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Editorial
Credit
crunch threatens global downturn
THE GLOBAL CAPITALIST economy has been hit by a
major credit crunch. The collapse of the sub-prime mortgage business in
the US, brought home by the collapse of two hedge funds managed by Bear
Stearns investment bank, provoked panic on money markets. The effects
have already spread much wider than the housing finance sector. As a
result, there is a paralysis of inter-bank lending and a seizing up of
big sections of the wholesale money market.
This crisis is potentially much more serious than
the Asian currency crisis of 1997 and its aftermath, the collapse of the
Russian rouble and the bankruptcy of the hedge fund, Long Term Capital
Management. At that time, the US and other advanced capitalist countries
were in a relatively strong position and intervened to stabilise the
world economy. The present liquidity crisis originates in the US, the
product of a partial deflation of the housing bubble and other debt
bubbles which developed after 2001. The global financial system is under
threat.
EARLY IN September, the impending insolvency of
Northern Rock provoked a classic bank run, with thousands of depositors
queuing to withdraw their money. The scenes recalled events in Argentina
in 2001, or the last bank run in Britain which occurred in 1886. The
problems of this relatively minor bank threatened to detonate a major
financial crisis, as well as a political crisis for the Brown
government. Moreover, the event highlights the current fragility of
globalised financial markets. LYNN WALSH reports.
Poverty in
the UK
For working-class people, the link between the
policies pursued by a series of governments, Tory and Labour, and rising
poverty and inequality has long been clear. Now two authoritative
reports, reviewed here by HANNAH SELL, starkly reveal the effects of 30
years of neo-liberal onslaught in Britain.
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Today to issue 100 |
US elections
Anti-war activist to run for congress
Turkey's new president
AKP consolidates its position
Chile protests
A new political landscape
The legacy of the Russian revolution
On the ninetieth anniversary of the 1917 Russian revolution we
reprint a defence of October written by Peter Taaffe in 1997
Iran on the brink
Rising workers & threats of war
The fragile superpower
The precarious hold of the Chinese regime
Biofuels propaganda
Responding to religion
Cover cartoon: Suzanne Muna
www.squashdonkey.co.uk
Come to Socialism 2007
 Socialism
2007 is a weekend of discussion and debate hosted by the Socialist
Party, taking place on the 17 and 18 November 2007
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