Kenneth Rogoff

140 results back to index

House of Debt: How They (And You) Caused the Great Recession, and How We Can Prevent It From Happening Again by Atif Mian, Amir Sufi

Andrei Shleifer, asset-backed security, balance sheet recession, bank run, banking crisis, behavioural economics, Ben Bernanke: helicopter money, break the buck, business cycle, Carmen Reinhart, collapse of Lehman Brothers, creative destruction, debt deflation, Edward Glaeser, en.wikipedia.org, financial innovation, full employment, high net worth, Home mortgage interest deduction, housing crisis, Joseph Schumpeter, Kenneth Rogoff, Kickstarter, liquidity trap, Long Term Capital Management, low interest rates, market bubble, Martin Wolf, money market fund, moral hazard, mortgage debt, negative equity, paradox of thrift, quantitative easing, Robert Shiller, Robert Solow, school choice, seminal paper, shareholder value, subprime mortgage crisis, the payments system, the scientific method, tulip mania, young professional, zero-sum game

International Monetary Fund, “Chapter 3: Dealing with Household Debt,” in World Economic Outlook: Growth Resuming, Dangers Remain, April 2012. 16. Mervyn King, “Debt Deflation: Theory and Evidence,” European Economic Review 38 (1994): 419–45. 17. Carmen Reinhart and Kenneth Rogoff, “Is the 2007 US Sub-Prime Financial Crisis So Different?: An International Historical Comparison,” American Economic Review 98 (2008): 339–44. 18. Carmen Reinhart and Kenneth Rogoff, This Time Is Different (Princeton, NJ: Princeton University Press, 2009). 19. Oscar Jorda, Moritz Schularick, and Alan M. Taylor, “When Credit Bites Back: Leverage, Business Cycles, and Crisis” (working paper no. 17621, NBER, 2011). 20.

…

He has been a strong advocate for financial contracts that more equally share risk in the context of household and sovereign debt. See, for example, Stefano Athanasoulis, Robert Shiller, and Eric van Wincoop, “Macro Markets and Financial Security,” FRBNY Economic Policy Review, April 2009. Kenneth Rogoff has also advocated more equity-like instruments in the context of sovereign debt. See Kenneth Rogoff, “Global Imbalances without Tears,” Project Syndicate, March 1, 2011, http://www.project-syndicate.org/commentary/global-imbalances-without-tears. Lord Adair Turner has summarized excellently the problems with debt and advantages of equity finance.

…

Despite focusing on a completely different recession, King found exactly the same relation: Countries with the largest increase in household-debt burdens—Sweden and the United Kingdom, in particular—experienced the largest decline in growth during the recession. Another set of economic downturns we can examine are what economists Carmen Reinhart and Kenneth Rogoff call the “big five” postwar banking crises in the developed world: Spain in 1977, Norway in 1987, Finland and Sweden in 1991, and Japan in 1992.17 These recessions were triggered by asset-price collapses that led to massive losses in the banking sector, and all were especially deep downturns with slow recoveries.

The Shifts and the Shocks: What We've Learned--And Have Still to Learn--From the Financial Crisis by Martin Wolf

air freight, Alan Greenspan, anti-communist, Asian financial crisis, asset allocation, asset-backed security, balance sheet recession, bank run, banking crisis, banks create money, Basel III, Bear Stearns, Ben Bernanke: helicopter money, Berlin Wall, Black Swan, bonus culture, break the buck, Bretton Woods, business cycle, call centre, capital asset pricing model, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, central bank independence, collateralized debt obligation, corporate governance, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, currency peg, currency risk, debt deflation, deglobalization, Deng Xiaoping, diversification, double entry bookkeeping, en.wikipedia.org, Erik Brynjolfsson, Eugene Fama: efficient market hypothesis, eurozone crisis, Fall of the Berlin Wall, fiat currency, financial deregulation, financial innovation, financial repression, floating exchange rates, foreign exchange controls, forward guidance, Fractional reserve banking, full employment, Glass-Steagall Act, global rebalancing, global reserve currency, Growth in a Time of Debt, Hyman Minsky, income inequality, inflation targeting, information asymmetry, invisible hand, Joseph Schumpeter, Kenneth Rogoff, labour market flexibility, labour mobility, Les Trente Glorieuses, light touch regulation, liquidationism / Banker’s doctrine / the Treasury view, liquidity trap, Long Term Capital Management, low interest rates, mandatory minimum, margin call, market bubble, market clearing, market fragmentation, Martin Wolf, Mexican peso crisis / tequila crisis, Minsky moment, Modern Monetary Theory, Money creation, money market fund, moral hazard, mortgage debt, negative equity, new economy, North Sea oil, Northern Rock, open economy, paradox of thrift, Paul Samuelson, price stability, private sector deleveraging, proprietary trading, purchasing power parity, pushing on a string, quantitative easing, Real Time Gross Settlement, regulatory arbitrage, reserve currency, Richard Feynman, risk-adjusted returns, risk/return, road to serfdom, Robert Gordon, Robert Shiller, Ronald Reagan, savings glut, Second Machine Age, secular stagnation, shareholder value, short selling, sovereign wealth fund, special drawing rights, subprime mortgage crisis, tail risk, The Chicago School, The Great Moderation, The Market for Lemons, the market place, The Myth of the Rational Market, the payments system, The Wealth of Nations by Adam Smith, too big to fail, Tyler Cowen, Tyler Cowen: Great Stagnation, vertical integration, very high income, winner-take-all economy, zero-sum game

‘A Step in the Dark: Unconventional Monetary Policy after the Crisis’, Andrew Crockett Memorial Lecture, Bank for International Settlement, 23 June 2013. http://www.bis.org/events/agm2013/sp130623.pdf. Reinhart, Carmen M. and Kenneth S. Rogoff. This Time is Different: Eight Centuries of Financial Folly (Princeton and Oxford: Princeton University Press, 2009). Reinhart, Carmen M. and Kenneth S. Rogoff. ‘Growth in a Time of Debt’, National Bureau of Economic Research Working Paper No. 15639, January 2010. www.nber.org. Report of the Parliamentary Commission on Banking Standards. Changing Banking for Good: Volume 1.

…

In all, the legacy of the crises includes deep practical challenges to policymaking almost everywhere. As a result of these unexpected economic developments, crisis-hit countries have been forced to struggle with worse fiscal positions than they had previously imagined. As the work of Carmen Reinhart and Kenneth Rogoff, both now at Harvard University, has shown, fiscal crises are a natural concomitant of financial crises, largely because of the impact on government revenue and spending of declining profits and economic activity, together with rising unemployment. These come on top of the direct fiscal costs of bank bailouts.7 As was to be predicted, in the current crisis the biggest adverse fiscal effects were felt in countries that suffered a direct hit from the financial crises, such as the US, the UK, Ireland and Spain, rather than in countries that suffered an indirect hit, via trade.

…

In fact, it was a pity that a form of ‘sticker shock’ over the scale of the unexpected deficits frightened policymakers into not giving the discretionary fiscal support then needed and, subsequently, as we shall see further below, into premature retrenchment. Nobody should be surprised by the huge fiscal deterioration that followed the crisis. In their seminal book, This Time is Different, Carmen Reinhart and Kenneth Rogoff argue that: ‘Declining revenues and higher expenditures, owing to a combination of bailout costs and higher transfer payments and debt service costs, led to a rapid and marked worsening in the fiscal balance.’48 In fact, they note from an analysis of crises in thirteen countries, the cumulative increase in real public debt was 86 per cent – close to a doubling.49 What happened after 2007 is in line with that prior experience.

Paper Promises by Philip Coggan

accounting loophole / creative accounting, activist fund / activist shareholder / activist investor, Alan Greenspan, balance sheet recession, bank run, banking crisis, barriers to entry, Bear Stearns, Berlin Wall, Bernie Madoff, Black Monday: stock market crash in 1987, Black Swan, bond market vigilante , Bretton Woods, British Empire, business cycle, call centre, capital controls, Carmen Reinhart, carried interest, Celtic Tiger, central bank independence, collapse of Lehman Brothers, collateralized debt obligation, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, currency peg, currency risk, debt deflation, delayed gratification, diversified portfolio, eurozone crisis, Fall of the Berlin Wall, falling living standards, fear of failure, financial innovation, financial repression, fixed income, floating exchange rates, full employment, German hyperinflation, global reserve currency, Goodhart's law, Greenspan put, hiring and firing, Hyman Minsky, income inequality, inflation targeting, Isaac Newton, John Meriwether, joint-stock company, junk bonds, Kenneth Rogoff, Kickstarter, labour market flexibility, Les Trente Glorieuses, light touch regulation, Long Term Capital Management, low interest rates, manufacturing employment, market bubble, market clearing, Martin Wolf, Minsky moment, Money creation, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, mortgage debt, Myron Scholes, negative equity, Nick Leeson, Northern Rock, oil shale / tar sands, paradox of thrift, peak oil, pension reform, plutocrats, Ponzi scheme, price stability, principal–agent problem, purchasing power parity, quantitative easing, QWERTY keyboard, railway mania, regulatory arbitrage, reserve currency, Robert Gordon, Robert Shiller, Ronald Reagan, savings glut, short selling, South Sea Bubble, sovereign wealth fund, special drawing rights, Suez crisis 1956, The Chicago School, The Great Moderation, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, The Wealth of Nations by Adam Smith, time value of money, too big to fail, trade route, tulip mania, value at risk, Washington Consensus, women in the workforce, zero-sum game

Britain has not formally defaulted since 1672, although this record does not apply to its European neighbours. In the nineteenth century, for example, the Austro-Hungarian Empire defaulted or rescheduled its debt five times. In their magisterial study of the subject, This Time Is Different,15 Carmen Reinhart and Kenneth Rogoff describe a cycle of sovereign defaults, with peaks in the Napoleonic Wars, the 1820s through to the 1840s, the 1870s to the 1890s and the Great Depression of the 1930s. Clearly, wars often played their part in this cycle, with defeated nations highly likely to renege on their debts. But economic and banking crises, often associated with the rise and fall of commodity prices, also played a big part.

…

As Jeremy Grantham of the fund management company GMO has written, ‘Individuals, as well as institutions, were fooled into believing that the market signals were real, that they truly were rich. They acted accordingly, spending too much or saving too little, all the while receiving less than usual from their overpriced holdings.’1 It is not just investors who are fooled. Policymakers can be too. As Carmen Reinhart and Kenneth Rogoff put it, ‘Debt-fuelled booms all too often provide false affirmation of a government’s policies, a financial institution’s ability to make outsized profits or a country’s standard of living. Most of these booms end badly.’2 FORTY YEARS OF BUBBLES The last forty years of economic history (since the collapse of Bretton Woods) have been remarkable.

…

Good debtors, like Britain and the Netherlands, had financial advantages over bad debtors, like eighteenth-century France. Britain’s financial success encouraged other countries to follow its example. But the willingness of countries to follow prudent financial policies proved no more permanent than the willingness of most January revellers to follow their New Year’s resolutions. Carmen Reinhart and Kenneth Rogoff recount that sovereign default has occurred in a number of waves, starting with the Napoleonic Wars.1 In the 1840s cycle, nearly half the countries in the developed world were in default. There was a 1870s to 1890s wave, associated with falling commodity prices, and a 1930s to 1950s phase, linked to the Great Depression and the war.

Crisis Economics: A Crash Course in the Future of Finance by Nouriel Roubini, Stephen Mihm

Alan Greenspan, Asian financial crisis, asset-backed security, balance sheet recession, bank run, banking crisis, barriers to entry, Bear Stearns, behavioural economics, Berlin Wall, Bernie Madoff, Big bang: deregulation of the City of London, Black Swan, bond market vigilante , bonus culture, Bretton Woods, BRICs, British Empire, business cycle, call centre, capital controls, Carmen Reinhart, central bank independence, centralized clearinghouse, collapse of Lehman Brothers, collateralized debt obligation, corporate governance, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency risk, dark matter, David Ricardo: comparative advantage, debt deflation, Eugene Fama: efficient market hypothesis, Fall of the Berlin Wall, fiat currency, financial deregulation, financial engineering, financial innovation, Financial Instability Hypothesis, financial intermediation, full employment, George Akerlof, Glass-Steagall Act, global pandemic, global reserve currency, Gordon Gekko, Greenspan put, Growth in a Time of Debt, housing crisis, Hyman Minsky, information asymmetry, interest rate swap, invisible hand, Joseph Schumpeter, junk bonds, Kenneth Rogoff, laissez-faire capitalism, liquidity trap, London Interbank Offered Rate, Long Term Capital Management, Louis Bachelier, low interest rates, margin call, market bubble, market fundamentalism, Martin Wolf, means of production, Minsky moment, money market fund, moral hazard, mortgage debt, mortgage tax deduction, new economy, Northern Rock, offshore financial centre, oil shock, Paradox of Choice, paradox of thrift, Paul Samuelson, Ponzi scheme, price stability, principal–agent problem, private sector deleveraging, proprietary trading, pushing on a string, quantitative easing, quantitative trading / quantitative finance, race to the bottom, random walk, regulatory arbitrage, reserve currency, risk tolerance, Robert Shiller, Satyajit Das, Savings and loan crisis, savings glut, short selling, South Sea Bubble, sovereign wealth fund, special drawing rights, subprime mortgage crisis, Suez crisis 1956, The Great Moderation, The Myth of the Rational Market, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, too big to fail, tulip mania, Tyler Cowen, unorthodox policies, value at risk, We are all Keynesians now, Works Progress Administration, yield curve, Yom Kippur War

., August 27, 2005. 3 “the greatest of all credit bubbles”: Justin Lahart, “NASDAQ: Five Years after the Peak,” Wall Street Journal, March 7, 2005. 3 William White: Beat Balzli and Michaela Schiessl, “The Man Nobody Wanted to Hear,” Der Spiegel, July 8, 2009. 3 Maurice Obstfeld and Kenneth Rogoff: Maurice Obstfeld and Kenneth Rogoff, “The Unsustainable US Current Account Position Revisited,” National Bureau of Economic Research Working Paper no. 10869, November 2004. 3 Stephen Roach: Brett Arends, “Economic ‘Armageddon’ Predicted,” Boston Herald, November 23, 2004. 5 “animal spirits”: John Maynard Keynes, The General Theory of Employment, Interest, and Money (New York: Harcourt, Brace, and World, 1936), 161. 5 “the ideas of economists . . .”: Ibid., 383. 11 “The decadent international . . .”: John Maynard Keynes, “National Self-Sufficiency,” Yale Review 22 (1933): 760-61.

…

Other well-respected figures raised a similar warning: Wall Street legend James Grant warned in 2005 that the Federal Reserve had helped create one of “the greatest of all credit bubbles” in the history of finance; William White, chief economist at the Bank for International Settlements, warned about the systemic risks of asset and credit bubbles; financial analyst Nassim Nicholas Taleb cautioned that financial markets were woefully unprepared to handle “fat tail” events that fell outside the usual distribution of risk; economists Maurice Obstfeld and Kenneth Rogoff warned about the unsustainability of current account deficits in the United States; and Stephen Roach of Morgan Stanley and David Rosenberg of Merrill Lynch long ago raised concerns about consumers in the United States living far beyond their means. The list goes on. But for all their respectability, these and other economists and commentators were ignored, a fact that speaks volumes about the state of economics and finance over recent decades.

…

Keynes is here, as is his most radical interpreter, Hyman Minsky, but so are economists from other camps: Robert Shiller, one of the most visible proponents of behavioral economics; Joseph Schumpeter, the grand theorist of capitalist “creative destruction”; and economists of a historical bent, from Charles Kindleberger to Carmen Reinhart and Kenneth Rogoff. Their disparate strands of thought inform our idiosyncratic approach to understanding crises. When Markets Behave Badly Crisis economics is the study of how and why markets fail. Much of mainstream economics, by contrast, is obsessed with showing how and why markets work—and work well.

