The source for this dramatic conclusion is legendary global investor Marc Faber.
Granted he is a contrarian – publisher of the “Doom, Boom & Gloom Report,” so he may just be talking his book. But his analysis suggests at a minimum the current attempt to suggest that the crisis is over should be taken with a grain of salt.
Berkeley Economist Oliver Williamson and Indiana University Political Scientist Elinor Ostrom shared the Nobel Prize this week.
My long time favorite for the prize has been Benoit Mandelbrot. Mandelbrot’s work on the behavior of prices in markets should have helped us avoid the recent financial collapse, but until very recently his work has been give far less attention than it deserves.
The book The Black Swan by Nassim Taleb is built off of the theoretical work of Mandelbrot.
Mandelbrot makes the point that the rational actor approach to the markets ignores the “wild” nature of actual pricing in financial markets. So-called “efficient markets” advocates mistakenly apply concepts borrowed from physics to markets, ignoring the absence of phenomenon like inertia in those markets. He argues that there is a fractal structure to pricing of financial assets that could be far more powerful in explaining the apparently inexplicable nature of financial markets.
Perhaps next year as the drama of the recent collapse of our financial markets has sunk in, Dr. Mandelbrot will finally gain the recognition he deserves.
Nonetheless, I am particularly pleased to have heard of Dr. Williamson’s award. I was trained in law school in his tradition, what is known broadly as the “new institutionalism” or “new institutional economics.” Most of my research today looks broadly at the importance of institutions as opposed to simple images of arms length markets in understanding how the world works.
I don’t talk too much here about my academic work but I do get asked about it from time to time so I thought I would update King Harvest readers. My general interest is in the impact of globalization on political and financial institutions. I am generally of the view that globalization is a very much more problematic process than is widely believed. I am also working closely with Jennifer Kuan at Stanford’s Institute of Economic Policy Research on institutional structures in our financial markets
First off, I have just put the finishing touches on a book, From Che to China: Labor and Authoritarianism in the New Global Economy. It will be issued by Vandeplas Publishing, an independent legal publisher, in the next month or so. It argues that the decline in industrial relations institutions such as collective bargaining in the advanced economies emerges just as globalization is posing critical questions of industrial relations in many new parts of the world such as Asia and eastern Europe. Unfortunately, authoritarian forms of labor organization are now being seen increasingly rather than support for the traditional democratic trade union. The book examines the question from several different angles and includes case studies as well as theoretical analysis. And I also attempt to point to alternative approaches for labor organizations. As soon as its up on Amazon I will let people know. Meanwhile you can read the chapter on Che Guevara here.
My work with Jennifer Kuan is progressing very nicely. We argue that the privatization of the NYSE through its 2006 IPO was actually damaging to the capital markets. The Old NYSE was actually a kind of socialistic entity – a mutual benefit corporation owned and governed by its members. That actually led to good things (for capitalism of course) and was quite stable. We made a preliminary argument in a law journal article we published in the Spring 2007 issue of the Duquesne Business Law Journal. You can find a working paper version here.
Now we have actual data and have been presenting it at various conferences, including the ISNIE meetings at UC Berkeley and a conference sponsored by the Sloan Foundation in Chicago. We presented a revised version again at IOFest at Berkeley a few days ago. We should have it in working paper shape soon and will post it to SSRN. My SSRN page is here.
I have just recently finished another paper called Beyond Berle and Means: Private Equity and the New Capitalist Order which will appear as a book chapter in a collection called The Embedded Firm edited by Peer Zumbansen of York’s Osgoode Hall and Cynthia Williams of the University of Illinois (who just finished a two year visit at Osgoode). A major British academic press is thought to be our publisher if all goes well. The book grew out of one of the best conferences I have attended recently organized by Osgoode in February of 2008 (maybe it was great because I found out while I was up there that my wife was pregnant with our first child!). I also presented the paper this summer in Paris at the SASE meetings (that’s Society for the Advancement of Socio-Economics). That was also a great event and our panel was very lively. An early version of the paper can be found here. A shorter and livelier version was published by Dissent magazine as well for whom I write occasionally. That piece led to some interesting reactions from European labor folks, some liked it while others were upset at my concern about what I called the “populist” nature of their attack on private equity.
Another project is a book on the Equal Rights Amendment just in the final stages and to be issued by an independent press called the Center for Socialist History in Berkeley. I co-authored that with the late Hal Draper – an earlier version was finished but never published. In light of the very wide gulf today between arguments about gender and class today I think it will make a very useful contribution to the debate.
