Shares crashing as oil nears $100 a barrel

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THE US dollar is reeling against the euro.

The US sub-mortgage crisis is deepening, with housing starts down by 10 per cent in September, while profit forecasts for big business are being slashed back.

Last Friday night, Wall Street took fright, despite its record-breaking expansion of share prices in recent weeks, collapsing by 367 points.

Meanwhile, oil prices are galloping upwards with the price of $100 a barrel beckoning, while the news from the Middle East for capitalism goes from bad to worse to absolutely awful.

Sixteen more Turkish troops have been killed along the Iraqi border with Turkey by PKK (Kurdish Workers Party) fighters, and it may only be a matter of hours before thousands of Turkish troops invade northern Iraq and move towards the Kirkuk and Mosul oilfields.

Such an action already has the support of President Assad of Syria and is certain to sharpen the political and economic contradictions of capitalism.

US imperialist policy in Iraq is now in shreds. The situation is indeed a ‘nightmare without end’, with Europe, Japan and the US facing a major share crash today, just 20 years after Black Monday 1987.

However, the difference between that collapse and this is qualitative.

The dollar has already sunk to record levels against the euro and the pound, the US housing market has collapsed and with it a section of the banks. The US government is in record deficit, while US industrial giants are threatening to quit the USA, as the prospect of war and revolution throughout the Middle East threatens to cut off the US from its major source of oil.

British imperialism finds itself at this juncture just a shadow of what it was in 1987.

Now it is a mainly service economy dominated by the needs and the crisis of the financial parasites of the City of London, who are already deep into a debt crisis, in a country that is already technically bankrupt, with a record balance of trade crisis, and with its domestic debt bigger than its gross domestic product.

The IMF has already predicted that the British sub-mortgage crisis will be more intense than even that of the USA.

What is emerging is not just a repetition of the 1987 collapse, but a deeper, more explosive crisis with the sharpening contradictions driving forward slump, financial collapses, wars and revolutions.

The chronic indebtedness of Britain makes it rotten-ripe for a financial crash of the banks and the housing market, and a run on the grossly overpriced pound sterling.

This developing crisis must be the signal for the mobilisation of the working class and the bulk of the middle class.

What both sections can be sure of is that however grave the crisis becomes, the vast bulk of it will be placed onto their backs by Brown as he seeks to move to a national government with Tories and Liberals.

In this situation, the working class needs a new and revolutionary leadership to replace the hopeless reformist trade union leaders who have shown in the Royal Mail struggle that they are incapable of fighting for their members.

A leadership is needed that will fight against all job cuts, wage cuts and pension cuts, that will occupy factories to halt their closure and will expropriate the bosses and bankers rather than put up with mass sackings and the repossession of millions of homes.

The only answer to this developing crisis of capitalism is a socialist revolution. This requires the rapid building up of the Workers Revolutionary Party to resolve the crisis of leadership in the working class.