The Curse of Cash by Kenneth S Rogoff

Alan Greenspan, Andrei Shleifer, Asian financial crisis, bank run, Ben Bernanke: helicopter money, Berlin Wall, bitcoin, blockchain, Boris Johnson, Bretton Woods, business cycle, capital controls, Carmen Reinhart, cashless society, central bank independence, cryptocurrency, debt deflation, disruptive innovation, distributed ledger, Dr. Strangelove, Edward Snowden, Ethereum, ethereum blockchain, eurozone crisis, Fall of the Berlin Wall, fiat currency, financial exclusion, financial intermediation, financial repression, forward guidance, frictionless, full employment, George Akerlof, German hyperinflation, government statistician, illegal immigration, inflation targeting, informal economy, interest rate swap, Isaac Newton, Johann Wolfgang von Goethe, Johannes Kepler, Kenneth Rogoff, labor-force participation, large denomination, liquidity trap, low interest rates, Modern Monetary Theory, Money creation, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, moveable type in China, New Economic Geography, offshore financial centre, oil shock, open economy, payday loans, price stability, purchasing power parity, quantitative easing, RAND corporation, RFID, savings glut, secular stagnation, seigniorage, The Great Moderation, the payments system, The Rise and Fall of American Growth, transaction costs, unbanked and underbanked, unconventional monetary instruments, underbanked, unorthodox policies, Y2K, yield curve

THE CURSE OF CASH THE CURSE OF CASH KENNETH S. ROGOFF PRINCETON UNIVERSITY PRESS PRINCETON AND OXFORD Copyright © 2016 by Kenneth S. Rogoff Requests for permission to reproduce material from this work should be sent to Permissions, Princeton University Press Published by Princeton University Press, 41 William Street, Princeton, New Jersey 08540 In the United Kingdom: Princeton University Press, 6 Oxford Street, Woodstock, Oxfordshire OX20 1TR press.princeton.edu Jacket design by Faceout Studio Excerpt from The Collected Writings of John Maynard Keynes copyright © 1931, 1972, 2010, 2013 The Royal Economic Society.

…

Washington, DC. Reifschneider, David L., and John C. Williams. 2000. “Three Lessons for Monetary Policy in a Low-Inflation Era.” Journal of Money, Credit and Banking 32 (4): 936–66. Reinhart, Carmen M., Vincent Reinhart, and Kenneth S. Rogoff. 2015. “Dealing with Debt.” Journal of International Economics 96, suppl. 1 (July): S43–S55. Reinhart, Carmen M., and Kenneth S. Rogoff. 2002. “The Modern History of Exchange Rate Arrangements: A Reinterpretation.” NBER Working Paper 8963 (June). Cambridge, MA: National Bureau of Economic Research. ———. 2004. “The Modern History of Exchange Rate Arrangements: A Reinterpretation.”

…

Rogoff Requests for permission to reproduce material from this work should be sent to Permissions, Princeton University Press Published by Princeton University Press, 41 William Street, Princeton, New Jersey 08540 In the United Kingdom: Princeton University Press, 6 Oxford Street, Woodstock, Oxfordshire OX20 1TR press.princeton.edu Jacket design by Faceout Studio Excerpt from The Collected Writings of John Maynard Keynes copyright © 1931, 1972, 2010, 2013 The Royal Economic Society. Reprinted with the permission of Cambridge University Press. All Rights Reserved Library of Congress Cataloging-in-Publication Data Names: Rogoff, Kenneth S., author. Title: The curse of cash / Kenneth S. Rogoff. Description: Princeton : Princeton University Press, [2016] | Includes bibliographical references and index. Identifiers: LCCN 2016014943 | ISBN 9780691172132 (hardback : alk. paper) Subjects: LCSH: Paper money. | Money. | Currency question. | Monetary policy. Classification: LCC HG350 .R64 2016 | DDC 332.4—dc23 LC record available at https://lccn.loc.gov/2016014943 British Library Cataloging-in-Publication Data is available This book has been composed in Sabon LT Std with DIN Pro Display Printed on acid-free paper. ∞ Printed in the United States of America 10987654321 To my parents, June and Stanley Rogoff CONTENTS Preface ix Chapter 1: Introduction and Overview 1 PART I: The Dark Side of Paper Currency: Tax and Regulatory Evasion, Crime, and Security Issues Chapter 2: The Early Development of Coins and Paper Currency 15 Chapter 3: Size and Composition of Global Currency Supplies, and the Share Held Abroad 31 Chapter 4: Holdings of Currency in the Domestic, Legal, Tax-Paying Economy 48 Chapter 5: Currency Demand in the Underground Economy 58 Chapter 6: Seigniorage 80 Chapter 7: A Plan for Phasing Out Most Paper Currency 92 PART II: Negative Interest Rates Chapter 8: The Cost of the Zero Bound Constraint 119 Chapter 9: Higher Inflation Targets, Nominal GDP, Escape Clauses, and Fiscal Policy 147 Chapter 10: Other Paths to Negative Interest Rates 158 Chapter 11: Other Possible Downsides to Negative Nominal Policy Rates 175 Chapter 12: Negative Interest Rates as a Violation of Trust and a Step Away from Rule-Based Systems 182 PART III: International Dimensions and Digital Currencies Chapter 13: International Dimensions to Phasing Out Paper Currency 199 Chapter 14: Digital Currencies and Gold 208 Final Thoughts 217 Acknowledgments 221 Appendix 225 Notes 233 References 257 Index 273 PREFACE This book deals with an issue that might seem stupefyingly mundane, more of a minor irritant than a curse.

China's Superbank by Henry Sanderson, Michael Forsythe

"World Economic Forum" Davos, addicted to oil, Asian financial crisis, Bretton Woods, BRICs, Carmen Reinhart, Credit Default Swap, deindustrialization, Deng Xiaoping, Dutch auction, failed state, financial innovation, financial repression, fixed income, Great Leap Forward, high-speed rail, if you build it, they will come, income inequality, invisible hand, joint-stock company, junk bonds, Kenneth Rogoff, land bank, London Interbank Offered Rate, low interest rates, megacity, new economy, New Urbanism, price mechanism, race to the bottom, reserve currency, Ronald Reagan, Shenzhen special economic zone , Shenzhen was a fishing village, Silicon Valley, Solyndra, South Sea Bubble, sovereign wealth fund, special drawing rights, special economic zone, too big to fail, urban renewal, urban sprawl, work culture

In China, the rate depositors receive is often below inflation, and the lending rate has been kept below producer prices, meaning that bond market rates have also been kept artificially low. This is a classic example of “financial repression,” as economists describe it.72 As Carmen Reinhart and Kenneth Rogoff put it in their book on financial crises: “Under financial repression, banks are vehicles that allow governments to squeeze more indirect tax revenue from citizens by monopolizing the entire savings and payments system, not simply currency. Governments force local residents to save in banks by giving them few, if any, other options.

…

“Missing Funds Spark Probe of Bank Vice President,” Economic Observer, June 27, 2008, http://www.eeo.com.cn/ens/2008/0627/104454.shtml 71. Gao Jian, Debt Capital Markets in China (Hoboken, NJ: John Wiley & Sons, 2007). 72. Nicholas Lardy, “Financial Repression in China,” Policy Brief 08-8, Peterson Institute for International Economics (September 2008). 73. Carmen Reinhart and Kenneth Rogoff, This Time Is Different: Eight Centuries of Financial Folly (Princeton, NJ: Princeton University Press, 2009). 74. CDB 2010 Annual Report. Available on their Web site at www.cdb.com.cn 75. Dealbook, “With Barclays, China Continues Overseas March,” July 24, 2007, www.cdb.com.cn/english/NewsInfo.asp?

…

In the 1980s, debt in sub-Saharan Africa doubled, and real per-capita incomes were lower at the end of the period than at the beginning.43 Table 3.3 Africa’s Debt History Country Years of Default and Rescheduling Algeria 1991 Angola 1985 Central African Republic 1981, 1983 Côte d’Ivoire 1983, 2000 Egypt 1984 Kenya 1994, 2000 Nigeria 1982, 1986, 1992, 2001, 2004 South Africa 1985, 1989, 1993 Zambia 1983 Zimbabwe 1965, 2000 Source: Carmen M. Reinhart and Kenneth Rogoff, This Time Is Different: Eight Centuries of Financial Folly. While Chen Yuan’s father, Chen Yun, advocated that China cross the river while feeling for the stones, the West took a different approach to Africa: Countries were urged to implement austerity and liberalize prices all at once. As China’s planners believed in the 1980s, excessive or too-quick market liberalization could be a disaster if countries had not built up strong enough institutions.

No Ordinary Disruption: The Four Global Forces Breaking All the Trends by Richard Dobbs, James Manyika

2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, access to a mobile phone, additive manufacturing, Airbnb, Amazon Mechanical Turk, American Society of Civil Engineers: Report Card, asset light, autonomous vehicles, Bakken shale, barriers to entry, business cycle, business intelligence, carbon tax, Carmen Reinhart, central bank independence, circular economy, cloud computing, corporate governance, creative destruction, crowdsourcing, data science, demographic dividend, deskilling, digital capitalism, disintermediation, disruptive innovation, distributed generation, driverless car, Erik Brynjolfsson, financial innovation, first square of the chessboard, first square of the chessboard / second half of the chessboard, Gini coefficient, global supply chain, global village, high-speed rail, hydraulic fracturing, illegal immigration, income inequality, index fund, industrial robot, intangible asset, Intergovernmental Panel on Climate Change (IPCC), Internet of things, inventory management, job automation, Just-in-time delivery, Kenneth Rogoff, Kickstarter, knowledge worker, labor-force participation, low interest rates, low skilled workers, Lyft, M-Pesa, machine readable, mass immigration, megacity, megaproject, mobile money, Mohammed Bouazizi, Network effects, new economy, New Urbanism, ocean acidification, oil shale / tar sands, oil shock, old age dependency ratio, openstreetmap, peer-to-peer lending, pension reform, pension time bomb, private sector deleveraging, purchasing power parity, quantitative easing, recommendation engine, Report Card for America’s Infrastructure, RFID, ride hailing / ride sharing, Salesforce, Second Machine Age, self-driving car, sharing economy, Silicon Valley, Silicon Valley startup, Skype, smart cities, Snapchat, sovereign wealth fund, spinning jenny, stem cell, Steve Jobs, subscription business, supply-chain management, synthetic biology, TaskRabbit, The Great Moderation, trade route, transaction costs, Travis Kalanick, uber lyft, urban sprawl, Watson beat the top human players on Jeopardy!, working-age population, Zipcar

This rapid expansion of buildings in turn fuels demand for resource-intensive infrastructure—utilities, roads, and transportation.21 These trends are likely to power through any short-term reversals. “The integration of 2.5 billion people (China and India alone) into the global economy is producing a demand shift that is likely to put far more upward pressure on commodity prices than any technology gains are likely to offset,” notes Kenneth Rogoff, professor of economics and public policy at Harvard University. “So, for at least the next 50 to 75 years, and perhaps until humans start mining on Mars sometime in the coming centuries, prices for many natural resources are headed up.”22 Resource prices have increased significantly since 2000 1 Based on arithmetic average of four commodity subindexes: food, nonfood agricultural items, metals, and energy.

…

In this new macroeconomic territory, a traditional view of supply and demand fundamentals may no longer be a sufficient indicator for the future cost of capital. As illustrated by the European Central Bank’s move in the spring of 2014 to lower its benchmark deposit interest rate below zero, ultralow interest rates may remain the norm over the coming years.43 As economists Carmen Reinhart and Kenneth Rogoff argued in a 2013 IMF paper, policy makers need to guard against overplaying the risks related to unconventional monetary support and limiting central banks’ room for policy maneuvering.44 HOW TO ADAPT As demand-supply dynamics change, business leaders need to be prepared to navigate both worlds.

…

“GE partners with the Millennium Challenge Corporation to provide $500 million in financing to Ghana 1000 project” (press release), August 5, 2014, http://allafrica.com/stories/201408061542.html; “GE to invest $2 billion in Africa by 2018” (press release), Business Wire, August 4, 2014, www.businesswire.com/news/home/20140803005030/en/GE-Invest-2-Billion-Africa-2018#.VDQoFvk7u-0. 48. Daniel Gross, “Coke applies supply-chain expertise to deliver AIDS drugs in Africa,” The Daily Beast, September 25, 2012, www.thedailybeast.com/articles/2012/09/25/coke-applies-supply-chain-expertise-to-deliver-aids-drugs-in-africa.html. 49. Kenneth Rogoff, “Can Greece avoid the lion,” Project Syndicate, February 3, 2010, www.project-syndicate.org/commentary/can-greece-avoid-the-lion-. 50. Stephen Hall, Dan Lovallo, and Reinier Musters, “How to put your money where your strategy is,” McKinsey Quarterly, March 2012. 51. Katy George, Sree Ramaswamy, and Lou Rassey, “Next-shoring: A CEO’s guide,” McKinsey Quarterly, January 2014. 52.

The Currency Cold War: Cash and Cryptography, Hash Rates and Hegemony by David G. W. Birch

"World Economic Forum" Davos, Alan Greenspan, algorithmic management, AlphaGo, bank run, Big Tech, bitcoin, blockchain, Bretton Woods, BRICs, British Empire, business cycle, capital controls, cashless society, central bank independence, COVID-19, cross-border payments, cryptocurrency, Diane Coyle, disintermediation, distributed ledger, Donald Trump, driverless car, Elon Musk, Ethereum, ethereum blockchain, facts on the ground, fault tolerance, fiat currency, financial exclusion, financial innovation, financial intermediation, floating exchange rates, forward guidance, Fractional reserve banking, global reserve currency, global supply chain, global village, Hyman Minsky, information security, initial coin offering, Internet of things, Jaron Lanier, Kenneth Rogoff, knowledge economy, M-Pesa, Mark Zuckerberg, market clearing, market design, Marshall McLuhan, mobile money, Money creation, money: store of value / unit of account / medium of exchange, moral hazard, Network effects, new economy, Northern Rock, one-China policy, Overton Window, PalmPilot, pattern recognition, Pingit, QR code, quantum cryptography, race to the bottom, railway mania, ransomware, Real Time Gross Settlement, reserve currency, Satoshi Nakamoto, seigniorage, Silicon Valley, smart contracts, social distancing, sovereign wealth fund, special drawing rights, subscription business, the payments system, too big to fail, transaction costs, Vitalik Buterin, Washington Consensus

As I have said before, and will say again, I think Craig Wright (the Australian who some people think is the mysterious Satoshi Nakamoto) made the key observation on this topic when he said: ‘The mining of Bitcoin is a security service that alone creates no wealth. Consequently, those using the network pay for the service.’ A shared security service that people will pay to use seems like a much better way to imagine future versions of Bitcoin than as a new form of payment or as a new kind of currency. Kenneth Rogoff, former IMF chief economist, echoes this perspective (Rogoff 2016). This shared security service may be used for a great many things, most of them as yet undiscovered, and I do not doubt that people will try and possibly manage to build a viable payment service on top of it: perhaps even a full-fledged digital currency.

…

And if an ATM goes down, so what? When it comes back up, it can simply resynchronize itself. Part 3 The Currency Cold War The real challenge for the United States isn’t Facebook’s proposed Libra; it’s government-backed digital currencies like the one planned by China. — Kenneth Rogoff, professor of economics and public policy at Harvard University (November 2019) In the seventeenth century, the Bank of Amsterdam created an innovative financial instrument that was in effect a standing repurchase agreement (repo) facility (Quinn et al. 2020). Eligible coins could be sold to the bank and repurchased within six months at an interest rate of 0.25%.

…

However, once the wind farm is up and running and producing electricity, the value of the money will rise. There might, in this case, be a demand for renewable energy that drives the value of the money higher than its original face value. Interest in the concept of privately issued money has been rekindled in the age of ‘platform’ technology firms such as Facebook. The economists Yang You and Kenneth Rogoff wrote in a recent paper on this topic that unless introducing tradability (which is Libra’s plan) creates very significant convenience for users, such platforms can potentially earn higher revenues by keeping tokens non-tradable. Their analysis suggests that if platforms have any comparative advantage in issuing tradable tokens, it comes from other factors (You and Rogoff 2019).

