It should be quite obvious by now that lax frames for the virtual casino economy can have severe ramifications for the productive and reproductive economy. Likewise the virtual economy busts when its “objective” groundings weakens … or appear to weaken. Short term fluctuations in the virtual economy may be less affected by the productive and reproductive economy than by social psychological factors like speculative rumors and flock mentality leading to market reactions, analysts say.

The day after the $ 700 billion bail out package was passed by the US Congress the NY stock exchange surged — speculators felt reassured that the they would continue to reap the benefits of their risky speculation while the state would continue to the carry the risks. Now the British shadow chancellor, Osbourne, has accused Brown for “fiscal irresponsibility”, because of his proposed stimulation package (which includes lower taxes for the poor and public investments in green infra and seems to be more long-term oriented than just simply bailing out the big fish) on the G20 summit. He predicts a “run on the pound” as a result of it. Now critiques predict a “run on the pound” as a result of Osbourne’s prediction of a “run on the pound”. Osbourne defends his prediction but Tory leader have defended him.

“My job as shadow chancellor is to tell the British people the truth about the British economy. The truth that it is the worst prepared economy in the world for recession.”

He may sound confident but he will not sleep tight tonight, and if his prediction is fulfilled next week, he knows his head will roll.

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