Edemilson Paraná offers the reader a rich overview of the impact of financial globalization. In the current Age of Neoliberalism, finance controls the intertemporal allocation of resources (the relations between consumption and investment), its sectorial allocation (the composition of output, investment, labor and consumption) and international distribution (the pattern of specialization between countries). Digital finance is the outcome of the convergence of new technologies and the expansion of financial logic: the quest for tiny gains in millions of transactions performed in milliseconds, often reversed almost immediately, without any real effects except the enrichment of a few.
Digitalized Finance lies at the intersection of economics, politics and society: by seeking instantaneous speculative gains, finance declares its support for, or rejection, of political decisions in real time whilst, also, establishing the limits of social wellbeing at every moment. Social and political activity can no longer exist separately from finance and its effects; nor can they ignore the shifts in economic and ideological structures dominated by finance.
Financialization has also fostered a generalized rise in rates of exploration. This book shows in detail how these processes take place, and how the application of the most advanced information and communication technologies have supported the rise of new ways of exploiting people, poor countries and nature, including a detailed and unique analysis of the restructuring of the relations of control and domination in Brazil. This book is essential reading for anyone wishing to understand the distinguishing features of contemporary financialized capitalism.
Alfredo Saad-Filho
SOAS University of London
The relationship between technological progress and capitalist development is symbiotic. The paradigmatic example of this mutualism is the industrial revolution in the mid-18th century. Ushered in by the advance of the very capitalist relations that it started, it ultimately determined the victory of this means of social organization over all others. Within this same social shift, it forged a kind of technological advance that, if it does indeed contribute so greatly to the destruction of the material barriers holding back the development of the human spirit, then it does so with the parameters found in the logic and the imperatives of the accumulation of capital. But just as the commodity – the
The constant celebration of technological virtuosity is therefore explained as though it were independent, neutral and linear, responding solely to man’s incredible capacity to create. This is not the case, however, with the book you have in your hands. Fully aware of all the issues that are involved here, and following this methodological principle to the letter, Edemilson Paraná has provided an astute and solid analysis of the role of Information and Communication Technologies (ICT) in the intensification and strengthening of the financialization process of the global economy.
Exploring what he calls the “Cycle of Operation of Digitalized Finance”, Paraná introduces us to the unbelievable world of the creation of abstract wealth, bolstered by sophisticated mathematical models, automated robots and trading software that seeks unimaginable revenues in a matter of milliseconds. Enormous investments, in the region of hundreds of millions of dollars, are made by companies looking to gain two or three milliseconds in the period between a trading order being made and its actual application (to get some idea of what this means, the blink of an eye takes around 400 milliseconds).
Faced with such an incredible scenario, the author only manages to resist the fetishistic temptation of seeing financialization as the result of the development of the ICT by staying true to his firm methodological discipline. The result of his analysis is, therefore, formidable: he demonstrates that, just as the machinery of the industrial revolution made the already formally existent subordination of labor to capital a reality, the untiring development of the ICT over the past few decades, by firmly establishing the compression of the space-time that is the nature of capital, has meant the increasing and very real subordination of the logic of productive accumulation to the logic of financial accumulation (that the crisis of the 1970s had already set in motion). This is, therefore, a book that is essential for anyone wishing to understand contemporary capitalism.
Leda Paulani
University of São Paulo (USP)