That’s it for now. Feel free to visit my law school home page for occasional updates and of course I will report on significant items here from time to time.
The McClatchy Newspapers have picked up my op-ed on Richard Trumka, the new AFL-CIO President. So far it’s run in the Providence (RI) Journal, Buffalo News, Sacramento Bee, the Pittsburgh Tribune and the Bellingham (WA) Herald.
Here is the introduction:
America’s leading union federation, the AFL-CIO, just elevated longtime Secretary-Treasurer Richard Trumka to its presidency, replacing the plodding 75-year-old John Sweeney and providing hope that organized labor will finally get the breath of fresh air it has needed for many years.
To reverse labor’s slow descent into irrelevance will require a bold shift by Trumka, ironically perhaps, back to trade unionism’s first principles, including advocacy of “bread and butter” improvements in pay and working conditions and support for workers abroad.
Once before in its long history, American labor found itself socially isolated, facing intransigent employers, feckless politicians and a challenging combination of rapid technological change and a multi-ethnic immigrant workforce.
You can read the rest here.
The last surviving leader of the Warsaw Ghetto Uprising of 1943, Marek Edelman, is dead at 90.
WIth all of the cartoonish declarations by the likes of Beck, Hannity, Radosh and Horowitz about the alleged “socialist” politics of neo-stalinists like Bill Ayers and Van Jones, the sad passing of Edelman serves as a reminder of what a real socialist looked like through some of the worst periods of modern human history. Of course, Jones and Ayers think of themselves as radicals and “socialists” despite their affinity with authoritarian movements like that of Hugo Chavez, Castro and Daniel Ortega. Both sides in this strange collusion have an interest in perpetrating the myth.
Thus, despite the sadness of today’s news it offers a refreshing opportunity to consider the biography of a genuine socialist and radical.
Edelman was 23 when he took part in the ghetto uprising as a member of the Bund, a socialist and anti-zionist Jewish group. The Germans had walled off part of Warsaw and the Jews inside realized their eventual fate. Some 300,000 residents of the ghetto were sent to the gas chambers at Treblinka before the uprising. Despite sure failure some 200 mostly young Jews like Edelman formed the Jewish Fighing Organization and rose up and inflicted significant casualties on the Nazis. In the end more than 55,000 remaining Jewish residents were massacred. Edelman was a sub commander and rose to commander of the entire force when the uprising’s lead organizer Mordechai Anielewicz was killed.
I don’t cry easily but the tears were flowing when I watched this story this morning. It may have been because Tom LeClair is my cousin – we grew up together in Chicago.
Tom is probably the most selfless person I’ve ever met although he pointed out that he did this in part in memory of our other cousin, Tom Fielding, who gave a kidney to his sister, Jeri, some years back. Tom Fielding passed away a few years later at age 51. I wish I had half the courage of either one of these guys.
I spoke to Tom this afternoon and both he and the kidney recipient are doing well. Maybe Chicago has something to celebrate after all.
Good industrial jobs are increasingly hard to come by in the US. That’s why I hope KH readers will take a moment to click here and see how they can help Stella D’oro bakery workers keep their jobs in the Bronx where they have worked for nearly 80 years.
Here is a summary of the issues at stake:
On August 13, 2008, 136 members of Bakery, Confectionery, Tobacco Workers and Grain Millers International Union Local 50, employed at the historic Stella D’Oro plant in the Bronx, went on strike to defend their family-supporting wages and benefits.
Stella D’oro’s owner, CT-based private equity firm Brynwood Partners, was demanding wage cuts of up to 25% and unaffordable health care premium increases, among other concessions. Workers and community allies waged a brave 11-month strike to resist these demands.
In July 2009, the National Labor Relations Board ruled that Stella D’oro had bargained in bad faith and ordered the strikers returned to work with back pay! On the day workers returned to their jobs, Brynnwood Partners announced its intention to shutter the plant in 90 days. In September, they announced they would sell Stella D’Oro brand, inventory, and some machinery to NC-base snack-maker Lance, Inc. Lance said it would move production from the Bronx to a non-union facility.
The Stella D’Oro Biscuit Co. has been in the Bronx since the 1930s. BCTGM Local 50 has represented the workers at the Bronx plant since the early 1960’s, and has helped build Stella D’Oro into an American icon. Its workers are a cross-section of the vibrant communities of the Bronx.
Stella D’Oro workers enjoy broad support in NY for their cause. A vibrant support committee of neighborhood residents, union allies, and local community institutions has mobilized with workers since their strike began. The NY City Council passed a resolution supporting the workers and the NY Daily News has published numerous editorials in support of their cause.