71 Cards in this Set
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Forms of money
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currency, deposits, credit
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Uses of money
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1. means of payment and exchange
2. unit of account
3. store of value
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Banks, credit and the creation of money
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Banks hold money/deposits(liabilities) and customers pay interests on deposits(interest). Banks loan money/credit (assets) and charge interest rates, therefore making a profit
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Instability of banking
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Fractional reserves: There is a required percentage of deposits to stay on-hand in banks
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Inflation- causes and losers
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causes: demand and economic expansion, labor costs, profits, raw materials/energy
losers: fixed income people, workers without cost of living adjustments can't keep up with inflating market, lenders(banks), rich people
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Monetary policy
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Central banks not subject to congressional oversight/control. US Federal Reserve control inflation. High interest rates slow down economic activity.
Neoliberal monetary policy(Monetarism): fight inflation and forget full employment; control money supply with interest rates to fight infl…
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Federal Reserve
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1977 Dual Mandate: to control inflation and full employment
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International gold standard(mid 19th c--1930s)
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gold was form of currency. Great Britain was the hegemonic leader. Gold standard collapsed because of the financial crisis(Depression) and distrust of globalization from the depression
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Bretton Woods Regime(1944-1971)
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Concerns about post-war economy. Conference about global monetary system. Money geography- free trade but national policy autonomy. US the hegemonic leader. Strict regulation on finance and global flows of capital. Dollar-gold standard ($35/0z): fixed price
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Post-Bretton Woods Regime(1971-present)
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Money geography- globalization. *Nixon gets rid of money/gold standard.* Financial crisis endemic: 1974-1975; 1987; 1997-1998; 2000; 2001-2002; 2007-2009.
Floating exchange rates. Increased power of financial centers(especially NY)
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Dollar Hegemony?
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US can run massive balance of payment deficits. Wall Street as the center of global finance. Petro-dollars(oil sold in dollars). Challenges to dollar: euro, yen, bitcon
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The dollar and global imbalances
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US and China.
China mass produces cheap goods for US consumption(US dollars go to China).
China holds huge reserves of dollars, used to buy oil and invest in dollar-based investments.
US Treasury borrows dollars from China(T-Bills).
Dollars flow back(as interest payments) to China(fro…
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Forms of corporate finance
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1. Bank loans: give out loans with interest rates
2. corporate bonds: similar to stocks, but has a maturity date and promises a % back to bond owner
3. equities(stocks): ownership in corporations
4. profits: money made after company pays expenses
5. other "investments":
derivatives(…
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Financialization
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Deregulation of financial markets.
Massive growth of financial sector.
Massive shift of whole economy(including productive enterprises) into financial forms of profit-making.
Speculative accumulation.
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Speculative accumulation
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(M-M') To predict based on derivative process/stock markets. Involves financial system: Investments into stock market with assumption it'll increase in value
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Everyday financialization
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Anyone can be an investor.
Debt.
Pensions(retirement plans)
Paygo(government) pay as you go.
Pre-funded(private sector) defined benefit plans, defined contribution plans.
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Student loan debt: education circuit of capital
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Combination of federally subsidized loans and for-profit lenders. Private loans have variable interest rates. No bankruptcy protection. Rising cost of education. University-Loan Agency Coalition
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Gramm-Leach Bliley Bill
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Repealed Glass-Stegal. Broke down compartmentalization. Octupus arms joining together, making it too big to fail. Got rid of separation between banks.
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Commodity futures modernization act
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2000. Deregulated derivatives(contracts for future money--speculative) market
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Securitization food chain
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3/19**
Home buyers- buy homes through mortgage lenders as subprime loans increase--> Mortgage lenders pay investment banks who are involved in: Collaterized debt obligations(CDOs) and Credit Default Swaps
Insurance companies involved in credit default swaps--> CDOs--> Investors; credit …
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Craft Production(3 models of production)
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By hand, or brainwork. Workers have monopoly on skills and maintain some control. Old school and new school.
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Mass Production(3 models of production)
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Fordist, mechanized. Less product differentiation. De-skilled workers. Vertical integration(centralized control).
