Are we heading towards a socialistic/ communist form of governance / economy now? With bailouts we would see governments’ involvement in running varie

In reply to a debate on Linked in, http://www.linkedin.com/answers?viewQuestion=&questionID=407839&askerID=6067402&browseIdx=0&sik=1233147316767&goback=%2Easr_1_1233147316767&report%2Esuccess=vfLh7ZiQxNtkwQoO3efsNN1zAgQ8WXmCT24lKBBmlHq_pfcN7JydQUoVP_zdv4b8

Disagree.The current crisis shouldnot be seen as fall of capitalism. Capitalism idealogically is more than just "GREED".Nothing lasts infinity. Not even greed. That is as far as i understand the current meltdown. There can be no mastery over risk and no escaping the economic/business cycles.Common sense prevailed over bubble optimism with this burst. No mortage was too absurd, no leverage too great, no structured product too reckess when risk spreading models were so brilliantly engineered. Thats a conception which has been blown away. The business cyle is real. There is a very real relation between supply and demand. You cant sustain a market based on lending when the borrowers dont have the resources to pay back the loans. Thats pretty basic. Misadventures against these axiomatic truthisms is what we pay for.AND YET THAT IS NOT THE FALL OF CAPITALISM!In spirit Capitalism is free enterprise. While 1929 saw a meltdown which was as bad or even worse, that didnot end capitalism. Entrepreneurial endeavours and capitalsim made the world the way it is in terms of achievements despite 13 depressions since 1929. As far as, the state control on business is concerned, Keynes or any other economist didnot limit themselves by saying the government cannot limit itself to being a stakeholder in Capitalsit economies. I wholly agree that presently the government is the only crutch failing banks and businesses are holding on to.Well that is the result of slack governance on the part of the state in the corporate sector. It appears that the US economy didnot learn from its Enron and WorldCom and was waiting for Lehmann brothers to happen.From the sweat shop in Burma to the clouds in the web world and heavy machines, i see capitalist endeavour everywhere. The state has played its part by picking up a 1 trillion dollar penalty for not roping in GREED. Thus i again make the point, Capitalism is one thing, Greed is another.

The fall of Capitalism or what?

( In response to a discussion floated in a Linked group...http://www.linkedin.com/groupAnswers)

Hi Srini
Brilliant work on the tabling the facts. But the inferences can perhaps be slightly better 1. The bankruptcy of a few Financial institutions cannot be termed as the fall of capitalism. As long as there are entrepreneurs, Capitalism will be. 2. Agree with you on wasteful expenditures that America has incurred on the trillion dollar "terror" war without much ensuing out of it but the current acount deficit. 3. Nothing substitutes the basics in financial sector. This fall in the banking system is however the fall of over optimism and over leveraging of the mortages and other banking tools without a solid base. 4. My feel is that the financial Tsunami is going to travel eastward to Asia in some direct form or indirect form. Already European banks are feeling the ground under their feet buckle to the pressures. 5. However the more eastward this Tsunami travels the lesser will be its intensity. While it has affected the whole of the American banking system, and part of the European banks, its effect eastwrd will be lesser in scale. 6. For India,liberalisation was a panacea. Ironically however, the gradual rate of oepning up of thefinancial sector has made sure the risks and exposures are not as substantial. 7. It is a good time for economies like India and China to surge ahead. 8. While getting ahead is easier, India will require some discipline to forge the pace. Wasteful rural subsidies must have to stop. Infrastructure must grow faster and we need qulaity out there. 9. For a good 40 years, India was a partly socialistic economy. However at this time, our progress and deliverance lies in judicious capitalism. 10. The Indian capitalist is a thoroughbred and i for one vet for the Indian capitalist to play a significant role in shaping the future of ths country. Which ever way you see it, Srini, we are still talking ideals of capitalism as a means of deliverance whether be India, China or the sinking US. So its not the end of Capitalism, just that it is changing grounds probably...