The Age of Stagnation: Why Perpetual Growth Is Unattainable and the Global Economy Is in Peril by Satyajit Das

"there is no alternative" (TINA), "World Economic Forum" Davos, 9 dash line, accounting loophole / creative accounting, additive manufacturing, Airbnb, Alan Greenspan, Albert Einstein, Alfred Russel Wallace, Anthropocene, Anton Chekhov, Asian financial crisis, banking crisis, Bear Stearns, Berlin Wall, bitcoin, bond market vigilante , Bretton Woods, BRICs, British Empire, business cycle, business process, business process outsourcing, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, carbon tax, Carmen Reinhart, Clayton Christensen, cloud computing, collaborative economy, colonial exploitation, computer age, creative destruction, cryptocurrency, currency manipulation / currency intervention, David Ricardo: comparative advantage, declining real wages, Deng Xiaoping, deskilling, digital divide, disintermediation, disruptive innovation, Downton Abbey, Emanuel Derman, energy security, energy transition, eurozone crisis, financial engineering, financial innovation, financial repression, forward guidance, Francis Fukuyama: the end of history, full employment, geopolitical risk, gig economy, Gini coefficient, global reserve currency, global supply chain, Goldman Sachs: Vampire Squid, Great Leap Forward, Greenspan put, happiness index / gross national happiness, high-speed rail, Honoré de Balzac, hydraulic fracturing, Hyman Minsky, illegal immigration, income inequality, income per capita, indoor plumbing, informal economy, Innovator's Dilemma, intangible asset, Intergovernmental Panel on Climate Change (IPCC), it is difficult to get a man to understand something, when his salary depends on his not understanding it, It's morning again in America, Jane Jacobs, John Maynard Keynes: technological unemployment, junk bonds, Kenneth Rogoff, Kevin Roose, knowledge economy, knowledge worker, Les Trente Glorieuses, light touch regulation, liquidity trap, Long Term Capital Management, low interest rates, low skilled workers, Lyft, Mahatma Gandhi, margin call, market design, Marshall McLuhan, Martin Wolf, middle-income trap, Mikhail Gorbachev, military-industrial complex, Minsky moment, mortgage debt, mortgage tax deduction, new economy, New Urbanism, offshore financial centre, oil shale / tar sands, oil shock, old age dependency ratio, open economy, PalmPilot, passive income, peak oil, peer-to-peer lending, pension reform, planned obsolescence, plutocrats, Ponzi scheme, Potemkin village, precariat, price stability, profit maximization, pushing on a string, quantitative easing, race to the bottom, Ralph Nader, Rana Plaza, rent control, rent-seeking, reserve currency, ride hailing / ride sharing, rising living standards, risk/return, Robert Gordon, Robert Solow, Ronald Reagan, Russell Brand, Satyajit Das, savings glut, secular stagnation, seigniorage, sharing economy, Silicon Valley, Simon Kuznets, Slavoj Žižek, South China Sea, sovereign wealth fund, Stephen Fry, systems thinking, TaskRabbit, The Chicago School, The Great Moderation, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, the market place, the payments system, The Spirit Level, Thorstein Veblen, Tim Cook: Apple, too big to fail, total factor productivity, trade route, transaction costs, uber lyft, unpaid internship, Unsafe at Any Speed, Upton Sinclair, Washington Consensus, We are the 99%, WikiLeaks, Y2K, Yom Kippur War, zero-coupon bond, zero-sum game

Lazear, Economic Imperialism, Hoover Institution and Graduate School of Business, Stanford University, May 1999. http://faculty-gsb.stanford.edu/lazear/personal/pdfs/economic%20imperialism.pdf. 2 John Maynard Keynes, General Theory of Employment, Interest and Money, Atlantic Publishers & Distributors (1936) 2006, p. 272. 3 Raghuram Rajan, “The Paranoid Style in Economics,” Project Syndicate, 8 August 2013. www.project-syndicate.org/commentary/the-declining-quality-of-public-economic-debate-by-raghuram-rajan. 4 G. K. Chesterton, Orthodoxy, Chapter VI, 1908. http://en.wikiquote.org/wiki/G._K._Chesterton. 5 Carmen M. Reinhart and Kenneth Rogoff, This Time Is Different: Eight Centuries of Financial Folly, Princeton University Press, 2009. 6 See Patrick Bernau, “‘Eine Hexenjagd’—Keneth Rogoff Über seinen Excel-Fehler,” Fazit, 22 October 2013. http://blogs.faz.net/fazit/2013/10/22/kenneth-rogoff-ueber-excel-fehler-hexenjagd-2818/. 7 Frederic Mishkin, “The Economist's Reply to the ‘Inside Job,’” Financial Times, 8 October 2010. 8 Quoted in Robert John, “Behind the Balfour Declaration: Britain's Great War Pledge to Lord Rothschild,” The Journal of Historical Review, vol. 6, no. 4 (Winter 1985–6), pp. 389–450. 9 See Neil Irwin, “With Consumers Slow to Spend, Businesses Are Slow to Hire,” Washington Post, 21 August 2010. 10 Tim Duy, “Yes, I Am Optimistic,” 30 November 2014. http://economistsview.typepad.com/timduy/2014/11/yes-i-am-optimistic-1.html. 11 Wynne Godley, “Macroeconomics without Equilibrium or Disequilibrium,” The Jerome Levy Economics Institute, Working Paper No. 205, August 1997. www.levyinstitute.org/pubs/wp205.pdf. 12 Olivier Blanchard, “Monetary Policy Will Never Be the Same,” IMF Direct, 19 November 2013. http://blog-imfdirect.imf.org/2013/11/19/monetary-policy-will-never-be-the-same/. 13 Fyodor Dostoyevsky, trans.

…

Similarly, expansionary fiscal policy in an environment of contracting private sector demand and reduction in debt can result in lower multipliers, as the government cannot fully offset the fall in private economic activity. Budget deficits must be financed, requiring governments to borrow. By 2009, there was increasing unease about rising government debt. Based on data from hundreds of years of financial crises, economists Carmen Reinhart and Kenneth Rogoff argued that sovereign debt levels above 60–90 percent of GDP affected growth.5 In 2013, in the academic equivalent of Fight Club, three economists from the University of Massachusetts in Amherst published a paper alleging that Reinhart and Rogoff had exaggerated the decline in growth at higher debt levels, due to unorthodox statistical choices and a spreadsheet error.

…

With their membership of the club of celebrity economists threatened, Reinhart and Rogoff mounted a desperate defense: they had not stressed any single number in their analysis; they had not implied causality; recalculation still supported their thesis. But in previous opinion pieces, speeches, and interviews, they had not mentioned these caveats, suggesting instead that the relationship held, and favoring cutting debt levels aggressively. Kenneth Rogoff darkly accused his critics of orchestrating a 1950s McCarthyist witch-hunt.6 Pressure for grant funding, the lure of lucrative commercial opportunities, and vanity have corrupted academic standards and reduced professional accountability. In his 2010 film Inside Job, Charles Ferguson interviewed former Federal Reserve vice chairman Frederic Mishkin, who was paid US$124,000 for a study on Iceland.

Austerity: The History of a Dangerous Idea by Mark Blyth

"there is no alternative" (TINA), accounting loophole / creative accounting, Alan Greenspan, balance sheet recession, bank run, banking crisis, Bear Stearns, Black Swan, book value, Bretton Woods, business cycle, buy and hold, capital controls, Carmen Reinhart, Celtic Tiger, central bank independence, centre right, collateralized debt obligation, correlation does not imply causation, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency peg, debt deflation, deindustrialization, disintermediation, diversification, en.wikipedia.org, ending welfare as we know it, Eugene Fama: efficient market hypothesis, eurozone crisis, financial engineering, financial repression, fixed income, floating exchange rates, Fractional reserve banking, full employment, German hyperinflation, Gini coefficient, global reserve currency, Greenspan put, Growth in a Time of Debt, high-speed rail, Hyman Minsky, income inequality, information asymmetry, interest rate swap, invisible hand, Irish property bubble, Joseph Schumpeter, Kenneth Rogoff, liberal capitalism, liquidationism / Banker’s doctrine / the Treasury view, Long Term Capital Management, low interest rates, market bubble, market clearing, Martin Wolf, Minsky moment, money market fund, moral hazard, mortgage debt, mortgage tax deduction, Occupy movement, offshore financial centre, paradox of thrift, Philip Mirowski, Phillips curve, Post-Keynesian economics, price stability, quantitative easing, rent-seeking, reserve currency, road to serfdom, Robert Solow, savings glut, short selling, structural adjustment programs, tail risk, The Great Moderation, The Myth of the Rational Market, The Wealth of Nations by Adam Smith, Tobin tax, too big to fail, Two Sigma, unorthodox policies, value at risk, Washington Consensus, zero-sum game

It’s a problem, and those arguing for austerity out of more than just an innate hatred of the state and all its works are not tilting at windmills. While we may not be “drowning in debt,” there are many folks out there who are concerned that we will do a bit more than just get our feet wet if we are not careful. Carmen Reinhardt and Kenneth Rogoff’s much-cited paper, “Growth in a Time of Debt,” argues that government debt above a critical threshold of 90 percent can become a substantial drag on the economy.17 This claim is not without its critics, but notwithstanding those criticisms, the basic point can be rephrased as, why would any state want to carry and pay for such a debt load if it didn’t have to?

…

In all cases, private-sector weaknesses ended up creating public-sector liabilities that European publics now have to pay for with austerity programs that make the situation worse rather than better. The fiscal crisis in all these countries was the consequence of the financial crisis washing up on their shores, not its cause. To say that it is the cause is to deliberately, and politically, confuse cause and effect. We really should know better. Carmen Reinhart and Kenneth Rogoff, no friends of Keynesian policy, note that a banking crisis is followed by a sovereign debt crisis 80 percent of the time.42 Reinhardt and Rogoff stop short of using the word “cause.” However, as Moritz Schularick and Alan Taylor have shown, sovereign debt crises are almost always “credit booms gone bust.”43 They develop in the private sector and end up in the public sector.

…

Leigh Phillips, “ECB Austerity Drive Raises Fears for Democratic Accountability in Europe,” The Guardian, August 22, 2011; Mort Zuckerman, “America Has No Choice but to Enter Its Own Age of Austerity,” Financial Times, July 14, 2011, “The A-List” Commentary; Alberto Alesina, Silvio Ardagna, Roberto Perotti, and Fabiano Schiantarelli (2002), “Fiscal Policy, Profits, and Investment,” American Economic Review, 92(3): 571–589; Peter Coy, “What Good Are Economists Anyway?” Bloomberg Business Week, April 16, 2009, cover story. 17. Carmen Reinhardt and Kenneth Rogoff, Growth in a Time of Debt, National Bureau of Economic Research (hereafter, NBER) working paper 15639, Cambridge, MA, January 2010. 18. See, for example, John Irons and Josh Bivens, “Government Debt and Economic Growth: Overreaching Claims of Debt ‘Threshold’ Suffer from Theoretical and Empirical Flaws,” Economic Policy Institute, Briefing Paper 271, Washington DC, July 16, 2010.

The Price of Time: The Real Story of Interest by Edward Chancellor

"World Economic Forum" Davos, 3D printing, activist fund / activist shareholder / activist investor, Airbnb, Alan Greenspan, asset allocation, asset-backed security, assortative mating, autonomous vehicles, balance sheet recession, bank run, banking crisis, barriers to entry, Basel III, Bear Stearns, Ben Bernanke: helicopter money, Bernie Sanders, Big Tech, bitcoin, blockchain, bond market vigilante , bonus culture, book value, Bretton Woods, BRICs, business cycle, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, carried interest, cashless society, cloud computing, cognitive dissonance, collapse of Lehman Brothers, collateralized debt obligation, commodity super cycle, computer age, coronavirus, corporate governance, COVID-19, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, cryptocurrency, currency peg, currency risk, David Graeber, debt deflation, deglobalization, delayed gratification, Deng Xiaoping, Detroit bankruptcy, distributed ledger, diversified portfolio, Dogecoin, Donald Trump, double entry bookkeeping, Elon Musk, equity risk premium, Ethereum, ethereum blockchain, eurozone crisis, everywhere but in the productivity statistics, Extinction Rebellion, fiat currency, financial engineering, financial innovation, financial intermediation, financial repression, fixed income, Flash crash, forward guidance, full employment, gig economy, Gini coefficient, Glass-Steagall Act, global reserve currency, global supply chain, Goodhart's law, Great Leap Forward, green new deal, Greenspan put, high net worth, high-speed rail, housing crisis, Hyman Minsky, implied volatility, income inequality, income per capita, inflation targeting, initial coin offering, intangible asset, Internet of things, inventory management, invisible hand, Japanese asset price bubble, Jean Tirole, Jeff Bezos, joint-stock company, Joseph Schumpeter, junk bonds, Kenneth Rogoff, land bank, large denomination, Les Trente Glorieuses, liquidity trap, lockdown, Long Term Capital Management, low interest rates, Lyft, manufacturing employment, margin call, Mark Spitznagel, market bubble, market clearing, market fundamentalism, Martin Wolf, mega-rich, megaproject, meme stock, Michael Milken, Minsky moment, Modern Monetary Theory, Mohammed Bouazizi, Money creation, money market fund, moral hazard, mortgage debt, negative equity, new economy, Northern Rock, offshore financial centre, operational security, Panopticon Jeremy Bentham, Paul Samuelson, payday loans, peer-to-peer lending, pensions crisis, Peter Thiel, Philip Mirowski, plutocrats, Ponzi scheme, price mechanism, price stability, quantitative easing, railway mania, reality distortion field, regulatory arbitrage, rent-seeking, reserve currency, ride hailing / ride sharing, risk free rate, risk tolerance, risk/return, road to serfdom, Robert Gordon, Robinhood: mobile stock trading app, Satoshi Nakamoto, Satyajit Das, Savings and loan crisis, savings glut, Second Machine Age, secular stagnation, self-driving car, shareholder value, Silicon Valley, Silicon Valley startup, South Sea Bubble, Stanford marshmallow experiment, Steve Jobs, stock buybacks, subprime mortgage crisis, Suez canal 1869, tech billionaire, The Great Moderation, The Rise and Fall of American Growth, The Wealth of Nations by Adam Smith, Thorstein Veblen, Tim Haywood, time value of money, too big to fail, total factor productivity, trickle-down economics, tulip mania, Tyler Cowen, Uber and Lyft, Uber for X, uber lyft, Walter Mischel, WeWork, When a measure becomes a target, yield curve

Could it be that the monetary policy experiments after the Lehman crisis did more harm than good? That was the view of PIMCO’s ‘Bond King’ Bill Gross, who, displaying his own science credentials, suggested that just as Newtonian physics breaks down at the speed of light, so a market economy ceases to function normally when interest rates approach the zero lower bound.4 Harvard economist Kenneth Rogoff stuck with this theme: Just as the normal laws of physics seem to be upended when an object approaches a black hole (or, to be more precise, the normal laws imply weird consequences), the laws of economics seem to be upended when a recession-stricken economy hits (or at least approaches) the zero bound.5 In his letters to investors, PIMCO’s bond manager described how the financial system needs a positive spread or carry between borrowing and lending rates.

…

By this date, there had been an estimated 637 rate cuts globally since the failure of Bear Stearns in early 2008, central banks had purchased more than $14 trillion worth of securities, and more than $8 trillion worth of government bonds yielded less than zero.22 11. By December 2020 nearly $18 trillion worth of bonds were yielding less than zero. Negative interest rates were intended, as Harvard’s Kenneth Rogoff put it, to ‘turbocharge the economy out of a deflationary recession’.23 But they failed to live up to this promise. In fact, they exacerbated the problems already produced by ultra-low rates. From the outset, negative rates created a tremendous challenge for conventional banks. When they were introduced into Europe, the head of Portugal’s central bank viewed them as a threat to the financial system.24 European banks felt unable to pass on the cost to depositors.

…

After all, what is a negative interest rate but a tax on capital – taxation without representation, no less? There appeared to be no limit on how far central bankers might go to enforce their policies. If hoarding thwarted their negative interest-rate policy, then it was time to abolish cash.24 The ‘paper currency’, wrote Kenneth Rogoff in his 2016 book The Curse of Cash, ‘has become a major impediment to the smooth functioning of the global financial system.’25 What the former IMF chief economist meant was that the existence of banknotes impeded the central bankers’ ability to engage in radical monetary experiments. A cashless world, Rogoff admitted, would look different to the one we were used to.

Britannia Unchained: Global Lessons for Growth and Prosperity by Kwasi Kwarteng, Priti Patel, Dominic Raab, Chris Skidmore, Elizabeth Truss

Airbnb, banking crisis, Carmen Reinhart, central bank independence, clockwatching, creative destruction, Credit Default Swap, demographic dividend, Edward Glaeser, eurozone crisis, fail fast, fear of failure, financial engineering, glass ceiling, informal economy, James Dyson, Kenneth Rogoff, knowledge economy, long peace, margin call, Mark Zuckerberg, Martin Wolf, megacity, Mexican peso crisis / tequila crisis, Neil Kinnock, new economy, North Sea oil, oil shock, open economy, paypal mafia, pension reform, price stability, profit motive, Ronald Reagan, Sand Hill Road, Silicon Valley, Stanford marshmallow experiment, Steve Jobs, Suez crisis 1956, tech worker, Walter Mischel, wealth creators, Winter of Discontent, working-age population, Yom Kippur War

If it is really is impossible for countries to go bust, then it is strange that so many countries have failed to pay back their loans. From Edward III defaulting on his loans to Florence financiers in 134039 through to today’s Eurozone crisis, sovereign defaults have been a constant feature throughout history. In their definitive text, This Time is Different, economists Carmen M. Reinhart and Kenneth S. Rogoff list hundreds of examples of default through the last 800 years. Default is not just not unknown, it is endemic. Only a small number of countries – such as Australia, New Zealand, Canada, Denmark, Thailand and the United States40 – have never defaulted. The UK has been relatively fortunate in past centuries, but it too defaulted.

