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Home› Part II – Political economy propositions› Chapter 5 - Capital›Proposition 5.10
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5.10 Capital standards are necessary for the permanent consolidation of the market economy.

1. Two advertisements are prescribed above.

One is the capitalization rate The other is exploited value per share.

Their promulgations bring about an organic reform of the capital market, including its stock market compartment.

2. Following a loss-making financial year, the opening capital for the following financial year is de facto reduced.

In the case of an enterprise, it is better to take note of a decrease in the exploited value per share, commensurate with the loss. Conversely, a profitable financial year is likely to increase the exploited value per share.

3. Other capital standards are needed.

They are concerned in particular with ratios of which capital is one of the two terms. We will see later that the most important of these ratios belong to families, the largest of which are three: rate of return, profitability, productivity. By sticking to definitions that are acceptable in the logic of finite sets, a closer look at them gives the observation of what is specific to the practice of commodity exchanges a conceptual precision that is otherwise unattainable.

4. Divergent positions do not prevent agreement on economic reforms.

Many opinions judged liberal or illiberal by those who take them and who oppose them leave a space in which to rebuild by common agreement the best economic organization. Paid Placement_Epargne placements, like paid work, respond to objective needs, recognised as such by a large majority of our fellow citizens. The Objective Political Economy helps to free these necessities from the fears that distract from this progress. The inevitability of markets arranged as they are does not exist.

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