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High Volume Flexible Production(3 models of production)
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"just in time" production; small batches. Information technology; niche markets. Skilled workers and high tech machinery. Vertical DISintegration(decentralized control)
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Localized clusters
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Transport(near key locations)
Labor(need useful sources of labor)
"knowledge was in the air"
Cultures of trust.
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Time-space compression
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as communications and technology improve, the less time it will take to transport goods/services
example: the internet
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Global production systems
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information technology: Wal-Mart
global supply chains: logistics industry
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Vertical integration
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centralized control
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Vertical Disintegration
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decentralized control. subcontracting and outsourcing. specialization in markets.
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Politics of subcontracting
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Movie: China Blue. Big retailers use subcontractors in poor countries: cheap labor means they can sell product at higher price and make a profit
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Forms of labor struggles
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1. legal- laws for better wages, collective bargaining. safety standards
2. unions- advocate for workers rights
3. strikes
4. geographical coordination
5. upscaling- urban to larger, national labor movements
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Forms of displacement(1980-now)
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-Stagnation and unemployment in the global north. unemployed population rose from 10 to 50 million between 1973 and today.
-Depeasantization in global south. People were forced out of subsistent livelihoods into capital/wage labor life. structural adjustment policies(export based commodi…
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Global wage compression
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Expansion of wage labor supply(rural to urban labor migration). International labor organization estimates a global wage, labor force expanded from 1.9 to 3.1 billion people from 1980-2007
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Informalization of labor
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Precarious labor: no rules or protections, formal contracts, rights or regulations, bargaining power.
Human trafficking.
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Option 1: Internal migration to cities
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many 3rd world megacities. Informal property rights. slums as hazardous landscapes. survival strategies in informal economy-cooperation and entrepenurerialism.
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Option 2: Global migration
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Receiving countries(US). Migrants take jobs that citizens aren't willing to take. Economic insecurity and xenophobia(fear of immigrants). commodification of "care work"(housework, nanny)
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Migration economy
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remittance economies?
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China: new workshop of world?
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China has the 2nd largest economy in world(after US). World's largest exporter and more than just cheap labor
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Urbanization boom
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47% urban due to export oriented industrialization. geographical inequality in the city and country-side
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Commodification of labor
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From "iron rice bowl" to wage labor. 350 million wage workers. Feminization of proletariat.
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Role of migration
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Mass influx of migrant workers due to usually displacement, into cities from countryside
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Hukou system
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In China, a system that ties people to their county of residence, don't have rights if you're in another county, basically an immigrant
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Labor abuses in China
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Non payment of wages
Unpaid overtime
Unfair conditions(6,000 deaths a year in coal mining in early 2000s)
Long hours
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A New Deal for China?
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Workers in China have more power with labor shortages
Wages won.
Viral strikes and riots.
Strategic disruption.
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Challenges for labor activism
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"Rule of Law" and the bureaucratization of labor disputes and individualized resistance.
State monopoly control of trade unions.
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The work of consumption
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Distribution- moving goods from sites of production to sites of consumption
Retail- workers, property developers, lawyers, finance
Product Design- planned obsolescence(companies plan on making products that'll be obsolete in a few years--cars, phones)
Marketing- advertising, market res…
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Different Theories of consumption
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1. consumer sovereignty- consumers are independent choosers, free to control what they buy
2. consumer as dupe- consumers are easily manipulated by corporations
3. culturalist view- both theories together. consumers are part of larger structural idea about culture, class, identity. shap…
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Geographies of retail
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From city centers to suburbs(and back again?)
1800s-1945: city center was site of consumption; Central Business Districts
1945-present: suburban retail(malls, shopping centers)
1980-present: renewed gentrification in urban centers
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Producer-driven commodity chains
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producers have the most power and control over entire commodity chain
ex: automobile industry
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Buyer-driven commodity chains
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Consumers have power as buyers. Manufacturers compete for retail contracts.
Monopsony power?(single buyer)
ex: Wal-Mart
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Consumption identity(conformity or difference? local culture?)
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Consumer identity is geographical(ex: Portland hipsters).
One's home place shapes consumption identities(websites, influences in friends' homes, places)
Globalization and the end of local culture?
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How are cities more than capitalist spaces?
