Book contents
- Frontmatter
- Contents
- Acknowledgments
- 1 Introduction
- 2 Finance from Britain to the American Colonies
- 3 The Financial Dynamics of Antebellum America
- 4 Contours of American Finance
- 5 Contradictions of Early Twentieth-Century Financial Expansion
- 6 The United States and International Finance in the Interwar Period
- 7 New Foundations for Financial Expansion
- 8 Contradictions of The Dollar
- 9 The Domestic Expansion of American Finance
- 10 Contradictions of Late Twentieth-Century Financial Expansion
- 11 The Neoliberal Consolidation of American Financial Power
- 12 Contradictions of The Present
- Bibliography
- Index
2 - Finance from Britain to the American Colonies
Published online by Cambridge University Press: 07 October 2011
- Frontmatter
- Contents
- Acknowledgments
- 1 Introduction
- 2 Finance from Britain to the American Colonies
- 3 The Financial Dynamics of Antebellum America
- 4 Contours of American Finance
- 5 Contradictions of Early Twentieth-Century Financial Expansion
- 6 The United States and International Finance in the Interwar Period
- 7 New Foundations for Financial Expansion
- 8 Contradictions of The Dollar
- 9 The Domestic Expansion of American Finance
- 10 Contradictions of Late Twentieth-Century Financial Expansion
- 11 The Neoliberal Consolidation of American Financial Power
- 12 Contradictions of The Present
- Bibliography
- Index
Summary
Introduction
One of the key sources of American financial power is that it has developed, through complex and contradictory historical processes, an extraordinary capacity for the creation of liquidity. It is common in IPE scholarship to make a distinction between money liquidity as reflecting real economic value and credit liquidity as created in speculative anticipation of the production of such value. But it is important to appreciate that all forms of liquidity represent relations of credit and debt in the sense that they are only valuable if they can be socially validated as such (Dodd 1994; Ingham 2004). This is the case even for what may appear to be the most “naturally” liquid forms of value like gold: Accepting gold in payment for a good or service is to assume that society is taking on a debt that will be discharged in the future. But of course it is only plausible to claim that all forms of liquid value represent relations of credit and debt if we also reject commonsensical interpretations of the latter as easily created and extended in a financial sphere governed by the wish to escape the allegedly more complex and demanding imperatives of real-world production. Contrary to the commonsense notion that credit is an easy means to provide people with “free lunches,” there is nothing simple or straightforward about its creation. Of course, credit relations are often created without being properly embedded in a wider network of stabilizing relations, leaving them with insufficient support in the foundations of social life and so rendering them unstable and prone to losing value (i.e., suffering inflation); but this is no different from how things work in the more tangible world of manufacturing or, indeed, any other sphere of human action. The successful creation of credit and liquidity is an inherently complex process characterized by a multitude of institutional mediations.
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- The Development of American Finance , pp. 16 - 25Publisher: Cambridge University PressPrint publication year: 2011