Appendix 3

economic crisis

Economic crisis is a unique manifestation of the market mechanism stage after the misallocation of resources; Its root cause is the imbalance in the distribution of resources, which accumulates in its operation, and the collapse of the mechanism function after reaching a certain level;

In its market mechanism, capital is the driving force that makes it operate, and the essence of capital is an abstract representation of the quantified ownership of resources; Moreover, among the main bodies of the market, the influence of the subjects with high capital share on their market mechanism is greater than that of the subjects with low capital share. Therefore, the subject with a high capital share has a natural superiority in its mechanism; Market entities participate in market activities for the purpose of obtaining their own profits; This kind of profit is measured by the income and expenditure of the individual, rather than the input and output of the system as a whole; Therefore, it is a vague reflection of the value and added value of things, and cannot reflect the real change of value;

Under this mechanism, the subject with a high market share aims to maximize its own interests, so that the amplification degree of the part of the value that it can have in the total value of resources through the operation of the market mechanism is higher than that of the part of the value owned by the subject with a low market share, that is, when the value of things is reflected in the price through the market, the value owned by the subject with a high market share is excessively amplified and the value owned by the subject with a low market share is relatively underestimated, and this trend is continuous; This also shows that the market mechanism is an operation mode with high social costs; The price generated by the market mechanism does not guarantee an effective reflection of the true value of things; Therefore, under this mechanism, the allocation of resources will inevitably be distorted, and it will be exacerbated with its operation, and eventually its resources will be seriously misallocated. The process is as follows:

The manifestation of this process in production is that the total amount of products in the market that market entities are willing to pay in their capital is less than the total amount of capital contained in the products in the market, that is, there is a surplus in the overall number of products in the market, and the market gradually reduces or stops the production of certain products, making it difficult for the capital in its possession to enter the market in the short term, which further weakens the amount of capital of the market entities that are willing to pay, and further stimulates the surplus of products in the market, and finally redistributes its resources through the collapse of prices in the existing mechanism. move on to the next cycle; What should be explained here is that in the process of redistributing resources, the specific situation is different, but its essence is the rebalancing of the proportion of capital, that is, the change of its price to the reflection of the real value of things through the change of the proportion of capital, so that it is within a more reasonable range until the arrival of the next crisis;

The market mechanism does not have a two-way nature in the allocation of resources, and will not spontaneously change the flow of its resource allocation, if its allocation deviates from the actual and reasonable model, the market mechanism itself will only exacerbate the deterioration of this situation, and if it wants to change, it must be adjusted by external forces;

At the production level, it is manifested as:

It must be pointed out here that the equalization of capital and the redistribution of resources based on people's own desires are not necessarily more efficient than the allocation of resources by the market mechanism, and their role is mainly to repair mistakes; The circular description of its entirety can be expressed as:

(The appendix picture can't be sent, and the official account Zhang Xiaoniu can be downloaded if you need it)