…

The whole purpose of the Golden Rule was to allow greater discretionary deficits in economic downturns; the Government could point to the surpluses it had already run since 1997. As long as its budget forecasts were reasonably accurate, Brown should meet his primary fiscal rule, to balance the budget ‘over the course of the cycle’. Even Kenneth Rogoff, then the Chief Economist of the IMF, gave the plans his cautious approval.67 He did, however, warn that deficits should not be allowed to rise above their currently forecast path. The forecasts did not prove to be accurate. The Government’s budget never moved back into structural surplus,68 let alone ran an actual surplus.

…

Macaulay, History of England. 30. http://krugman.blogs.nytimes.com/2011/12/04/british-debt-history/ 31. http://krugman.blogs.nytimes.com/2011/11/30/bleeding-britain/ 32. http://johannhari.com/2011/03/29/the-biggest-lie-in-british-politics/ 33. http://www.ft.com/cms/s/0/a9042452-1a3c-11de-9f91-0000779fd2ac. html#axzz1gJPBneNS 34. http://www.newstatesman.com/blogs/david-blanchflower/2011/06/creditcard-cameron-basic 35. Niall Ferguson, The Cash Nexus: Money and Power in the Modern World, 1700–2000 (Penguin, 2001), p. 53. 36. Ferguson, The Cash Nexus, p. 129. 37. Ferguson, The Cash Nexus, p. 130. 38. Office for Budget Responsibility, Economic and Fiscal Outlook, March 2012. 39. Carmen Reinhart and Kenneth Rogoff, This Time is Different: Eight Centuries of Financial Folly (Princeton University Press, 2009). 40. Reinhart and Rogoff, This Time is Different. 41. http://www.thedailybeast.com/newsweek/2009/11/27/an-empire-at-risk.html 42. http://www.thedailybeast.com/newsweek/2009/11/27/an-empire-at-risk.html 43.

Breakout Nations: In Pursuit of the Next Economic Miracles by Ruchir Sharma

"World Economic Forum" Davos, 3D printing, affirmative action, Alan Greenspan, Albert Einstein, American energy revolution, anti-communist, Asian financial crisis, banking crisis, Berlin Wall, book value, BRICs, British Empire, business climate, business cycle, business process, business process outsourcing, call centre, capital controls, Carmen Reinhart, central bank independence, centre right, cloud computing, collective bargaining, colonial rule, commodity super cycle, corporate governance, creative destruction, crony capitalism, deindustrialization, demographic dividend, Deng Xiaoping, eurozone crisis, financial engineering, Gini coefficient, global macro, global supply chain, Goodhart's law, high-speed rail, housing crisis, income inequality, indoor plumbing, inflation targeting, informal economy, junk bonds, Kenneth Rogoff, knowledge economy, labor-force participation, land reform, low interest rates, M-Pesa, Mahatma Gandhi, Marc Andreessen, market bubble, Masayoshi Son, mass immigration, megacity, Mexican peso crisis / tequila crisis, middle-income trap, Nelson Mandela, new economy, no-fly zone, oil shale / tar sands, oil shock, open economy, Peter Thiel, planetary scale, public intellectual, quantitative easing, reserve currency, Robert Gordon, rolling blackouts, Shenzhen was a fishing village, Silicon Valley, software is eating the world, sovereign wealth fund, The Great Moderation, Thomas L Friedman, trade liberalization, Tyler Cowen, Watson beat the top human players on Jeopardy!, working-age population, zero-sum game

The growing ties between nations over the last decade have made every one of them less inclined to allow their trade partners to go under. For all the current discussion about debt defaults, stemming from the crisis in Greece, the reality is that default has largely disappeared from the international economic scene. In their book, This Time Is Different, Carmen Reinhart and Kenneth Rogoff chart how surprisingly commonplace default used to be: In a typical year between the 1920s and 2003, nations representing at least 5 to 10 percent of global income were in default, and that proportion spiked up to 40 percent during the Depression and World War II, and close to 15 percent in the late 1980s.

…

The high debt burden is indeed weighing on the long-term U.S. growth rate, which is widely believed to have fallen from 3.4 percent between 1950 and 2007 to 2 percent, which is slower than during the recovery phase of most postwar recessions. There is a widespread sense that America has lost its mojo. In a recent paper, however, Harvard economists Carmen Reinhart and Kenneth Rogoff point out that the relevant comparison is not previous U.S. recessions but the very different case of systemic financial crises. These are much more traumatic and rare, and by this standard the United States is recovering lost per capita output faster than it did following previous systemic crises, from the meltdown of 1873 through the Great Depression, and faster than most Western nations following the systemic crisis of 2008.

…

As Tyler Cowen points out, the United States is a leading exporter of products that lie in the “sweet spot” for future demand from the emerging world, including civilian aircraft, semiconductors, cars, pharmaceuticals, machinery and equipment, automobile accessories, and entertainment. Technology, Inequality, and the Debt Threat There is an undeniable and scary connection between technology and persistent or rising income inequality, an issue that has remarkable resonance everywhere I travel, from Chile to South Korea. Kenneth Rogoff has called inequality “the single biggest threat to social stability around the world,” and for good reason. A decade ago the technorati were predicting that a wireless, digital world would give working people a welcome windfall in leisure time, but the reality looks a lot less comfortable. As companies employ digital machines more efficiently, they need fewer people and will pay more for the relatively few people skilled in handling digital machines.

Never Let a Serious Crisis Go to Waste: How Neoliberalism Survived the Financial Meltdown by Philip Mirowski

"there is no alternative" (TINA), Adam Curtis, Alan Greenspan, Alvin Roth, An Inconvenient Truth, Andrei Shleifer, asset-backed security, bank run, barriers to entry, Basel III, Bear Stearns, behavioural economics, Berlin Wall, Bernie Madoff, Bernie Sanders, Black Swan, blue-collar work, bond market vigilante , bread and circuses, Bretton Woods, Brownian motion, business cycle, capital controls, carbon credits, Carmen Reinhart, Cass Sunstein, central bank independence, cognitive dissonance, collapse of Lehman Brothers, collateralized debt obligation, complexity theory, constrained optimization, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, dark matter, David Brooks, David Graeber, debt deflation, deindustrialization, democratizing finance, disinformation, do-ocracy, Edward Glaeser, Eugene Fama: efficient market hypothesis, experimental economics, facts on the ground, Fall of the Berlin Wall, financial deregulation, financial engineering, financial innovation, Flash crash, full employment, George Akerlof, Glass-Steagall Act, Goldman Sachs: Vampire Squid, Greenspan put, Hernando de Soto, housing crisis, Hyman Minsky, illegal immigration, income inequality, incomplete markets, information asymmetry, invisible hand, Jean Tirole, joint-stock company, junk bonds, Kenneth Arrow, Kenneth Rogoff, Kickstarter, knowledge economy, l'esprit de l'escalier, labor-force participation, liberal capitalism, liquidity trap, loose coupling, manufacturing employment, market clearing, market design, market fundamentalism, Martin Wolf, money market fund, Mont Pelerin Society, moral hazard, mortgage debt, Naomi Klein, Nash equilibrium, night-watchman state, Northern Rock, Occupy movement, offshore financial centre, oil shock, Pareto efficiency, Paul Samuelson, payday loans, Philip Mirowski, Phillips curve, Ponzi scheme, Post-Keynesian economics, precariat, prediction markets, price mechanism, profit motive, public intellectual, quantitative easing, race to the bottom, random walk, rent-seeking, Richard Thaler, road to serfdom, Robert Shiller, Robert Solow, Ronald Coase, Ronald Reagan, Savings and loan crisis, savings glut, school choice, sealed-bid auction, search costs, Silicon Valley, South Sea Bubble, Steven Levy, subprime mortgage crisis, tail risk, technoutopianism, The Chicago School, The Great Moderation, the map is not the territory, The Myth of the Rational Market, the scientific method, The Theory of the Leisure Class by Thorstein Veblen, The Wisdom of Crowds, theory of mind, Thomas Kuhn: the structure of scientific revolutions, Thorstein Veblen, Tobin tax, tontine, too big to fail, transaction costs, Tyler Cowen, vertical integration, Vilfredo Pareto, War on Poverty, Washington Consensus, We are the 99%, working poor

In subscribing to this notion, the left unconsciously accepts the key notion of the populist right and the neoclassical orthodoxy, that “nothing is substantially different between then and now.” Markets are timeless entities with timeless laws, they insist. Indeed, this is the identical premise of some of the most popular crisis books of the last few years, from Kenneth Rogoff and Carmen Reinhart’s This Time Is Different to David Graeber’s Debt: The First 5,000 Years.24 Yet that is precisely where the polemical divergence should originate on the left. Things are profoundly different about the economy, the society, and in the global political arena than they were during the Cold War: some recent neoliberal innovations have lent the current crisis its special bitter tang; understanding precisely how and where they are different is a necessary first step in developing a blueprint for a better world.

…

(The free flow of labor enjoys no similar right.97) Since that entails persistent balance-of-payments problems in a nonautarkic world, neoliberals took the lead in inventing all manner of transnational devices for the economic and political discipline of nation-states.98 They began by attempting to reintroduce what they considered to be pure market discipline (flexible exchange rates, dismantling capital controls) during the destruction of the Bretton Woods system, but over the longer term learned to appreciate that suitably staffed international institutions such as the WTO, the World Bank, the IMF, and other units are better situated to impose neoliberal policies upon recalcitrant nation-states. Initially strident demands to abolish global financial (and other) institutions on the part of early neoliberals such as Friedman and some denizens of the Cato Institute were subsequently tempered by others—such as Anne Krueger, Stanley Fischer, and Kenneth Rogoff—and as these neoliberals came to occupy these institutions, they used them primarily to influence staffing and policy decisions, and thus to displace other internationalist agendas. The role of such transnational organizations was recast to exert “lock-in” of prior neoliberal policies, and therefore to restrict the range of political options of national governments.

…

While both divergences could be traced to specific neoliberal triumphs in the teeth of the crisis—namely, the direct bailouts of large financial firms and their financialized counterparts in other sectors, combined with a ferocious resistance to any controls imposed upon capital flows and international trade—and as such might betoken further weakness down the line, journalists instead rapidly lost interest in the ways in which the current crisis might be “different” than the Great Depression. Indeed, they were rescued from having to seriously confront history by the intervention of a famous Harvard professor, and thus endorsed the convenient Kenneth Rogoff mantra that we could ignore anyone who insisted upon structural specificity in history, because every financial crisis was essentially the same.26 At that juncture, journalists just lost all interest in the Great Depression. * * * Figure 4.2: Index of World Equity Market Prices, Great Depression and Current Crisis * * * * * * Figure 4.3: Index Volume of World Trade, Great Depression and Current Crisis * * * * * * Source: voxeu.org This blasé line emanating from Harvard and the National Bureau of Economic Research committed the ultimate historical solecism by lumping together two centuries of credit crises as somehow “the same,” attempting to reduce them all to a few implausible quantitative indicators of sovereign debt to GNP and a “capital mobility index.”

Paper Money Collapse: The Folly of Elastic Money and the Coming Monetary Breakdown by Detlev S. Schlichter

bank run, banks create money, British Empire, business cycle, capital controls, Carmen Reinhart, central bank independence, currency peg, fixed income, Fractional reserve banking, German hyperinflation, global reserve currency, inflation targeting, Kenneth Rogoff, Kickstarter, Long Term Capital Management, low interest rates, market clearing, Martin Wolf, means of production, Money creation, money market fund, moral hazard, mortgage debt, open economy, Ponzi scheme, price discovery process, price mechanism, price stability, pushing on a string, quantitative easing, reserve currency, rising living standards, risk tolerance, savings glut, the market place, The Wealth of Nations by Adam Smith, Thorstein Veblen, transaction costs, We are all Keynesians now, Y2K

Ben Bernanke, Remarks before the National Economics Club, Washington, DC, Nov. 21, 2002, http://www.federalreserve.gov/boarddocs/speeches/2002/20021121/default.htm 2. Carmen M. Reinhart, Kenneth S. Rogoff, This Time Is Different: Eight Centuries of Financial Folly (Princeton and Oxford: Princeton University Press, 2009), pp. 204–207. 3. Board of Governors of the Federal Reserve System, http://www.federalreserve.gov/releases/h8/Current/ 4. Federal Reserve Statistical Release H.6 Money Stock Measures, http://www.federalreserve.gov/releases/h6/hist/ 5. Federal Reserve Bank of St. Louis, http://fraser.stlouisfed.org/publications/ERP/page/7254/download/46604/7254_ERP.pdf 6. Carmen M. Reinhart, Kenneth S. Rogoff, This Time Is Different: Eight Centuries of Financial Folly, p. 207 7.

…

For a historian’s account of these events, see Adam Ferguson, When Money Dies (London: Old Street Publishing, 2010/1975). 19. Peter Bernholz, Monetary Regimes and Inflation, p. 8. 20. Carmen M. Reinhart, Kenneth S. Rogoff, This Time Is Different: Eight Centuries of Financial Folly, p. 112. 21. Milton Friedman/Anna Jacobson Schwartz, A Monetary History of the United States, 1867–1960, pp. 461–493. 22. Quoted from John Laughland, The Tainted Source, p. 41. 23. Carmen M. Reinhart, Kenneth S. Rogoff, This Time Is Different: Eight Centuries of Financial Folly, pp. 204–206. Part Five: BEYOND THE CYCLE Paper Money Collapse Chapter 8 The Beneficiaries of the Paper Money System By now we have fully exposed the disadvantages and dangers of elastic money.

…

The inevitable consequences of the new infrastructure and policy have become ever more manifest. Since 1971 the decline in the purchasing power of pound and dollar—two of the oldest currencies in the world—has been the steepest in their long history. Debt levels have risen sharply and the financial industry has greatly expanded. As economists Carmen Reinhart and Kenneth Rogoff demonstrated in their extensive study of financial crises, the number and intensity of international banking crises has risen markedly since 1971.2 Japan experienced an enormous money-driven housing boom in the 1980s and has still not recovered from the dislocations this created. The United States and Western Europe (with the exception of the Scandinavian countries) have, until recently, escaped major crises.

Capitalism 4.0: The Birth of a New Economy in the Aftermath of Crisis by Anatole Kaletsky

"World Economic Forum" Davos, Alan Greenspan, bank run, banking crisis, Bear Stearns, behavioural economics, Benoit Mandelbrot, Berlin Wall, Black Swan, bond market vigilante , bonus culture, Bretton Woods, BRICs, business cycle, buy and hold, Carmen Reinhart, classic study, cognitive dissonance, collapse of Lehman Brothers, Corn Laws, correlation does not imply causation, creative destruction, credit crunch, currency manipulation / currency intervention, currency risk, David Ricardo: comparative advantage, deglobalization, Deng Xiaoping, eat what you kill, Edward Glaeser, electricity market, Eugene Fama: efficient market hypothesis, eurozone crisis, experimental economics, F. W. de Klerk, failed state, Fall of the Berlin Wall, financial deregulation, financial innovation, Financial Instability Hypothesis, floating exchange rates, foreign exchange controls, full employment, geopolitical risk, George Akerlof, global rebalancing, Goodhart's law, Great Leap Forward, Hyman Minsky, income inequality, information asymmetry, invisible hand, Isaac Newton, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, Kickstarter, laissez-faire capitalism, long and variable lags, Long Term Capital Management, low interest rates, mandelbrot fractal, market design, market fundamentalism, Martin Wolf, military-industrial complex, Minsky moment, Modern Monetary Theory, Money creation, money market fund, moral hazard, mortgage debt, Nelson Mandela, new economy, Nixon triggered the end of the Bretton Woods system, Northern Rock, offshore financial centre, oil shock, paradox of thrift, Pareto efficiency, Paul Samuelson, Paul Volcker talking about ATMs, peak oil, pets.com, Ponzi scheme, post-industrial society, price stability, profit maximization, profit motive, quantitative easing, Ralph Waldo Emerson, random walk, rent-seeking, reserve currency, rising living standards, Robert Shiller, Robert Solow, Ronald Reagan, Savings and loan crisis, seminal paper, shareholder value, short selling, South Sea Bubble, sovereign wealth fund, special drawing rights, statistical model, systems thinking, The Chicago School, The Great Moderation, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, too big to fail, Vilfredo Pareto, Washington Consensus, zero-sum game

The question that needs to be asked about the Japanese experience is whether government support for struggling banks and overindebted borrowers caused the twenty years of stagnation or whether twenty years of economic stagnation prevented a recovery for weak borrowers and banks. A similar question must be asked about a fascinating and much-quoted historic study, coauthored by Carmen Reinhart and Kenneth Rogoff, the IMF’s former chief economist, which looked at the macroeconomic effect of financial crises in dozens of countries over the past six hundred years. This study concluded that recessions accompanied by banking crises are generally much longer and deeper than recessions in which banks avoid serious losses.12 The question is whether this historic evidence proves that banking crises cause particularly severe recessions or that particularly severe recessions cause banking crises, which then make these recessions even worse.

