Carmen Reinhart and Kenneth Rogoff know financial crises. In the preamble to their book, recommended by FP Big Thinkers Willem Buiter and Mohamed El-Erian, the two trace back the history of how, with each shock and economic trouble, the world believes that this time is different. It's not.
BY CARMEN M. REINHART, KENNETH ROGOFF|DECEMBER 3, 2009
In a chapter of their new book, recommended by FP Big Thinker Paul Collier, George A. Akerlof and Robert Shiller explain why stories -- the human narratives we use to make sense of a complicated world -- are vital to understanding economics.
BY GEORGE A. AKERLOF, ROBERT J. SHILLER|DECEMBER 3, 2009
Going green has finally gone mainstream, and politicians from London to
Seoul are spending billions on clean technologies they say will create
jobs. But unless we are all willing to risk a little more pain, the
green revolution could founder before it ever really starts.
The skylines of unfree societies used to bring to mind images of
endless gray Soviet apartment blocks. But today, some of the world's
most innovative and daring designs are breaking ground in the least
free nations. Why are the world's best architects taking their most
ambitious plans to modern-day autocrats? Two words: Blank slates.
Bill Gates is no longer the world's richest man. That honor now goes to
Mexican billionaire Carlos Slim. But Slim's incredible fortune -- $59
billion and climbing -- is more than a story of one man's rise to riches.
He is one of a growing list of tycoons from countries like China,
India, and Russia who represent a new wave of wealth, power, and
influence. Many are skilled businesspeople. But, in these
fast-developing economies, being able to seize a political opportunity
may count for a lot more.
Free markets were supposed to lead to free societies. Instead, today's
supercharged global economy is eroding the power of the people in
democracies around the globe. Welcome to a world where the bottom line
trumps the common good and government takes a back seat to big
It likes to pretend it is a kinder, gentler alternative to the United
States. But stagnant economies, suffering immigrants, and elitist
rhetoric don't make a global powerhouse. With nothing less than the
future of the European project at stake, the countries of Europe must
now either unite behind much-needed reforms, or watch their differences
tear them apart.
In the corner offices of New York and Tokyo, business leaders cling to
the notion that their designs, technologies, and brands are cutting
edge. Increasingly, however, that just isn't so. In industries ranging
from steel and cement to automobiles and electronics, "Third World
companies" are poised to overtake their Western rivals. Get ready for
the biggest firms you've never heard of to become household names.
Bankruptcies, terrorism, and high oil prices have rocked the airline
industry. Customers complain about bad service and long lines. Are
airlines doomed? Not a chance. The global economy cannot function
without air travel. But the industry that emerges from the coming
shakeout will need a whole new set of wings.
The NBA understands the power of an icon. When Michael Jordan retired
from basketball, the league's ratings began to fall. To bounce back,
the NBA expanded overseas and lured foreign talent to the game. And
there is no one who is as big an ambassador as Yao Ming. The NBA sees
its salvation in the 7-foot, 6-inch Chinese sensation -- and in 1.3
billion hoops fans.