It couldn't be any clearer than what happened today in the financial markets. The Dow Jones index of large corporate stocks has gained almost 150 points (the other indexes have gained too) on news that the amount of new unemployment claims rose by "only" 4,000 in the preceding week. (The Yahoo! headline and the content of its financial article keep changing, but at some point this morning it read "Markets gain on jobs report," the report being of the sixth straight week of increasing jobless claims.)
The reason for the stock market's rise in the face of this news, which in some reports is indicative of an impending recession, is that in the short run the Federal Reserve may discern that because higher interest may slow "economic growth" it should lower its benchmark interest rate, thereby making common stocks more attractive to investors than debt instruments. In other words, what's bad for the workers is good for the investment class.
Marx/Engels/Trotsky were right. The argued for "permanent revolution" that pitted the proletariat against the petty bourgeoisie, unrelentingly opposing the tug of capitalism toward materialism and greed-based culture. Well, we see now how strong that tug is, with its new proponents in the Far East, in Russia and its former satellites, where CD players outnumber books, stiletto heels abound and Burger King rules.
For the stock market to rise because the labor market plummets? What could be a clearer indicator that Karl Marx was right?
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