…

Organisation for Economic Co-operation and Development (OECD), OECD Outlook 86 (November 2009). 4 There has been a long history of debt defaults by sovereign governments, and in every case creditors have been left with no legal or political redress. See Anatole Kaletsky, The Costs of Default, and Carmen M. Reinhart and Kenneth Rogoff, This Time Is Different: Eight Centuries of Financial Folly. 5 The figures for Treasury securities exclude the notional holdings owned by the federal government itself through the Social Security Trust Fund and other purely notional accounting entities. Federal Reserve Board, “Flow of Funds Accounts of the United States: Flows and Outstandings, Third Quarter 2009,” December 10, 2009. 6 Strictly speaking, the current account deficit is slightly different from the trade deficit, as explained in the text. 7 The current account deficit for the first three quarters of 2009, annualized, was $407 billion. 8 To be precise, real incomes sixty years from now will be 3.2 times higher if U.S. growth averages 1.96 percent per head, as it has since 1950, and 1.8 times higher if growth slows to 1 percent per head. 9 This assumes real economic growth of 3 percent real and 2 percent inflation. 10 International Monetary Fund, “Fiscal Implications of the Global Economic and Financial Crisis,” IMF Staff Position Note SPN/09/13, June 2009. 11 Japan suffered five recessions in the twenty years since 1990, while the United States had three recessions and Britain and the eurozone suffered two each. 12 Reinhart and Rogoff, This Time Is Different. 13 Kaletsky, The Costs of Default. 14 See “Continental Illinois and ‘Too Big to Fail,’” in FDIC Division of Research and Statistics, History of the Eighties—Lessons for the Future, vol. 1, 235-257.

…

This was followed by the Louvre Accord of February 22, 1987, which helped to stabilize the dollar-yen exchange rate for the next five years in the range of 125-150, but was subsequently blamed for contributing to the 1987 crash on Wall Street and the Japanese bubble economy of 1988-89. 24 A good summary of recent thinking is John Williamson, “The Choice of Exchange Rate Regime: The Relevance of International Experience to China’s Decision,” Lecture at the Central University of Finance and Economics in Beijing on September 7, 2004. Available from the Institute for International Economics, Washington, DC, at http://www.iie.com/publications/papers/williamson0904.pdf. A more detailed study is Kenneth Rogoff et al., “Evolution and Performance of Exchange Rate Regimes,” IMF Occasional Paper 229, May 2004. 25 Michal Kalecki, Political Aspects of Full Employment, Political Quarterly 14 (1943), reprinted in Michal Kalecki, Selected Essays on the Dynamics of the Capitalist Economy. Chapter Seventeen 1 International Monetary Fund, “Fiscal Implications of the Global Economic and Financial Crisis.” 2 Ibid. 3 Ibid.

The Cost of Inequality: Why Economic Equality Is Essential for Recovery by Stewart Lansley

"World Economic Forum" Davos, Adam Curtis, air traffic controllers' union, Alan Greenspan, AOL-Time Warner, banking crisis, Basel III, Big bang: deregulation of the City of London, Bonfire of the Vanities, borderless world, Branko Milanovic, Bretton Woods, British Empire, business cycle, business process, call centre, capital controls, collective bargaining, corporate governance, corporate raider, correlation does not imply causation, creative destruction, credit crunch, Credit Default Swap, crony capitalism, David Ricardo: comparative advantage, deindustrialization, Edward Glaeser, Everybody Ought to Be Rich, falling living standards, financial deregulation, financial engineering, financial innovation, Financial Instability Hypothesis, floating exchange rates, full employment, Goldman Sachs: Vampire Squid, high net worth, hiring and firing, Hyman Minsky, income inequality, James Dyson, Jeff Bezos, job automation, job polarisation, John Meriwether, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, laissez-faire capitalism, Larry Ellison, light touch regulation, Londongrad, Long Term Capital Management, low interest rates, low skilled workers, manufacturing employment, market bubble, Martin Wolf, Mary Meeker, mittelstand, mobile money, Mont Pelerin Society, Myron Scholes, new economy, Nick Leeson, North Sea oil, Northern Rock, offshore financial centre, oil shock, plutocrats, Plutonomy: Buying Luxury, Explaining Global Imbalances, proprietary trading, Right to Buy, rising living standards, Robert Shiller, Robert Solow, Ronald Reagan, savings glut, shareholder value, The Great Moderation, The Spirit Level, The Wealth of Nations by Adam Smith, Thomas Malthus, too big to fail, Tyler Cowen, Tyler Cowen: Great Stagnation, Washington Consensus, Winter of Discontent, working-age population

Rising inequality may also have increased vulnerability to crisis.’47 Similar views were aired at the 2011 World Economic Forum, the influential gathering of the world’s political, economic and business elites held each year in the small Swiss ski resort of Davos. Here the question of the growing global divide became something of a theme in an agenda crowded with topics from stalling recovery to the tackling of mounting budget deficits. ‘Inequality is the big wildcard in the next decade of global growth’, Kenneth Rogoff, a leading authority on the history of financial crises, told one gathering at the Forum. At another session, Min Zhu, former Deputy Governor of the People’s Bank of China and a special adviser at the International Monetary Fund, told his audience: ‘The increase in inequality is the most serious challenge facing the world.’

…

Despite a series of economic, business and financial crises in the immediate postmillennium years—from the bursting of the dot-com bubble to the collapse of the energy-trading giant, Enron—the belief in markets proved remarkably resilient. Across the globe, regulators, politicians and financiers had come round to the view that, after a shaky decade and a half, the market model had finally triumphed. According to Kenneth Rogoff, chief economist at the IMF from 2001 to 2003, ‘the policy community has developed a smug belief that enhanced macroeconomic stability at the national level combined with continuing financial innovation at the international level have obviated any need to tinker with the (international financial) system’.206 The prophets of market ideology made grand claims for their beliefs.

…

As the American international investor and a man who knows a little about speculation and destabilisation, George Soros, has put it, ‘the salient feature of the current financial crisis is that it was not generated by some external shock like OPEC… The crisis was generated by the system itself.’261 Notes 206 Kenneth Rogoff, ‘No Grand Plans, but the Financial System Needs Fixing’, Financial Times, 8 February 2007. 207 IMF, World Economic Outlook, Database, April 2009. 208 Ibid. 209 T Morgan, ‘No Way Out’, Tullett Prebon Strategy Note 23, 2011. 210 GDP adjusted for inflation. 211 R Skidelsky, Keynes: The Return of the Master, Allen Lane, 2009, p 118-120. 212 Annual change in GDP, chained volume measure, seasonally adjusted (Office for National Statistics, series ABMI); http://www.statistics.gov.uk/statbase/TSDdownload2.asp. 213 Ibid. 214 Glyn, Capitalism Unleashed, op. cit. p 131. 215 Ibid. 216 World Economic Forum, The Global Competitiveness Report, 2009-10, 2009. 217 G L Bernstein, The Myth of Decline, Pimlico, 2004, p 572. 218 ONS, output per job for whole economy (series LNNP).

Economics Rules: The Rights and Wrongs of the Dismal Science by Dani Rodrik

airline deregulation, Alan Greenspan, Albert Einstein, bank run, barriers to entry, behavioural economics, Bretton Woods, business cycle, butterfly effect, capital controls, carbon tax, Carmen Reinhart, central bank independence, collective bargaining, congestion pricing, Daniel Kahneman / Amos Tversky, David Ricardo: comparative advantage, distributed generation, Donald Davies, Edward Glaeser, endogenous growth, Eugene Fama: efficient market hypothesis, Everything should be made as simple as possible, Fellow of the Royal Society, financial deregulation, financial innovation, floating exchange rates, fudge factor, full employment, George Akerlof, Gini coefficient, Growth in a Time of Debt, income inequality, inflation targeting, informal economy, information asymmetry, invisible hand, Jean Tirole, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, labor-force participation, liquidity trap, loss aversion, low skilled workers, market design, market fundamentalism, minimum wage unemployment, oil shock, open economy, Pareto efficiency, Paul Samuelson, price elasticity of demand, price stability, prisoner's dilemma, profit maximization, public intellectual, quantitative easing, randomized controlled trial, rent control, rent-seeking, Richard Thaler, risk/return, Robert Shiller, school vouchers, South Sea Bubble, spectrum auction, The Market for Lemons, the scientific method, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, Thomas Malthus, trade liberalization, trade route, ultimatum game, University of East Anglia, unorthodox policies, Vilfredo Pareto, Washington Consensus, white flight

If instead government is hopelessly corrupt, industrial policy will likely make things worse. Note how, in this case, research has pushed the disagreement onto a domain—public administration—in which economists have no particular expertise. Models, Authority, and Hierarchy Two well-known economists, Carmen Reinhart and Kenneth Rogoff, published a paper in 2010 that would become fodder in a political battle with high stakes.18 The paper appeared to show that public-debt levels above 90 percent of GDP significantly impede economic growth. Conservative US politicians and European Union officials latched on to this work to justify their ongoing call for fiscal austerity.

…

Itzhak Gilboa, Andrew Postlewaite, Larry Samuelson, and David Schmeidler, “Economic Models as Analogies” (unpublished paper, January 27, 2013), 6–7. 17. See, for example, my online debate for the Economist magazine with Harvard Business School professor Josh Lerner, July 12–17, 2010, http://www.economist.com/debate/debates/overview/177. 18. Carmen M. Reinhart and Kenneth S. Rogoff, Growth in a Time of Debt, NBER Working Paper 15639 (Cambridge, MA: National Bureau of Economic Research, 2010). 19. Thomas Herndon, Michael Ash, and Robert Pollin, “Does High Public Debt Consistently Stifle Economic Growth? A Critique of Reinhart and Rogoff” (Amherst: University of Massachusetts at Amherst, Political Economy Research Institute, April 15, 2013). 20.

…

Edward López and Wayne Leighton, Madmen, Intellectuals, and Academic Scribblers: The Economic Engine of Political Change (Stanford, CA: Stanford University Press, 2012). 15. Francisco Rodríguez and Dani Rodrik, “Trade Policy and Economic Growth: A Skeptic’s Guide to the Cross-National Evidence,” in Macroeconomics Annual 2000, eds. Ben Bernanke and Kenneth S. Rogoff (Cambridge, MA: MIT Press for NBER, 2001). 16. Mankiw, “News Flash: Economists Agree.” 17. Mark R. Rosenzweig and Kenneth I. Wolpin, “Natural ‘Natural Experiments’ in Economics,” Journal of Economic Literature 38, no. 4 (December 2000): 827–74. 18. Dani Rodrik, The Globalization Paradox: Democracy and the Future of the World Economy (New York: W.

10% Less Democracy: Why You Should Trust Elites a Little More and the Masses a Little Less by Garett Jones

Andrei Shleifer, Asian financial crisis, Brexit referendum, business cycle, central bank independence, clean water, corporate governance, correlation does not imply causation, creative destruction, Edward Glaeser, fake news, financial independence, game design, German hyperinflation, hive mind, invisible hand, James Carville said: "I would like to be reincarnated as the bond market. You can intimidate everybody.", Jean Tirole, Kenneth Rogoff, low interest rates, Mark Zuckerberg, mass incarceration, military-industrial complex, minimum wage unemployment, Mohammed Bouazizi, Neil Armstrong, open economy, Pareto efficiency, Paul Samuelson, price stability, rent control, Robert Solow, The Wealth of Nations by Adam Smith, trade liberalization, Tyler Cowen

, you’re still better off if you delegated the job of running monetary policy to a “conservative central banker,” one who only cares about a low, stable inflation rate and doesn’t care at all about the unemployment rate. This theory, created by former chess champion and current Harvard economist Kenneth Rogoff, goes something like this . . .¹⁰ The Conservative Central Banker: An Origin Story The only way to use monetary policy to boost the real economy is to surprise the citizens with cheap money. The cheap money gets people more spending and creates more jobs in the short run (before prices rise).

…

Alesina and Summers, “Central Bank Independence,” 159. 9. Alex Cukierman, “Central Bank Independence and Policy Results: Theory and Evidence,” lecture prepared for the Bank of Mexico international conference, “Stability and Economic Growth: The Role of the Central Bank,” Mexico City, 2005. 10. Kenneth Rogoff, “The Optimal Degree of Commitment to an Intermediate Monetary Target,” Quarterly Journal of Economics 100, no. 4 (1985): 1169–1189. 11. Finn E. Kydland and Edward C. Prescott, “Time to Build and Aggregate Fluctuations,” Econometrica (1982): 1345–1370. Also see John B. Long Jr. and Charles I.

The Road to Ruin: The Global Elites' Secret Plan for the Next Financial Crisis by James Rickards

"World Economic Forum" Davos, Affordable Care Act / Obamacare, Alan Greenspan, Albert Einstein, asset allocation, asset-backed security, bank run, banking crisis, barriers to entry, Bayesian statistics, Bear Stearns, behavioural economics, Ben Bernanke: helicopter money, Benoit Mandelbrot, Berlin Wall, Bernie Sanders, Big bang: deregulation of the City of London, bitcoin, Black Monday: stock market crash in 1987, Black Swan, blockchain, Boeing 747, Bonfire of the Vanities, Bretton Woods, Brexit referendum, British Empire, business cycle, butterfly effect, buy and hold, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, cellular automata, cognitive bias, cognitive dissonance, complexity theory, Corn Laws, corporate governance, creative destruction, Credit Default Swap, cuban missile crisis, currency manipulation / currency intervention, currency peg, currency risk, Daniel Kahneman / Amos Tversky, David Ricardo: comparative advantage, debt deflation, Deng Xiaoping, disintermediation, distributed ledger, diversification, diversified portfolio, driverless car, Edward Lorenz: Chaos theory, Eugene Fama: efficient market hypothesis, failed state, Fall of the Berlin Wall, fiat currency, financial repression, fixed income, Flash crash, floating exchange rates, forward guidance, Fractional reserve banking, G4S, George Akerlof, Glass-Steagall Act, global macro, global reserve currency, high net worth, Hyman Minsky, income inequality, information asymmetry, interest rate swap, Isaac Newton, jitney, John Meriwether, John von Neumann, Joseph Schumpeter, junk bonds, Kenneth Rogoff, labor-force participation, large denomination, liquidity trap, Long Term Capital Management, low interest rates, machine readable, mandelbrot fractal, margin call, market bubble, Mexican peso crisis / tequila crisis, Minsky moment, Money creation, money market fund, mutually assured destruction, Myron Scholes, Naomi Klein, nuclear winter, obamacare, offshore financial centre, operational security, Paul Samuelson, Peace of Westphalia, Phillips curve, Pierre-Simon Laplace, plutocrats, prediction markets, price anchoring, price stability, proprietary trading, public intellectual, quantitative easing, RAND corporation, random walk, reserve currency, RFID, risk free rate, risk-adjusted returns, Robert Solow, Ronald Reagan, Savings and loan crisis, Silicon Valley, sovereign wealth fund, special drawing rights, stock buybacks, stocks for the long run, tech billionaire, The Bell Curve by Richard Herrnstein and Charles Murray, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, theory of mind, Thomas Bayes, Thomas Kuhn: the structure of scientific revolutions, too big to fail, transfer pricing, value at risk, Washington Consensus, We are all Keynesians now, Westphalian system

On February 16, 2016, former secretary of the treasury Larry Summers: See Lawrence H. Summers, “It’s Time to Kill the $100 Bill,” The Washington Post, February 16, 2016, accessed August 7, 2016, www.washingtonpost.com/news/wonk/wp/2016/02/16/its-time-to-kill-the-100-bill/?postshare=8671455627637815&tid=ss_tw. On August 30, 2016, Kenneth Rogoff: Kenneth S. Rogoff, The Curse of Cash (Princeton, NJ: Princeton University Press, 2016). On November 10, 2014, the Financial Stability Board: See “Adequacy of Loss-Absorbing Capacity of Global Systemically Important Banks in Resolution,” Financial Stability Board, November 10, 2014. On May 3, 2016, the Federal Reserve: “Restrictions on Qualified Financial Contracts of Systemically Important U.S.

