Saturday, May 23, 2009

Jim Cramer's conversion to Marxism fails to attract notice

CNBC's noisy, opinionated investment advisor Jim Cramer made an outrageous statement about Karl Marx, saying the following in Time.



Do you believe we will look back on the financial innovations of the last several decades with regret?

"They almost brought our country down. The only guy who really called this right was Karl Marx. Marx understood what would happen if you let the market run amok. Of course, it was done by right-wing Republicans. They brought our nation to its knees, and we're not going to end up being a great power because of what happened."





It is outrageous in that a former Wall Streeter and popular TV guy on an investment channel is talking up the insight of Karl Marx. Second, he pivoted around and dumped on the Republicans. Wow, that seems overtly political for a journalist -- even a journalist-entertainer. I would have expected calls for his head.

This lead me to consider if Karl Marx really did call this recession. Karl wrote a lot of thoughtful pieces, and most of communism was really thought up by Lenin including the anti-democratic aspects.

It seems this false quote has been posted around the internet: 

"Owners of capital will stimulate the working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable. 

The unpaid debt will lead to bankruptcy of banks, which will have to be nationalised, and the State will have to take the road which will eventually lead to communism."  (Falsely attributed to Marx)

First Cramer probably believed the false Marx quote and was reacting to that. Second, it does not sound like something written in the 19th Century. On the other hand, it does sound like some modern anti-globalization leftists.  

It seems there are real Marx quotes about a credit crisis: "In a system of production, where the entire continuity of the reproduction process rests upon credit, a crisis must obviously occur — a tremendous rush for means of payment — when credit suddenly ceases and only cash payments have validity. At first glance, therefore, the whole crisis seems to be merely a credit and money crisis. And in fact it is only a question of the convertibility of bills of exchange into money."

I was thinking of wading into this, but Marx was very wordy. There is more stuff on marxism.org.