[Lehman collapse, 15 September 2008 - headlines 16 Sep 2008]

Over the last quarter of a century something fundamental seems to have changed in the way in which capitalism works.

The tendency since 1970 has been towards greater geographical mobility of capital.

Rather than being a modest helper to the capital accumulation process, [finance] gradually turned into a driving force.

Speculative finance became a kind of secondary engine for growth given the weakness in the primary engine, productive investment.

Financialization refers to the increasing importance of financial markets, financial motives, financial institutions and financial elites in the operation of the economy and its governing institutions, both at the national and international levels.

Gerald Epstein (2002) Financialization, Rentier Interests, and Central Bank Policy’

“In the case of the United States, financialization during the 1990s led to a closer alignment of large industrial and financial firms in the U.S., leading to a greater emphasis by Alan Greenspan and the U.S. Federal Reserve in financial asset appreciation as a goal of monetary policy.”

Gerald Epstein (2002) ‘Financialization, Rentier Interests, and Central Bank Policy ‘