…

Existing €500 notes would still be legal tender, yet would be in short supply. This ban raised the possibility of buyers’ paying a premium in digital money, say €502, for available €500 notes. A premium purchase amounts to a negative interest rate on physical cash, a heretofore unheard-of result. On August 30, 2016, Kenneth Rogoff, Harvard professor and former chief economist of the IMF, published a manifesto called The Curse of Cash, an elite step-by-step plan to eliminate cash entirely. The war on cash and the rush to negative interest rates are advancing in lockstep, two sides of the same coin. Before cattle are led to slaughter, they are herded into pens so they can be easily controlled.

…

The Open Society and Its Enemies: Volume 2, The High Tide of Prophecy: Hegel, Marx, and the Aftermath. Princeton, NJ: Princeton University Press, 1971. Rappleye, Charles. Herbert Hoover in the White House: The Ordeal of the Presidency. New York: Simon & Schuster, 2016. Reinhart, Carmen M., and Kenneth S. Rogoff. This Time Is Different: Eight Centuries of Financial Folly. Princeton, NJ: Princeton University Press, 2009. Ricardo, David. The Principles of Political Economy and Taxation. Mineola, NY: Dover Publications, 2004. Rickards, James. Currency Wars: The Making of the Next Global Crisis. New York: Portfolio/Penguin, 2011. ———.

Stakeholder Capitalism: A Global Economy That Works for Progress, People and Planet by Klaus Schwab, Peter Vanham

"Friedman doctrine" OR "shareholder theory", "World Economic Forum" Davos, 3D printing, additive manufacturing, agricultural Revolution, air traffic controllers' union, Anthropocene, Apple II, Asian financial crisis, Asperger Syndrome, basic income, Berlin Wall, Big Tech, biodiversity loss, bitcoin, Black Lives Matter, blockchain, blue-collar work, Branko Milanovic, Bretton Woods, British Empire, business process, capital controls, Capital in the Twenty-First Century by Thomas Piketty, car-free, carbon footprint, carbon tax, centre right, clean tech, clean water, cloud computing, collateralized debt obligation, collective bargaining, colonial rule, company town, contact tracing, contact tracing app, Cornelius Vanderbilt, coronavirus, corporate governance, corporate social responsibility, COVID-19, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, cryptocurrency, cuban missile crisis, currency peg, cyber-physical system, decarbonisation, demographic dividend, Deng Xiaoping, Diane Coyle, digital divide, don't be evil, European colonialism, Fall of the Berlin Wall, family office, financial innovation, Francis Fukuyama: the end of history, future of work, gender pay gap, general purpose technology, George Floyd, gig economy, Gini coefficient, global supply chain, global value chain, global village, Google bus, green new deal, Greta Thunberg, high net worth, hiring and firing, housing crisis, income inequality, income per capita, independent contractor, industrial robot, intangible asset, Intergovernmental Panel on Climate Change (IPCC), Internet of things, invisible hand, James Watt: steam engine, Jeff Bezos, job automation, joint-stock company, Joseph Schumpeter, Kenneth Rogoff, Khan Academy, Kickstarter, labor-force participation, lockdown, low interest rates, low skilled workers, Lyft, manufacturing employment, Marc Benioff, Mark Zuckerberg, market fundamentalism, Marshall McLuhan, Martin Wolf, means of production, megacity, microplastics / micro fibres, Mikhail Gorbachev, mini-job, mittelstand, move fast and break things, neoliberal agenda, Network effects, new economy, open economy, Peace of Westphalia, Peter Thiel, precariat, Productivity paradox, profit maximization, purchasing power parity, race to the bottom, reserve currency, reshoring, ride hailing / ride sharing, Ronald Reagan, Salesforce, San Francisco homelessness, School Strike for Climate, self-driving car, seminal paper, shareholder value, Shenzhen special economic zone , Shenzhen was a fishing village, Silicon Valley, Simon Kuznets, social distancing, Social Responsibility of Business Is to Increase Its Profits, special economic zone, Steve Jobs, Steve Wozniak, synthetic biology, TaskRabbit, The Chicago School, The Future of Employment, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, the scientific method, TikTok, Tim Cook: Apple, trade route, transfer pricing, Uber and Lyft, uber lyft, union organizing, universal basic income, War on Poverty, We are the 99%, women in the workforce, working poor, working-age population, Yom Kippur War, young professional, zero-sum game

Marc Weiss, and Guang Yang, Global Urban Development, June 2004, http://www.globalurban.org/GUD%20Singapore%20MES%20Report.pdf. 29 “Singapore Faces Biggest Reskilling Challenge in Southeast Asia,” Justina Lee, Nikkei Asian Review, December 2018, https://asia.nikkei.com/Economy/Singapore-faces-biggest-reskilling-challenge-in-Southeast-Asia. 30 “PwC's Hopes and Fears Survey,” p. 4, PwC, September 2019, https://www.pwc.com/sg/en/publications/assets/new-world-new-skills-2020.pdf. 31 Interview with Tim Wu by Peter Vanham, New York, October 2019. 32 “The 100 Largest Companies by Market Capitalization in 2020,” Statista, consulted in October 2020, https://www.statista.com/statistics/263264/top-companies-in-the-world-by-market-capitalization. 33 Amazon’s Antitrust Paradox, Lina M. Kahn, The Yale Law Journal, January 2017 34 “Big Tech Has Too Much Monopoly Power—It's Right to Take It On,” Kenneth Rogoff, The Guardian, April 2019, https://www.theguardian.com/technology/2019/apr/02/big-tech-monopoly-power-elizabeth-warren-technology; Quote: “Here are titles of some recent articles: Paul Krugman's “Monopoly Capitalism Is Killing US Economy,” Joseph Stiglitz's “America Has a Monopoly Problem—and It's Huge,” and Kenneth Rogoff's “Big Tech Is a Big Problem”; “The Rise of Corporate Monopoly Power,” Zia Qureshi, Brookings, May 2019, https://www.brookings.edu/blog/up-front/2019/05/21/the-rise-of-corporate-market-power/. 35 “Steve Wozniak Says Apple Should've Split Up a Long Time Ago, Big Tech Is Too Big,” Bloomberg, August 2019, https://www.bloomberg.com/news/videos/2019-08-27/steve-wozniak-says-apple-should-ve-split-up-a-long-time-ago-big-tech-is-too-big-video. 36 Some scholars do dispute this notion.

…

When I visited US Senator Elizabeth Warren in Washington, DC, at the end of 2018, she was already contemplating a similar stance against the market leaders in many of America's industries, including technology, the pharmaceutical sector, and finance. Wu's colleague at Columbia Law School Lina Khan in 2016 wrote a seminal paper (while at Yale), taking a similar stance: “Amazon's Antitrust Paradox.”33 Economists such as Gabriel Zucman, Emmanuel Saez, Kenneth Rogoff, and Nobel Prize winners Paul Krugman and Joseph Stiglitz have also stated Big Tech has “too much power”34 or needs to be more strictly regulated. Leading journalists including Nicholas Thompson, the editor in chief of Wired, and Rana Foroohar, associate editor of the Financial Times, favor antitrust action against Big Tech too.

Stakeholder Capitalism: A Global Economy That Works for Progress, People and Planet by Klaus Schwab

"Friedman doctrine" OR "shareholder theory", "World Economic Forum" Davos, 3D printing, additive manufacturing, agricultural Revolution, air traffic controllers' union, Anthropocene, Apple II, Asian financial crisis, Asperger Syndrome, basic income, Berlin Wall, Big Tech, biodiversity loss, bitcoin, Black Lives Matter, blockchain, blue-collar work, Branko Milanovic, Bretton Woods, British Empire, business process, capital controls, Capital in the Twenty-First Century by Thomas Piketty, car-free, carbon footprint, carbon tax, centre right, clean tech, clean water, cloud computing, collateralized debt obligation, collective bargaining, colonial rule, company town, contact tracing, contact tracing app, Cornelius Vanderbilt, coronavirus, corporate governance, corporate social responsibility, COVID-19, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, cryptocurrency, cuban missile crisis, currency peg, cyber-physical system, decarbonisation, demographic dividend, Deng Xiaoping, Diane Coyle, digital divide, don't be evil, European colonialism, Fall of the Berlin Wall, family office, financial innovation, Francis Fukuyama: the end of history, future of work, gender pay gap, general purpose technology, George Floyd, gig economy, Gini coefficient, global supply chain, global value chain, global village, Google bus, green new deal, Greta Thunberg, high net worth, hiring and firing, housing crisis, income inequality, income per capita, independent contractor, industrial robot, intangible asset, Intergovernmental Panel on Climate Change (IPCC), Internet of things, invisible hand, James Watt: steam engine, Jeff Bezos, job automation, joint-stock company, Joseph Schumpeter, Kenneth Rogoff, Khan Academy, Kickstarter, labor-force participation, lockdown, low interest rates, low skilled workers, Lyft, manufacturing employment, Marc Benioff, Mark Zuckerberg, market fundamentalism, Marshall McLuhan, Martin Wolf, means of production, megacity, microplastics / micro fibres, Mikhail Gorbachev, mini-job, mittelstand, move fast and break things, neoliberal agenda, Network effects, new economy, open economy, Peace of Westphalia, Peter Thiel, precariat, Productivity paradox, profit maximization, purchasing power parity, race to the bottom, reserve currency, reshoring, ride hailing / ride sharing, Ronald Reagan, Salesforce, San Francisco homelessness, School Strike for Climate, self-driving car, seminal paper, shareholder value, Shenzhen special economic zone , Shenzhen was a fishing village, Silicon Valley, Simon Kuznets, social distancing, Social Responsibility of Business Is to Increase Its Profits, special economic zone, Steve Jobs, Steve Wozniak, synthetic biology, TaskRabbit, The Chicago School, The Future of Employment, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, the scientific method, TikTok, Tim Cook: Apple, trade route, transfer pricing, Uber and Lyft, uber lyft, union organizing, universal basic income, War on Poverty, We are the 99%, women in the workforce, working poor, working-age population, Yom Kippur War, young professional, zero-sum game

Marc Weiss, and Guang Yang, Global Urban Development, June 2004, http://www.globalurban.org/GUD%20Singapore%20MES%20Report.pdf. 29 “Singapore Faces Biggest Reskilling Challenge in Southeast Asia,” Justina Lee, Nikkei Asian Review, December 2018, https://asia.nikkei.com/Economy/Singapore-faces-biggest-reskilling-challenge-in-Southeast-Asia. 30 “PwC's Hopes and Fears Survey,” p. 4, PwC, September 2019, https://www.pwc.com/sg/en/publications/assets/new-world-new-skills-2020.pdf. 31 Interview with Tim Wu by Peter Vanham, New York, October 2019. 32 “The 100 Largest Companies by Market Capitalization in 2020,” Statista, consulted in October 2020, https://www.statista.com/statistics/263264/top-companies-in-the-world-by-market-capitalization. 33 Amazon’s Antitrust Paradox, Lina M. Kahn, The Yale Law Journal, January 2017 34 “Big Tech Has Too Much Monopoly Power—It's Right to Take It On,” Kenneth Rogoff, The Guardian, April 2019, https://www.theguardian.com/technology/2019/apr/02/big-tech-monopoly-power-elizabeth-warren-technology; Quote: “Here are titles of some recent articles: Paul Krugman's “Monopoly Capitalism Is Killing US Economy,” Joseph Stiglitz's “America Has a Monopoly Problem—and It's Huge,” and Kenneth Rogoff's “Big Tech Is a Big Problem”; “The Rise of Corporate Monopoly Power,” Zia Qureshi, Brookings, May 2019, https://www.brookings.edu/blog/up-front/2019/05/21/the-rise-of-corporate-market-power/. 35 “Steve Wozniak Says Apple Should've Split Up a Long Time Ago, Big Tech Is Too Big,” Bloomberg, August 2019, https://www.bloomberg.com/news/videos/2019-08-27/steve-wozniak-says-apple-should-ve-split-up-a-long-time-ago-big-tech-is-too-big-video. 36 Some scholars do dispute this notion.

…

When I visited US Senator Elizabeth Warren in Washington, DC, at the end of 2018, she was already contemplating a similar stance against the market leaders in many of America's industries, including technology, the pharmaceutical sector, and finance. Wu's colleague at Columbia Law School Lina Khan in 2016 wrote a seminal paper (while at Yale), taking a similar stance: “Amazon's Antitrust Paradox.”33 Economists such as Gabriel Zucman, Emmanuel Saez, Kenneth Rogoff, and Nobel Prize winners Paul Krugman and Joseph Stiglitz have also stated Big Tech has “too much power”34 or needs to be more strictly regulated. Leading journalists including Nicholas Thompson, the editor in chief of Wired, and Rana Foroohar, associate editor of the Financial Times, favor antitrust action against Big Tech too.

The Death of Money: The Coming Collapse of the International Monetary System by James Rickards

"World Economic Forum" Davos, Affordable Care Act / Obamacare, Alan Greenspan, Asian financial crisis, asset allocation, Ayatollah Khomeini, bank run, banking crisis, Bear Stearns, Ben Bernanke: helicopter money, bitcoin, Black Monday: stock market crash in 1987, Black Swan, Boeing 747, Bretton Woods, BRICs, business climate, business cycle, buy and hold, capital controls, Carmen Reinhart, central bank independence, centre right, collateralized debt obligation, collective bargaining, complexity theory, computer age, credit crunch, currency peg, David Graeber, debt deflation, Deng Xiaoping, diversification, Dr. Strangelove, Edward Snowden, eurozone crisis, fiat currency, financial engineering, financial innovation, financial intermediation, financial repression, fixed income, Flash crash, floating exchange rates, forward guidance, G4S, George Akerlof, global macro, global reserve currency, global supply chain, Goodhart's law, Growth in a Time of Debt, guns versus butter model, Herman Kahn, high-speed rail, income inequality, inflation targeting, information asymmetry, invisible hand, jitney, John Meriwether, junk bonds, Kenneth Rogoff, labor-force participation, Lao Tzu, liquidationism / Banker’s doctrine / the Treasury view, liquidity trap, Long Term Capital Management, low interest rates, mandelbrot fractal, margin call, market bubble, market clearing, market design, megaproject, Modern Monetary Theory, Money creation, money market fund, money: store of value / unit of account / medium of exchange, mutually assured destruction, Nixon triggered the end of the Bretton Woods system, obamacare, offshore financial centre, oil shale / tar sands, open economy, operational security, plutocrats, Ponzi scheme, power law, price stability, public intellectual, quantitative easing, RAND corporation, reserve currency, risk-adjusted returns, Rod Stewart played at Stephen Schwarzman birthday party, Ronald Reagan, Satoshi Nakamoto, Silicon Valley, Silicon Valley startup, Skype, Solyndra, sovereign wealth fund, special drawing rights, Stuxnet, The Market for Lemons, Thomas Kuhn: the structure of scientific revolutions, Thomas L Friedman, too big to fail, trade route, undersea cable, uranium enrichment, Washington Consensus, working-age population, yield curve

Plugging these actual numbers into the PDS framework results in: (2.5 + 1) – 1.5 < 4, or 2 < 4 In this example, real growth plus inflation minus interest expense is less than the primary deficit, which means that debt as a percentage of GDP is increasing. This is the unsustainable condition. Again, what matters in this model is not the level but the trend, as played out in the dynamics of the BRITS and their interactions. Contrary to the oft-cited Carmen Reinhart and Kenneth Rogoff thesis, the absolute level of debt to GDP is not what triggers a crisis; it is the trend toward unsustainability. One beauty of PDS is that the math is simple. Starting with the identity as 2 < 4 means that to achieve sustainability, either the 2 must go up, the 4 must go down, or both. Real growth in the United States today is stuck at 2.5 percent, partly due to policy uncertainty.

…

CHAPTER 10 CROSSROADS I’m the fellow who takes away the punch bowl just when the party is getting good. William McChesney Martin Jr. Chairman of the Federal Reserve Board, 1951–70 The trouble is that this is no ordinary recession, and a lot of people have not had any punch yet. Kenneth Rogoff June 6, 2013 Developed countries have no reason to default. They can always print money. George Soros April 9, 2013 ■ The Inflation-Deflation Paradox Federal Reserve policy is at a crossroads facing unpleasant paths in all directions. Monetary policy around the world has reached the point where the contradictions embedded in years of market manipulation have left no choices that do not involve either contraction or catastrophic risk.