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Cities are public space- a contradiction to capitalism
Cities as neighborhoods and social life- Jane Jacobs
Cities as diversity and immigration
Cities as working class resistance
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Gentrification
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Rooted in British 'gentry' class. Upper-middle class moved into neighborhoods and drove up prices for everything(houses, goods, services). The previous working class residents suffered and were forced to be displaced elsewhere.
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Frontier myth
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Manifest destiny: conquer the beastly Western US. Back to the City Movement. Rationalizes social differentiation and exclusion as natural or inevitable.
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Consumer explanation of gentrification
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People moving into places to buy "high class" commodities.
Buying property, pay high rents.
Raises prices and things become unaffordable to original working class.
Cultural ideologies.
Economics: Market for housing was dictated by who was willing to pay for higher priced houses. Geog…
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Producer explanation of gentrification(rent gap theory)
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Gentrification happens when rent gap(difference between potential rent and actual rent) is so wide that developers can purchase cheap structures.
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Investment in the built environment
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Rent gap theory.
Private property and monopoly control over land and improvements(landlords).
Land and improvements are fixed in space, but value fluctuates(higher prices of rent near a public park).
Built investments are generally long term and require access to credit and financial c…
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Value in property markets
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House value- the amount of labor necessary to produce a house determines its value.
Sale price- what a house will sell for; land it's on affects price(rent+house value)
Capitalist ground rent- when you pay rent, it's payment for the right to use the landlord's land.
Inner city disinves…
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Disinvestment in cities
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New construction and first cycle of use.
Landlordism and home ownership increased= lack of investment in housing.
Blockbusting and blowout- real estate developers go in middle class cities and convinced them to sell their homes; resell houses for higher prices to lower class people.
R…
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Rent Gap Theory
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Gap between potential rent and actual rent(actual rent declines as house value declines; potential rent stays same).
Gentrification happens when gap is so wide(potential rent is MORE than actual rent) that developers can purchase cheap, nice structures and sell them for a higher price th…
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Contradiction #1- markets and nature
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Can market see nature?
Ecological systems- no one pays for protection, consequences in nature
Ozone layer- degrading and thinning from social/human activities; market doesn't care/pay attention to ozone
Environmental externalities
Global carbon cycle- natural through plant life, deca…
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Environmental externalities
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Human/social activities affect the environment indirectly.
ex: factory that leaks waster into water or air doesn't pay for the consequences
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Contradiction #2- growth
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Earth is finite.
Oil production- peak oil in 1970s, yet consumption increases.
Fordism as "suburban solution" that creates a problem; car is good for economies but bad for environment.
Growth and waster- Pacific Garbage Patch
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Contradiction #3-Technology against nature
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Industrialized agriculture- monocoltures; good for capitalism: specialization, economies of scale, mechanization. Turn towards commodified inputs(chemical fertilizers, pesticides, gene seeds) Bad for environment: soil, erosion, pest problems, blight.
Agro-economy- crop rotation; waste is…
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The case against capitalism
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Stark inequality and human deprivation. Market failures and environmental crisis.
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Capitalism and human nature?
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Humans are selfish and greedy. Adam Smith: pursue own interests to better society as a whole. Greed= incentive to work harder
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New vs Old social movements
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Old- movements focused on class, labor, unions. State-based, legal rights were main issues.
New- Women's rights: equality in social aspects(sports, university); Civil Rights(minorities); environmental movements(Earth Day); identities beyond class: feminism, food sovereignty. Carving out …
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Ongoing work of social movements
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social change is an uneven process, so social movements are ongoing work.
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New old social movements
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Fast food US workers fight for better wages. Bangladesh factory workers organize for rights.
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Feminism
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Old movements- political sphere(suffragists); workplace(discrimination and equal pay for equal work; feminization of industrial labor(rosie the riveter); social reproduction(Wages for Housework Campaign, protection of social services like healthcare and education)
New movements- Developm…
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Environmentalism
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Old movements- legal and regulatory regimes. EPA(Nixon); endangered species act, clean air/water acts; mainstream nature protection, national parks and forests.
New movements- environmental justice. environmentalism of the poor. protecting livelihoods, healthy living environments. from l…
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Occupy movement
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focus is on inequality. end of American dream? self-organized social reproduction(hurricane sandy relief). connections to global austerity
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GEO 273: EXAM 2