. If the banks arc to find borrtn%rn for additional credit. the\ must
lower the rate of interest or lourr the credit qualihcations ol* \A\Hild-be
borrowers. Because all those who u-anted loans 4t the prrsious rate of
interest had gotten them, the banks must either offer loans at a los%rr
interest rjtc or include in the class of businesses to whom kvun are granted
at the presious rule le\s-pn>iiiising businesses, petiple ol lo^^rr credit qualits
When indisiduals it>rnuine less than the> pcnduce. the surpliix
pnxluction is set aside a% \as-ingv Thus when the nKme\- gnm out in loatu
mmc\ fn>m vasrrs. it reprrsrnts actual g«xxit whK'h are a\*ailable for further
priHluction. Hut when the loan« are granted out ol credit expanvion.
buMncNMiien are miUed. there are no g«Hxls staf>ding behind them. onK
newly created credit I hi% leads to a laKifiiatKin of eiiMKHtiK cakubtion
C'redit expansion brings about i %>^enutu taKification— tf gnrs to the
indivuUul buMiiewnun the tmprrwiitn that j pn>jeit that couldn't be
cxci uicd \TMcriljv Ix-i ju\c there \srre ihm en«>ugh capital gixxK. can nos*
be cxcmtcd on acvouiit of the credit expansion A» j result, there » an
intciiMfu jiion i>t buMiicM activirs. which meam that higher prices are
offered for the lacti>rs ni pnxluction But there has hern no increase in the
quantity ot c jpital ginxK Therefore the intenuficatM^n f business actmrv
incjiiN an artifuial Khmii Pnxluccrx c»f factor* of pnxluction arr happs
when thcv sec thai the prurc thes are getting are higher than the\
were \eNtcaiav But ihi\ cannot go on foresrr. because no nK>fr nuterial
factors of prxxluction hasr been ptxxiuced The prKes ol' these CKton of
pnxluction are going up more and more as Kwttmrrs of the new credit
compete and bid up their prices I hen tinallv t\%\j akernatnrs are possible