For the purposes of this post, we can get some idea of Karl Marx’s labor theory of value by looking at the internet for a few sources.

The WikiPedia article Surplus value gives me this excerpt.

According to Marx’s theory, surplus value is equal to the new value created by workers in excess of their own labor-cost, which is appropriated by the capitalist as profit when products are sold.

Karl Marx’s Critique of the Gotha Programme I took this excerpt.

“Starting from these basic principles, the German workers’ party strives by all legal means for the free state—and—socialist society: that abolition of the wage system together with the iron law of wages — and—exploitation in every form; the elimination of all social and political inequality.”

From an English translation of Karl Marx’s book Capital – Chapter Eight: Constant Capital and Variable Capital i took this excerpt.

The labourer adds fresh value to the subject of his labour by expending upon it a given amount of additional labour, no matter what the specific character and utility of that labour may be. On the other hand, the values of the means of production used up in the process are preserved, and present themselves afresh as constituent parts of the value of the product; the values of the cotton and the spindle, for instance, re-appear again in the value of the yarn. The value of the means of production is therefore preserved, by being transferred to the product. This transfer takes place during the conversion of those means into a product, or in other words, during the labour-process. It is brought about by labour; but how?

I take my own understanding of the stock market to shed some light on the fallacy of talking about value as a fixed quantity that can be calculated or even estimated.

In a fair stock market transaction, you have a seller that is willing to sell a stock at a price and a buyer who is willing to buy that stock at that price. There are many reasons why one person is willing to sell the stock and the buyer is willing to buy the stock at an agreed upon price. One reason may be a difference of opinion on what the future holds for that stock. Even if there is no difference of opinion on the future, the buyer and seller have different goals they are trying to achieve. In the case of a younger buyer with a long investment horizon and no need for the cash immediately, the goal may be total return on the investment. For an older, retired investor who wants to use the money from the stock as income, the immediate dividend payments during the retiree’s lifetime may be of more concern than the possible total returns. So the buyers and the sellers can agree on one price that is a good value for buyer to buy the stock, and the other sees that price as a good value to sell the stock.

Both can come away from the transaction completely satisfied with the result of the trade of stock for money. Neither one of them has to feel exploited by the transaction.

Extending this to the wages, the worker can put a value on her or his labor that she or he is selling it for, and the employer can come to an agreement to pay that wage as a good value to buy the labor. Neither one is necessarily being exploited.

None of this says that a buy/sell situation cannot be exploitation of one side or the other, or even both sides. However, calculating a “value” is not independent from whose side of the transaction is doing the calculating. In real life, it is not so easy to figure out what the “value” of anything is. Any system that depends on being able to make such a calculation is not something that can be automated by a robot with no idea of the human part of the equation.

The World Socialist Web Site has the article Jacobin editor Bhaskar Sunkara makes a fool of himself.

While proclaiming his support for the presidential campaign of Bernie Sanders, Sunkara also declares that he will back Elizabeth Warren if she beats out Sanders and Joe Biden if he is eventually the Democratic Party nominee.

Well, that sure puts a damper on my reading Sunkara’s latest book. After I finish the book, I’ll have to come back and contemplate these remarks.

It’s a good thing I didn’t know of this view of Biden by Sankara or I might have foregone reading the book. Maybe, after I finish the book, I will conclude that it was a waste of time. Yet, I did learn a few things that I had not known before even if I completely write off any conclusions he may come to.

RT has the article ETF whale: Bank of Japan (E1391).

In this episode of the Keiser Report, Max and Stacy discuss the fact that the Bank of Japan now owns 73 percent of the country’s ETF market, and how this creates some relative winners at the expense of the growing pile of global “deplorables.” They also discuss the spread of negative rates to mortgage bonds, and how Trump’s Huawei ban may harm rural cellphone users. In the second half, Max interviews Randy Voller, a former Bernie delegate and former head of the Democratic party in North Carolina, about the entry of Joe Biden into the 2020 race for the Democratic nomination.

This is one of those Keiser report episodes where it is hard to figure out where the insights stop and the craziness begins. The insights are in the facts they quote, presuming that those are actual facts. What those facts mean as a prediction of events has the parts that may contain some craziness.

RT has the story Russia-China real gold standard means end of US dollar dominance.

The BRICS are considering an internal gold trading platform, according to Russian officials. When this happens, the global economy will be significantly reshaped, and the West will lose dominance, predicts a precious metal expert.

When I hear predictions like this in the USA oligarchs’ news media from “precious metal experts”, I am always skeptical. I suspect that they are heavily invested in precious metals, and they want to pump up the prices. RT may have different motivations for taking this line.

I post this because I cannot be absolutely sure that none of this will come true. I wonder if this will eventually undermine the policy prescriptions from Modern Money Theory. MMT has the phrase, “The USA government will always have the money to buy whatever is for sale in USA dollars.” They tend to ignore and most MMT devotees tend to ignore what happens when there is very little that is for sale in USA dollars. Such an outcome was hard to imagine until Donald Trump came to office.