"Prof David McNally writes: I have never accepted the postmodernist contention that contemporary capitalism is all about smoke and mirrors. The notion that ideology and illusion make the system go round strikes me as another mode of reductionism – this one based on culture rather than, say, economics. But it must be said that, at first blush, the mainstream business media certainly offers some sustenance for the smoke and mirrors thesis.
Consider, for instance, new data showing that as of November the slump in U.S. housing prices had surpassed that of the 1930s. For 53 consecutive months American home prices have fallen. What's more, their 26 per cent drop on average since 2006 exceeds the home price meltdown of the first five years of the Great Depression (see here).
None of this seems to faze the vast majority of business commentators, who display a manic ability to shrug off such facts in favour of any uptick they can find in some economic indicator or other. This is then quickly trumpeted as proof that the long-awaited recovery is underway and that all will soon be right with global capitalism.
So it was that on Monday Jim O'Neill, chairman of Goldman Sachs Asset Management, proclaimed in the Financial Times that “This will be the year of the U.S. comeback.” This followed on the heels of numerous claims in the same vein that dotted my daily newspaper last week, including one headed “The recovery is on.”
at http://www.marketoracle.co.uk/Article25615.html
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