On Labor Theory of Value- Well, the first error of reasoning here should be obvious. Assume I work two hours digging a hole in the ground and filling it with crap. You meanwhile worked two hours making a beautiful chair. Which one's worth more? Anyone?
Well, moving on... Marx actually caught on to that little snag, and added the amendment that this went only for socially useful labor. Since it's somewhat difficult to quantify social usefulness, I'm gonna assume this means demand. Ergo, he's assuming that two articles with the same demand will be worth the same given the same labor time. This isn't so bad (though it's steering a little close to the neoclassicist theory of marginal utility -- one that most Marxists reject), but it's still not really up to snuff, because it ignores the importance of capital (as in physical capital) in production. If I make a chair by hand in two days by hand and you carve an identical chair in an hour then the two chairs are obviously worth the same. And even if mine is worth more (it likely is because it's handmade), it'd have to be worth some 20 times more, at least, for it to be worth the same, labor-time-wise, as yours (not likely).
This is a rather important point, because it essentially destroys the Marxist theory of labor exploitation -- which is the central point of Marx's entire economic model. Capital machinery obviously adds value to production (significantly so in fact), and acquisition of capital machinery is made possible by capital investment, which is the contribution of capitalists to production. Ergo, evidently capitalists add value to the production process above and beyond that produced by workers, and thus the value they extract from the production process is not a labor surplus.
Now, if you wanna argue that the value derived by capitalists is excessive, then that's fair but it falls in the realm of generic socialism, rather than Marx's "scientific" socialism. It's somewhat moot, given that nowadays the value derived by senior management far exceeds that derived by capitalists themselves, as do their powers; and senior managers are technically workers.
On the "inevitable" collapse of capitalism- First of all: When? how long does it take for capitalism to collapse? Ten years? A hundred? A thousand? Does it collapse because the sun swallowed the Earth? A prediciton has no predictive power if it just says "it'll happen eventually."
Then there's the actual reasoning behind the impending collapse, as well as the business cycle in general. Supposedly the "contradictions" (read: conflicts) of capitalism become so severe that they bring down the economy. This makes some sense until you realize that Marx was not talking about political conflict: he was talking about the disparity between the value produced by labor, and the actual compensation of labor. Supposedly if the surplus got too extreme then much more would be produced than consumed, causing a general pileup and an economic collapse.
That assumption is laughable on so many levels, that frankly I don't know how it became so popular. Even Keynes spun off on it. First off, this makes the assumption that only workers consume. So, what do capitalists live on, air and unicorn crap? Capitalists, in fact, are bigger demand drivers than workers because they have more money. Not just that, but they're the primary consumers of the most value-adding consumer products on the market: planes, boats, luxury items, and so on.
Second, even if the argument to be made here is that capitalists save, the fact is that savings actually benefit the economy. Savings are, axiomatically, the root of all capital investment, which as I established earlier is a very important factor in production. As for savings that are not invested (hoarding), they simply take money out of circulation, and cause the value of the remaining stock to rise. This causes consumer prices to decline of course, but it also causes producer prices to decline, so itself it won't really cause a general pileup.
Finally, excess inventory isn't really so damn terrible. Marxist thinkers forget that the capitalist economy is highly dynamic, and that kind of adjustment is generally not industry-wide, let alone economy-wide. Excess inventory happens all the time, even in boom periods. That's the reason clearance sales exist (or what the hell did you think the word "clearance" meant, genius?).
I'll post more later, I think poor Karl has received enough of an ass-pounding for now.