SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : THQ,Inc. (THQI)
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Bleeker who wrote (6165)6/19/1998 9:32:00 AM
From: Sigmund  Read Replies (3) of 14266
 
<<<< The reason why REAL yields have come down from the 80s is because there has been a secular downtrend in inflation.<<<<

I certainly agree. But I wonder if there may also be a second reason which is perhaps not totally independent namely that there is relatively a surplus of capital. There is a supply and demand curve for capital like anything else.

With information technology, a lot of what used to be brick and mortar is done with intellectual capital so the relative importance of land, natural resources, labor, and what we normally think of as capital may have changed slightly in favor of labor particularly knowledge workers.

If you recall, our friend SL didn't want to give THQI any credit for anything other than that which shows up on the balance sheet and I am sure SL would discount good will etc.

That is why I am optimistic about the Asian situation. They continue to educate their work force and accumulate experience. A real estate bubble and an old fashioned banking system are difficult hurdles to overcome but their real capital (educated and motivated work force) has not been destroyed.

The Marxists have a concept in what they call crisis theory that capitalism has to destroy capital periodically in order to improve the return on capital so that growth can continue. I studied my economics at the New School for Social Research so I know a lot about Marxist theories.

Marx and Adam Smith came from the same economic school (the Scottish School I think it is called) which was based partly on the labor theory of value. Marx went haywire with it and used it to foment revolution. But Marxists, although totally devoid of any sense when it comes to building an economy, are very good at critiquing and finding the gaps in classical and neoclassical economics. Their crisis theory is an example of where they are on to something.

So perhaps there is too much real estate capital in Asia and once some of it is destroyed they can resume their growth. We went through this stage starting in the late eighties prior to real estate recently again coming back in favor in this country. But it didn't make the entire economy tank. Just those of us with limited partnerships in real estate felt the pain.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2026 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News