Cookies Policy
X

This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies.

I accept this policy

Find out more here

Why We Need to Understand Derivatives in Relation to Money: A Reply to Tony Norfield

No metrics data to plot.
The attempt to load metrics for this article has failed.
The attempt to plot a graph for these metrics has failed.
MyBook is a cheap paperback edition of the original book and will be sold at uniform, low price.

Buy this article

Price:
$30.00+ Tax (if applicable)
Add to Favorites

image of Historical Materialism

Abstract The issue of the relation between financial derivatives, money and crisis remains one of on-going debate within Marxism. This paper takes issue with a recent contribution to this debate by Tony Norfield. We contend that the relationship between financial derivatives and the concept of ‘money’ needs to be framed in the context of a changing understanding of liquidity, and that issues of crisis and renewed accumulation are better understood though this path than via debates about speculative versus real investment and productive versus unproductive capital. Indeed these latter taxonomies are being superseded by current developments within finance, and Marxian analysis needs to be attuned to these current developments.

1. Bank for International Settlements "‘Triennial Central Bank Survey Report on Global Foreign Exchange Market Activity in 2010’" 2010 available at: < >
2. Board of Governors of the Federal Reserve System "‘Credit and Liquidity Programs and the Balance Sheet’" 2011 30 November, available at: < >
3. Callinicos Alex "‘Contradictions of Austerity’" Cambridge Journal of Economics 2012 Vol 36 1 65 77 http://dx.doi.org/10.1093/cje/ber026
4. Chen Qianying , Filardo Andrew , He Dong , Zhu Feng "‘International Spillovers of Central Bank Balance Sheet Policies’" BIS Papers 2011 Vol 66 available at: < >
5. dos Santos Paolo L. "‘On the Content of Banking in Contemporary Capitalism’" Historical Materialism 2009 Vol 17 2 180 213 http://dx.doi.org/10.1163/156920609X436171
6. Financial Times "‘ Financial TimesLexicon: M0, M1, M2, M3, M4’" n.d. available at: < >
7. Fine Ben "‘Locating Financialisation’" Historical Materialism 2010 Vol 18 2 97 116 http://dx.doi.org/10.1163/156920610X512453
8. Fisher Paul "‘News Release – The Corporate Sector and the Bank of England’s Asset Purchases – Speech by Paul Fisher’" 2010 Monetary Policy Committee, Bank of England, February, speech delivered at the Association of Corporate Treasurers, Paper 18, available at: < >
9. Ingham Geoffrey "‘Fundamentals of a Theory of Money: Untangling Fine, Lapavitsas and Zelizer’" Economy and Society 2001 Vol 30 3 304 323 http://dx.doi.org/10.1080/03085140120071215
10. Ingham Geoffrey The Nature of Money 2004 Cambridge Polity Press
11. Keynes John Maynard Moggridge Donald " Treatise on Money: Volume 1: The Pure Theory of Money " The Collected Writings of John Maynard Keynes 1971 [1930] Vol 5 London Macmillan for the Royal Economic Society
12. Lapavitsas Costas "‘Money and the Analysis of Capitalism: The Significance of Commodity Money’" Review of Radical Political Economics 2000 Vol 32 4 631 656 http://dx.doi.org/10.1177/048661340003200404
13. Lapavitsas Costas "‘The Emergence of Money in Commodity Exchange, or Money as Monopolist of the Ability to Buy’" Review of Political Economy 2005 Vol 17 4 549 569 http://dx.doi.org/10.1080/09538250500252823
14. Lapavitsas Costas "‘Relations of Power and Trust in Contemporary Finance’" Historical Materialism 2006 Vol 14 1 129 154 http://dx.doi.org/10.1163/156920606776690956
15. Lapavitsas Costas "‘Financialised Capitalism: Crisis and Financial Expropriation’" Historical Materialism 2009 Vol 17 2 114 148 http://dx.doi.org/10.1163/156920609X436153
16. Lapavitsas Costas "‘Theorizing Financialization’" Work, Employment and Society 2011 Vol 25 4 611 626 http://dx.doi.org/10.1177/0950017011419708
17. McNally David "‘From Financial Crisis to World-Slump: Accumulation, Financialisation, and the Global Slowdown’" Historical Materialism 2009 Vol 17 2 35 83 http://dx.doi.org/10.1163/156920609X436117
18. Miller Merton H. "‘The Modigliani-Miller Propositions after Thirty Years’" Journal of Economic Perspectives 1988 Vol 2 4 99 120 http://dx.doi.org/10.1257/jep.2.4.99
19. Norfield Tony "‘Derivatives and Capitalist Markets: The Speculative Heart of Capital’" Historical Materialism 2012 Vol 20 1 103 132 http://dx.doi.org/10.1163/156920612X634735
20. Sengupta Rajdeep , Tam Yu Man "‘The LIBOR-OIS Spread as a Summary Indicator’" Economic Synopses 2008 available at: < >
21. FN1 1. Norfield 2012.
22. FN2 2. For example, McNally 2009, p. 70; Lapavitsas 2006 and 2011; Norfield 2012.
23. FN3 3. Financial Timesn.d.
24. FN4 4. For example, Lapavitsas 2000 and 2005.
25. FN5 5. Ingham 2001 and 2004.
26. FN6 6. The importance of liquidity in conceptualising money is one reason why Hicks preferred to talk of currency rather than money.
27. FN7 7. Merton H. Miller (Miller 1988, p. 109), one of the leading figures of modern conventional finance theory, locates the foundations of the analytical dilemmas of preference shares in the original Black-Scholes option price theory.
28. FN8 8. Bank for International Settlements 2010.
29. FN9 9. See Chen, Filardo, He and Zhu 2011 for a useful current review.
30. FN10 10. See, for example, a view from the Bank of England (Fisher 2010).
31. FN11 11. Board of Governors of the Federal Reserve System 2011.
32. FN12 12. Sengupta and Tam 2008.
33. FN13 13. Norfield 2012, p. 106.
34. FN14 14. Keynes 1971, p. 3.
35. FN15 15. Norfield 2012, p. 113.
36. FN16 16. Ibid.
37. FN17 17. See Callinicos 2012 for a succinct summary.
38. FN18 18. Lapavitsas 2009; see also dos Santos 2009.
39. FN19 19. Fine 2010 challenges the formulation of both Lapavitsas and dos Santos on the grounds that they do not pose the question of whether financial deductions from labour are pre or post a measure of the value of labour-power. It is an important point, but Fine, like Lapavitsas and dos Santos, here situates working-class engagement with finance as a process of exchange, not in accumulation, and so fails to identify how workers are being incorporated as part of (indeed foundations of) financial capital.
Loading

Article metrics loading...

/content/journals/10.1163/1569206x-12341253
2012-01-01
2015-08-29

Affiliations: 1: Department of Political Economy, University of Sydney dick.bryan@sydney.edu.au ; 2: School of Business, University of Sydney michael.rafferty@sydney.edu.au

Sign-in

Can't access your account?
  • Tools

  • Add to Favorites
  • Printable version
  • Email this page
  • Subscribe to email alerts
  • Get permissions
  • Recommend to your library

    You must fill out fields marked with: *

    Librarian details
    Name:*
    Email:*
    Your details
    Name:*
    Email:*
    Department:*
    Why are you recommending this title?
    Select reason:
     
     
     
     
    Other:
     
    Historical Materialism — Recommend this title to your library

    Thank you

    Your recommendation has been sent to your librarian.

  • Export citations
  • Key

  • Full access
  • Open Access
  • Partial/No accessInformation