The Great Debate UK

from MacroScope:

Step aside capitalism, how about leverageism

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Our recent post on the End of Capitalism triggered much interest and comment.  There were plenty of diverse views, as one would expect. But one thread that came out was that what we are now seeing is not true capitalism (nor, of course, is it old-style communism). Ok, but what is it?

Anthony Conforti suggested in a comment that we need a name for what is happening,:

The first step in defining a new economic paradigm is coming up with the proper terms…new words to define a new economic environment. As words, “capitalism”, “communism”, “socialism” may now be inadequate to describe the emerging economic reality. We need new nomenclature. Any thoughts?

Here's one suggestion. There seems to have been precious little capital building going on is the last few years, so even in a free market, capitalism sounds a bit inaccurate. How about "leverageism"? Borrowers of the world, unite. You have nothing  to lose but your shirts.

from Commentaries:

Take the L out of LBO

In a perfect world, we would simply ban leveraged buyouts. The vast majority of these debt-laden corporate takeovers are no less predatory and value-destroying to a company than a loan shark who charges usurious rates of interest.

Realistically, a prohibition on private equity deals will never happen, given the big dollars involved in these transactions and the sizeable campaign contributions that private equity chieftains shower on politicians from both parties.

from For the Record:

Watching our language: Writing about the financial crisis

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dean-150Dean Wright is Global Editor, Ethics, Innovation and News Standards. Any opinions are his own.

The global financial crisis may have drained the coffers of investors, businesses and nations, but it’s making our language a bit richer as we discover, revive, coin and develop words and phrases to help make sense of it all.

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