…

the relationship of U.S. debt and deficits . . . : John H. Makin, “Trillion-Dollar Deficits Are Sustainable for Now, Unfortunately,” American Enterprise Institute, December 13, 2012, http://www.aei.org/outloook/trillion-dollar-deficits-are-sustainable-for-now-unfortunately. Contrary to the oft-cited . . . : Carmen M. Reinhart and Kenneth S. Rogoff, “Growth in a Time of Debt,” National Bureau of Economic Research, Working Paper no. 15639, January 2010, http://www.nber.org/papers/w15639. “The Liquidation of Government Debt”: Carmen M. Reinhart and M. Belen Sbrancia, “The Liquidation of Government Debt,” National Bureau of Economic Research, Working Paper no. 16893, March 2011, http://www.nber.org/papers/w16893.

EuroTragedy: A Drama in Nine Acts by Ashoka Mody

Alan Greenspan, Andrei Shleifer, asset-backed security, availability heuristic, bank run, banking crisis, Basel III, Bear Stearns, Berlin Wall, book scanning, book value, Bretton Woods, Brexit referendum, call centre, capital controls, Carmen Reinhart, Celtic Tiger, central bank independence, centre right, credit crunch, currency risk, Daniel Kahneman / Amos Tversky, debt deflation, Donald Trump, eurozone crisis, Fall of the Berlin Wall, fear index, financial intermediation, floating exchange rates, forward guidance, George Akerlof, German hyperinflation, global macro, global supply chain, global value chain, hiring and firing, Home mortgage interest deduction, income inequality, inflation targeting, Irish property bubble, Isaac Newton, job automation, Johann Wolfgang von Goethe, Johannes Kepler, Kenneth Rogoff, Kickstarter, land bank, liberal capitalism, light touch regulation, liquidity trap, loadsamoney, London Interbank Offered Rate, Long Term Capital Management, low interest rates, low-wage service sector, Mikhail Gorbachev, mittelstand, money market fund, moral hazard, mortgage tax deduction, neoliberal agenda, offshore financial centre, oil shock, open borders, pension reform, precautionary principle, premature optimization, price stability, public intellectual, purchasing power parity, quantitative easing, rent-seeking, Republic of Letters, Robert Gordon, Robert Shiller, Robert Solow, short selling, Silicon Valley, subprime mortgage crisis, The Great Moderation, The Rise and Fall of American Growth, too big to fail, total factor productivity, trade liberalization, transaction costs, urban renewal, working-age population, Yogi Berra

Sweden and the United Kingdom, having consciously stayed out of the eurozone, had also achieved irrational exuberance 173 low inflation rates. Even Poland, much poorer than euro-​area countries and hence more likely to experience bursts of inflation, had contained its inflation to near the euro-​area average. Indeed, inflation had rapidly come down throughout the world. As Kenneth Rogoff, then the IMF’s chief economist and director of its research department, explained, competition from Chinese and other Asian exporters had “put downward pressure” on prices.78 Inflation had come down everywhere, in large part because cheap Chinese manufactured goods were keeping a lid on prices.

…

Another Princeton economist, Christopher Sims, spoke next, and he had the same message: “Opening up capital markets in poor countries has often led initially to large inflows and later to financial problems.”137 Sims also warned of the risk of sovereign defaults. In August 2003, economists Carmen Reinhart and Kenneth Rogoff noted that Greece and Portugal belonged to the small club of “serial defaulters.”138 Both had defaulted on external creditors multiple times in the nineteenth century. Rogoff was still the IMF’s chief economist and Reinhart was one of his deputies. Together with their colleague, Miguel Savastano, they reported that serial defaulters had “weak fiscal structures and weak financial systems,” which persisted for years.

…

Bailout” Paulson, feeling political heat, decided that this was the time to stand firm against rescuing Lehman.92 Without Bear Stearns-style protection for its creditors, there was no buyer for Lehman. On September 15, Lehman Brothers filed for bankruptcy. Stock prices declined. The stress in the interbank market rose. Kenneth Rogoff—​Harvard University economics professor, former chief economist of the IMF, and a man who had dropped out of high school to become a chess grand master—​was prominent among commentators who welcomed the decision to let Lehman fall. In an op-​ed piece for the Washington Post on September 16, Rogoff’s theme was “The Government is willing to let Wall Street firms fail.

The Only Game in Town: Central Banks, Instability, and Avoiding the Next Collapse by Mohamed A. El-Erian

"World Economic Forum" Davos, activist fund / activist shareholder / activist investor, Airbnb, Alan Greenspan, balance sheet recession, bank run, barriers to entry, Bear Stearns, behavioural economics, Black Monday: stock market crash in 1987, break the buck, Bretton Woods, British Empire, business cycle, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, carried interest, collapse of Lehman Brothers, corporate governance, currency peg, disruptive innovation, driverless car, Erik Brynjolfsson, eurozone crisis, fear index, financial engineering, financial innovation, Financial Instability Hypothesis, financial intermediation, financial repression, fixed income, Flash crash, forward guidance, friendly fire, full employment, future of work, geopolitical risk, Hyman Minsky, If something cannot go on forever, it will stop - Herbert Stein's Law, income inequality, inflation targeting, Jeff Bezos, Kenneth Rogoff, Khan Academy, liquidity trap, low interest rates, Martin Wolf, megacity, Mexican peso crisis / tequila crisis, moral hazard, mortgage debt, Norman Mailer, oil shale / tar sands, price stability, principal–agent problem, quantitative easing, risk tolerance, risk-adjusted returns, risk/return, Second Machine Age, secular stagnation, sharing economy, Sheryl Sandberg, sovereign wealth fund, The Great Moderation, The Wisdom of Crowds, too big to fail, University of East Anglia, yield curve, zero-sum game

The good news from this book is that if policymakers get their act together, things could be a lot better. The bad news is that this seasoned and influential veteran isn’t at all sure this will happen. The Only Game in Town is simply a must-read for anyone trying to understand how the global economy might unfold in the next five years.” —Kenneth Rogoff, Thomas D. Cabot Professor of Public Policy at Harvard University, and former chief economist and director of research at the International Monetary Fund “In his next book, The Only Game in Town, Mohamed El-Erian has done several important things superbly. First, he has presented the first really comprehensive assessment of the multiple challenges to sustainable and inclusive growth facing a wide range of countries and the global economy.

…

They avoided talking about debt reduction despite the fact that their emergency liquidity support to highly indebted countries was associated with growth rates that consistently undershot their own expectations and projections. And they underestimated the societal and political implications of a prolonged period of economic underperformance and financial insecurity. The harmful consequences have been material. As Carmen Reinhart and Kenneth Rogoff have noted, because the advanced economies have not been able to also use other options, such as debt restructuring and conversions, which were used in the 1930s, they have been undermined by a “forgotten lesson.”6 It is high time to change this. 4. GETTING THE ARCHITECTURE RIGHT (OR, AT LEAST, LESS WRONG) A.

…

., June 2014, http://www.imf.org/external/np/pp/eng/2014/052214a.pdf. 5. See, for example, “Debt Relief Under the Heavily Indebted Poor Countries (HIPC) Initiative,” IMF Factsheet, Washington, D.C., September 2014, https://www.imf.org/external/np/exr/facts/hipc.htm. 6. Carmen M. Reinhart and Kenneth S. Rogoff, “Financial and Sovereign Debt Crises: Some Lessons Learned and Those Forgotten,” IMF Working Paper, WP/13/266, December 2013, https://www.imf.org/external/pubs/ft/wp/2013/wp13266.pdf. 7. “Bleak Words and Difficult Homework from the IMF,” Financial Times, October 5, 2014, http://www.ft.com/intl/cms/s/0/53516aec-4af6-11e4-b1be-00144feab7de.html. 8.

The Globalization Paradox: Democracy and the Future of the World Economy by Dani Rodrik

"World Economic Forum" Davos, affirmative action, Alan Greenspan, Asian financial crisis, bank run, banking crisis, Bear Stearns, bilateral investment treaty, borderless world, Bretton Woods, British Empire, business cycle, capital controls, Carmen Reinhart, central bank independence, classic study, collective bargaining, colonial rule, Corn Laws, corporate governance, corporate social responsibility, credit crunch, Credit Default Swap, currency manipulation / currency intervention, David Ricardo: comparative advantage, deindustrialization, Deng Xiaoping, Doha Development Round, en.wikipedia.org, endogenous growth, eurozone crisis, export processing zone, financial deregulation, financial innovation, floating exchange rates, frictionless, frictionless market, full employment, George Akerlof, guest worker program, Hernando de Soto, immigration reform, income inequality, income per capita, industrial cluster, information asymmetry, joint-stock company, Kenneth Rogoff, land reform, liberal capitalism, light touch regulation, Long Term Capital Management, low interest rates, low skilled workers, margin call, market bubble, market fundamentalism, Martin Wolf, mass immigration, Mexican peso crisis / tequila crisis, microcredit, Monroe Doctrine, moral hazard, Multi Fibre Arrangement, night-watchman state, non-tariff barriers, offshore financial centre, oil shock, open borders, open economy, Paul Samuelson, precautionary principle, price stability, profit maximization, race to the bottom, regulatory arbitrage, Savings and loan crisis, savings glut, Silicon Valley, special drawing rights, special economic zone, subprime mortgage crisis, The Wealth of Nations by Adam Smith, Thomas L Friedman, Tobin tax, too big to fail, trade liberalization, trade route, transaction costs, tulip mania, Washington Consensus, World Values Survey

Similarly, a paper I wrote calling into question the widely held view that freer trade has promoted growth around the world was published in a publication of the National Bureau of Economic Research, the premier network for applied economists—Francisco Rodriguez and Dani Rodrik, “Trade Policy and Economic Growth: A Skeptic’s Guide to the Cross-National Evidence” in Ben Bernanke and Kenneth S. Rogoff, eds., Macroeconomics Annual 2000 (Cambridge, MA: MIT Press for NBER, 2001). 20 Driskill, “Deconstructing the Argument for Free Trade,” p. 6. 21 Ibid., p. 2. 4. Bretton Woods, GATT, and the WTO 1 John Maynard Keynes, “National Self-Sufficiency,” The Yale Review, vol. 22, no. 4 (June 1933), pp. 755–69.

…

Calvo, “Explaining Sudden Stops, Growth Collapse and BOP Crises: The Case of Distortionary Output Taxes,” in his Emerging Capital Markets in Turmoil: Bad Luck or Bad Policy? (Cambridge, MA: MIT Press, 2005). 30 Laeven and Fabian, “Systemic Bank Crises,” p. 25. 31 Charles P. Kindleberger, Manias, Panics and Crashes: A History of Financial Crises (New York: Basic Books, 1989). 32 Carmen M. Reinhart and Kenneth S. Rogoff, “This Time Is Different: A Panoramic View of Eight Centuries of Financial Crises,” Unpublished paper, Harvard University, April 16, 2008, p. 7 (http://www.economics.harvard.edu/faculty/ rogoff/files/This_Time_Is_Different.pdf). 33 Research at the IMF has shown that the volatility of consumption in the developing economies rose under financial globalization—M.

…

Norton, 2002). 13 Jagdish Bhagwati, “The Capital Myth: The Difference Between Trade in Widgets and Dollars,” Foreign Affairs, vol. 77, no. 3 (May–June 1998), pp. 7–12. 14 Jagdish Bhagwati, In Defense of Globalization (New York: Oxford University Press, 2004), p. 239. 15 M. Ayhan Kose, Eswar Prasad, Kenneth Rogoff, and Shang-Jin Wei, “Financial Globalization: A Reappraisal,” IMF Staff Papers, vol. 56, no. 1 (April 2009), pp. 8–62. 16 Louise Story, Landon Thomas, Jr., and Nelson D. Schwartz, “Wall St. Helped to Mask Debt Fueling Europe’s Crisis,” New York Times, February 13, 2010 (http://www.nytimes.com/2010/02/14/ business/global/14debt.html?

The Butterfly Defect: How Globalization Creates Systemic Risks, and What to Do About It by Ian Goldin, Mike Mariathasan

air freight, air traffic controllers' union, Andrei Shleifer, Asian financial crisis, asset-backed security, bank run, barriers to entry, Basel III, Bear Stearns, behavioural economics, Berlin Wall, biodiversity loss, Bretton Woods, BRICs, business cycle, butterfly effect, carbon tax, clean water, collapse of Lehman Brothers, collateralized debt obligation, complexity theory, connected car, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, David Ricardo: comparative advantage, deglobalization, Deng Xiaoping, digital divide, discovery of penicillin, diversification, diversified portfolio, Douglas Engelbart, Douglas Engelbart, Edward Lorenz: Chaos theory, energy security, eurozone crisis, Eyjafjallajökull, failed state, Fairchild Semiconductor, Fellow of the Royal Society, financial deregulation, financial innovation, financial intermediation, fixed income, Gini coefficient, Glass-Steagall Act, global pandemic, global supply chain, global value chain, global village, high-speed rail, income inequality, information asymmetry, Jean Tirole, John Snow's cholera map, Kenneth Rogoff, light touch regulation, Long Term Capital Management, market bubble, mass immigration, megacity, moral hazard, Occupy movement, offshore financial centre, open economy, precautionary principle, profit maximization, purchasing power parity, race to the bottom, RAND corporation, regulatory arbitrage, reshoring, risk free rate, Robert Solow, scientific management, Silicon Valley, six sigma, social contagion, social distancing, Stuxnet, supply-chain management, systems thinking, tail risk, TED Talk, The Great Moderation, too big to fail, Toyota Production System, trade liberalization, Tragedy of the Commons, transaction costs, uranium enrichment, vertical integration

Nestor A. Espenilla Jr., 2009, “Regulatory Factors That Contributed to the Global Financial Crisis,” Asia-Pacific Social Science Review 9 (1): 35–40. 40. James H. Stock and Mark W. Watson, 2002. “Has the Business Cycle Changed and Why?,” in NBER Macroeconomics Annual, vol. 17, ed. Mark Gertler and Kenneth Rogoff (Cambridge, MA: MIT Press), 159–218. 41. Andrew G. Haldane, 2009, “Rethinking the Financial Network,” speech delivered to the Amsterdam Student Association, April, accessed 21 January 2013, http://www.bankofengland.co.uk/archive/Documents/historicpubs/speeches/2009/speech386.pdf. 42. Authors’ calculation based on data from Lucinda Maer and Nida Broughton, 2012, “Financial Services: Contribution to the UK Economy,” SN/EP/06193, House of Commons Library (Economics, Politics, and Statistics Section), p. 3, table 1, accessed 22 January 2013, http://www.parliament.uk/briefing-papers/SN06193.pdf. 43.

…

Global Study Magazine 4 (3): 36–49. Pongsiri, Monitira J., Joe Roman, Vanessa O. Ezenwa, Tony L. Goldberg, Hillel S. Koren, Stephen C. Newbold, Richard S. Ostfeld, Subhrendu K. Pattanayak, and Daniel J. Salkeld. 2009. “Biodiversity Loss Affects Global Disease Ecology.” BioScience 59 (11): 945–954. Prasad, Eswar S., Kenneth Rogoff, Shang-Jin Wei, and M. Ayan Kose. 2003. “Effects of Financial Globalization on Developing Countries: Some Empirical Evidence.” IMF Occasional Paper 220. International Monetary Fund, Washington, DC. Pritchett, Lant. 1997. “Convergence, Big Time.” Journal of Economic Perspectives 11 (3): 3–17.

…

London: Vintage. Stiglitz, Jospeh E. 2006. Making Globalization Work. London: W. W. Norton. ———. 2012. The Price of Inequality. London: Allen Lane. Stock, James H., and Mark W. Watson. 2002. “Has the Business Cycle Changed and Why?” In NBER Macroeconomics Annual, vol. 17, ed. Mark Gertler and Kenneth Rogoff. Cambridge, MA: MIT Press, 159–218. Strasburg, Jenny, and Jacob Bunge. 2012. “Loss Swamps Trading Firm: Knight Capital Searches for Partner as Tab for Computer Glitch Hits $440 Million.” Wall Street Journal, 2 August. Accessed 21 January 2013. http://online.wsj.com/article/SB10000872396390443866404577564772083961412.html.

