Karl Polanyi wrote The Great Transformation in 1944. It is argues, among other things, that markets (including financial markets) affect the way society is structured and organised and that un-regulated markets are harmful for society. Michael Burawoy drew on the book for a talk at one of the most interesting sessions at the recent International Sociology Association Conference, so last Thursday I started reading my old copy. On Monday, the Financial markets began to collapse. Howszat for synergy! I don't want to suggest that the world is reacting to my choice of reading material, that way lies madness, but still, I'll be thinking a little more carefully about what I read next. So the financial markets are in chaos and the Progressive Democrats are falling apart. Itâ€™s not really surprising they have declined, the idea that unregulated markets are good for society has been soundly thrashed in the last couple days. Neo-liberalism has taken quite a bashing. Regulation of markets is back on the agenda, with both US presidential candidates murmuring that â€œsomething must be doneâ€. The trouble is that Pandora is out of the box. As this article on financial instruments argues, the extent and range of financial instruments, and the ease with which they are traded globally, makes it very difficult for national states to roll back to the glory years of Keynesism.
Finally, one more link, this selection of slides is a nice introduction to the sub-prime market.