Prosperity Without Growth: Foundations for the Economy of Tomorrow by Tim Jackson

"World Economic Forum" Davos, Alan Greenspan, bank run, banking crisis, banks create money, Basel III, basic income, biodiversity loss, bonus culture, Boris Johnson, business cycle, carbon footprint, Carmen Reinhart, Cass Sunstein, choice architecture, circular economy, collapse of Lehman Brothers, creative destruction, credit crunch, Credit Default Swap, critique of consumerism, David Graeber, decarbonisation, degrowth, dematerialisation, en.wikipedia.org, energy security, financial deregulation, Financial Instability Hypothesis, financial intermediation, full employment, Garrett Hardin, Glass-Steagall Act, green new deal, Growth in a Time of Debt, Hans Rosling, Hyman Minsky, impact investing, income inequality, income per capita, intentional community, Intergovernmental Panel on Climate Change (IPCC), Internet of things, invisible hand, job satisfaction, John Maynard Keynes: Economic Possibilities for our Grandchildren, Joseph Schumpeter, Kenneth Rogoff, Kickstarter, laissez-faire capitalism, liberal capitalism, low interest rates, Mahatma Gandhi, mass immigration, means of production, meta-analysis, Money creation, moral hazard, mortgage debt, Murray Bookchin, Naomi Klein, negative emissions, new economy, ocean acidification, offshore financial centre, oil shale / tar sands, open economy, paradox of thrift, peak oil, peer-to-peer lending, Philip Mirowski, Post-Keynesian economics, profit motive, purchasing power parity, quantitative easing, retail therapy, Richard Thaler, road to serfdom, Robert Gordon, Robert Solow, Ronald Reagan, science of happiness, secular stagnation, short selling, Simon Kuznets, Skype, smart grid, sovereign wealth fund, Steve Jobs, TED Talk, The Chicago School, The Great Moderation, The Rise and Fall of American Growth, The Spirit Level, The Theory of the Leisure Class by Thorstein Veblen, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, Tragedy of the Commons, universal basic income, Works Progress Administration, World Values Survey, zero-sum game

Online at www.oxfam.org/sites/www.oxfam.org/files/file_attachments/dp-a-safe-and-just-space-for-humanity-130212-en_5.pdf (accessed 30 March 2016). Reay, David, Colin Ramshaw and Adam Harvey 2008. Process Intensification: Engineering for Efficiency, Sustainability and Flexibility. Oxford: Butterworth-Heinemann. Reinhart, Carmen and Kenneth Rogoff 2013. ‘Financial and sovereign debt crises: some lessons learned and those forgotten’. IMF Working Paper WP/13/266. Washington, DC: International Monetary Fund. Reinhart, Carmen and Kenneth Rogoff 2010. ‘Growth in a time of debt’. American Economic Review: Papers and Proceedings 100: 573–578. Ridley, Matt 1996. The Origins of Virtue. London: Penguin Books. Ridley, Matt 1994. The Red Queen – Sex and the Evolution of Human Nature.

…

Rogelj, Joeri, Michiel Schaeffer, Pierre Friedlingstein, Nathan Gillett, Detlef van Vuuren, Keywan Riahi et al. 2016. ‘Differences between carbon budget estimates unravelled’. Nature Climate Change 6: 245–252. doi:10.1038/nclimate2868. Rogoff, Kenneth 2015. ‘Oil prices and global growth. Project syndicate’. Online at www.project-syndicate.org/commentary/oil-prices-global-growth-by-kenneth-rogoff-2015-12?utm_source=Project+Syndicate+Newsletter&utm_campaign=c9ff3f432f-Rogoff_Oil_Prices_and_Global_Growth_12_20_2015&utm_medium=email&utm_term=0_73bad5b7d8-c9ff3f432f-104293997 (accessed 18 December 2015). Rose, Hilary and Stephen Rose 2000. Alas, Poor Darwin – Arguments Against Evolutionary Psychology.

Them And Us: Politics, Greed And Inequality - Why We Need A Fair Society by Will Hutton

Abraham Maslow, Alan Greenspan, Andrei Shleifer, asset-backed security, bank run, banking crisis, Bear Stearns, behavioural economics, Benoit Mandelbrot, Berlin Wall, Bernie Madoff, Big bang: deregulation of the City of London, Blythe Masters, Boris Johnson, bread and circuses, Bretton Woods, business cycle, capital controls, carbon footprint, Carmen Reinhart, Cass Sunstein, centre right, choice architecture, cloud computing, collective bargaining, conceptual framework, Corn Laws, Cornelius Vanderbilt, corporate governance, creative destruction, credit crunch, Credit Default Swap, debt deflation, decarbonisation, Deng Xiaoping, discovery of DNA, discovery of the americas, discrete time, disinformation, diversification, double helix, Edward Glaeser, financial deregulation, financial engineering, financial innovation, financial intermediation, first-past-the-post, floating exchange rates, Francis Fukuyama: the end of history, Frank Levy and Richard Murnane: The New Division of Labor, full employment, general purpose technology, George Akerlof, Gini coefficient, Glass-Steagall Act, global supply chain, Growth in a Time of Debt, Hyman Minsky, I think there is a world market for maybe five computers, income inequality, inflation targeting, interest rate swap, invisible hand, Isaac Newton, James Dyson, James Watt: steam engine, Japanese asset price bubble, joint-stock company, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, knowledge worker, labour market flexibility, language acquisition, Large Hadron Collider, liberal capitalism, light touch regulation, Long Term Capital Management, long term incentive plan, Louis Pasteur, low cost airline, low interest rates, low-wage service sector, mandelbrot fractal, margin call, market fundamentalism, Martin Wolf, mass immigration, means of production, meritocracy, Mikhail Gorbachev, millennium bug, Money creation, money market fund, moral hazard, moral panic, mortgage debt, Myron Scholes, Neil Kinnock, new economy, Northern Rock, offshore financial centre, open economy, plutocrats, power law, price discrimination, private sector deleveraging, proprietary trading, purchasing power parity, quantitative easing, race to the bottom, railway mania, random walk, rent-seeking, reserve currency, Richard Thaler, Right to Buy, rising living standards, Robert Shiller, Ronald Reagan, Rory Sutherland, Satyajit Das, Savings and loan crisis, shareholder value, short selling, Silicon Valley, Skype, South Sea Bubble, Steve Jobs, systems thinking, tail risk, The Market for Lemons, the market place, The Myth of the Rational Market, the payments system, the scientific method, The Wealth of Nations by Adam Smith, three-masted sailing ship, too big to fail, unpaid internship, value at risk, Vilfredo Pareto, Washington Consensus, wealth creators, work culture , working poor, world market for maybe five computers, zero-sum game, éminence grise

Equally problematic is determining a sustainable level of public debt, which is certain to rise to maintain economic activity in almost every country as private debt starts to fall. Most countries can handle public debt up to 90 per cent of GDP; above that level, the ratio of debt service to any reasonable level of tax receipts as a share of GDP starts to nudge above 10 per cent, which causes problems for most states over time. Carmen Reinhart and Kenneth Rogoff say that once ratios of public debt to GDP exceed 90 per cent, median growth rates fall by 1 per cent a year, but there is no association between growth and public debt below 90 per cent.5 Indeed, if rising public debt is associated with an increase in capital investment, it can even stimulate growth rates.

…

See also Julia Jones, Piyamas Nanork and Benjamin Oldroyd (2007) ‘The Role of Genetic Diversity in Nest Cooling in a Wild Honey Bee, Apis florea’, Journal of Comparative Physiology a-Neuroethology Sensory Neural and Behavioral Physiology 193 (2): 159–65. 55 Dean Amel, Colleen Barnes, Fabio Panetta and Carmelo Salleo (2004) ‘Consolidation and Efficiency in the Financial Sector: A Review of the International Evidence’, Journal of Banking and Finance 28: 2493–519. 56 ACT Response to the Turner Review of Banking Regulation, at http://www.treasurers.org/reviewbankingregulation/actresponse/0609. 57 Peter Boone and Simon Johnson, ‘Bernanke on Banking’, Economix, 19 October 2009, at http://economix.blogs.nytimes.com/2009/10/29/bernankeon-banking/. 58 Manmohan Singh (2010) ‘Collateral, Netting and Systemic Risk in the OTC Derivatives Market’, IMF Working Paper No. 10/99. 59 Michael Lewis (2010) The Big Short: Inside the Doomsday Machine, Allen Lane. Chapter Eight: The £5 Trillion Mistake 1 Carmen Reinhart and Kenneth Rogoff (2010) This Time is Different, Princeton University Press. 2 HM Treasury (2009) Pre-Budget Report 2009: Securing the Recovery: Growth and Opportunity, HMSO. See also Martin Wolf, ‘Britain’s Dismal Choice: Sharing the Losses’, Financial Times, 15 December 2009, at http://www.ft.com/cms/s/0/f693b6a4-e9af-11de-9f1f-00144feab49a,s01=1.html. 3 OECD (2009) OECD Factbook, OECD, with Treasury figures and estimates for 2008 and 2009. 4 Robert Chote, Carl Emmerson and Jonathan Shaw (eds) (2010) The Institute for Fiscal Studies Green Budget, IFS. 5 Francesco Guerrera, ‘Welch Denounces Corporate Obsessions’, Financial Times, 13 March 2009, at http://www.ft.com/cms/s/0/3ca8ec2e-0f70-11de-ba10-0000779fd2ac.html. 6 Max Hastings, ‘The End of Britain’s Long Weekend’, Financial Times, 20 December 2009, at http://www.ft.com/cms/s/0/1e9f7cdc-ed8e-11de-ba12-00144feab49a.html. 7 Internal Cabinet Office analysis. 8 Chris Giles, ‘Manufacturing Fades under Labour’, Financial Times, 2 December 2009, at http://www.ft.com/cms/s/0/f32a3392-df7a-11de-98ca-00144feab49a.html. 9 Leonard Trelawny Hobhouse (1911) Liberalism, at socserv.mcmaster.ca/econ/ugcm/3ll3/hobhouse/liberalism.pdf. 10 Buffett, Gates and Simon are all cited in Gar Alperovitz and Lew Daly (2008) Unjust Deserts: How the Rich Are Taking Our Common Inheritance and Why We Should Take It Back, The New Press. 11 Antonio Afonso, Ludger Schuknecht and Vito Tanzi (2005) ‘Public Sector Efficiency: An International Comparison’, Public Choice 123 (3–4): 321–47.

…

Portsmouth’s predicament compares starkly with the current approach favoured by its south-coast neighbours, Southampton, of building up the side over time. 3 Margot Finn (2003) The Character of Credit: Personal Debt in English Culture, 1740–1914, Cambridge University Press. 4 McKinsey Global Institute (2010) ‘Debt and Deleveraging: The Global Credit Bubble and its Economic Consequences’, report. 5 Carmen Reinhart and Kenneth Rogoff (forthcoming) ‘Growth in a Time of Debt’, prepared for the American Economic Review Papers and Proceedings. 6 McKinsey Global Institute (2010) ‘Debt and Deleveraging: The Global Credit Bubble and its Economic Consequences’, report. 7 Richard Koo (2008) The Holy Grail of Macroeconomics: Lessons from Japan’s Great Recession, John Wiley & Sons. 8 Robert Chote, Carl Emmerson and Jonathan Shaw (eds) (2010) The Green Budget 2010, Institute for Fiscal Studies. 9 Ken Coutts and Robert Rowthorn (2009) ‘Prospects for the UK Balance of Payments’, University of Cambridge Centre for Business Research Working Paper No. 394. 10 Kenneth Rogoff (2003) ‘Globalisation and Global Disinflation’, presented to the Conference on Monetary Policy and Uncertainty: Adapting to a Changing Economy, Federal Reserve Bank of Kansas City. 11 Olivier Blanchard and John Simon, ‘The Long and Large Decline in US Output Volatility’, Brooklyn Papers on Economic Activity 1 (2001): 135–64. 12 On similar themes, see Jonathan McCarthy and Egon Zakrajsek (2003) ‘Inventory Dynamics and Business Cycles: What Has Changed?’

13 Bankers: The Wall Street Takeover and the Next Financial Meltdown by Simon Johnson, James Kwak

Alan Greenspan, American ideology, Andrei Shleifer, Asian financial crisis, asset-backed security, bank run, banking crisis, Bear Stearns, Bernie Madoff, Black Monday: stock market crash in 1987, Bonfire of the Vanities, bonus culture, book value, break the buck, business cycle, business logic, buy and hold, capital controls, Carmen Reinhart, central bank independence, Charles Lindbergh, collapse of Lehman Brothers, collateralized debt obligation, commoditize, corporate governance, corporate raider, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, currency risk, Edward Glaeser, Eugene Fama: efficient market hypothesis, financial deregulation, financial engineering, financial innovation, financial intermediation, financial repression, fixed income, George Akerlof, Glass-Steagall Act, Gordon Gekko, greed is good, Greenspan put, Home mortgage interest deduction, Hyman Minsky, income per capita, information asymmetry, interest rate derivative, interest rate swap, junk bonds, Kenneth Rogoff, laissez-faire capitalism, late fees, light touch regulation, Long Term Capital Management, low interest rates, market bubble, market fundamentalism, Martin Wolf, Michael Milken, money market fund, moral hazard, mortgage tax deduction, Myron Scholes, Paul Samuelson, Ponzi scheme, price stability, profit maximization, proprietary trading, race to the bottom, regulatory arbitrage, rent-seeking, Robert Bork, Robert Shiller, Ronald Reagan, Saturday Night Live, Satyajit Das, Savings and loan crisis, sovereign wealth fund, Tax Reform Act of 1986, The Myth of the Rational Market, too big to fail, transaction costs, Tyler Cowen, value at risk, yield curve

Quoted in Wessel, In Fed We Trust, supra note 3, at 23. 25. Sorkin, Too Big to Fail, supra note 2, at 2. 26. Troubled Asset Relief Program Office of the Special Inspector General, Quarterly Report to Congress, April 21, 2009. 27. See Carmen M. Reinhart and Kenneth S. Rogoff, “Is the 2007 U.S. Subprime Crisis So Different? An International Historical Comparison,” American Economic Review 98 (2008): 339–44; and Carmen M. Reinhart and Kenneth S. Rogoff, “The Aftermath of Financial Crises” (paper presented at the meetings of the American Economic Association, January 3, 2009), available at http://www.aeaweb.org/annual_mtg_papers/2009/retrieve.php?pdfid=140. 28.

…

In January 2008, just as the economy was tipping into recession, the Congressional Budget Office (CBO) projected that, by the end of 2018, U.S. government debt would fall to $5.1 trillion, or 22.6 percent of GDP. Surveying the wreckage in August 2009, the CBO projected that debt at the end of 2018 would rise to $13.6 trillion, or 67.0 percent of GDP—a difference of $8.5 trillion.78 This should come as no surprise; Carmen Reinhart and Kenneth Rogoff have shown that, on average, modern banking crises lead to an 86 percent increase in government debt over the three years following the crisis.79 The financial crisis and the government’s emergency response also increased the likelihood of two bleak scenarios. First, the enormous amount of liquidity that the Federal Reserve poured into the economy created the long-term potential for high inflation; if the Fed cannot “mop up” that liquidity when the economy recovers, all that excess money could make dollars less valuable, driving up prices.

…

Congressional Budget Office, The Budget and Economic Outlook: Fiscal Years 2008 to 2018, January 2008, available at http://cbo.gov/ftpdocs/89xx/doc8917/01–23–2008_BudgetOutlook.pdf; Congressional Budget Office, The Budget and Economic Outlook: An Update, August 2009, available at http://cbo.gov/ftpdocs/105xx/doc10521/08–25-BudgetUpdate.pdf. 79. Carmen M. Reinhart and Kenneth S. Rogoff, This Time Is Different: Eight Centuries of Financial Folly (Princeton: Princeton University Press, 2009), 231–32. 80. Maura Reynolds and Janet Hook, “Critics Say Bush Is Not Doing Enough,” Los Angeles Times, March 18, 2008, available at http://articles.latimes.com/2008/mar/18/nation/na-bush18; cited in Sorkin, Too Big to Fail, supra note 2, at 38. 81.

What Went Wrong: How the 1% Hijacked the American Middle Class . . . And What Other Countries Got Right by George R. Tyler

"Friedman doctrine" OR "shareholder theory", "World Economic Forum" Davos, 8-hour work day, active measures, activist fund / activist shareholder / activist investor, affirmative action, Affordable Care Act / Obamacare, Alan Greenspan, bank run, banking crisis, Basel III, Bear Stearns, behavioural economics, benefit corporation, Black Swan, blood diamond, blue-collar work, Bolshevik threat, bonus culture, British Empire, business cycle, business process, buy and hold, capital controls, Carmen Reinhart, carried interest, cognitive dissonance, collateralized debt obligation, collective bargaining, commoditize, company town, compensation consultant, corporate governance, corporate personhood, corporate raider, corporate social responsibility, creative destruction, credit crunch, crony capitalism, crowdsourcing, currency manipulation / currency intervention, David Brooks, David Graeber, David Ricardo: comparative advantage, declining real wages, deindustrialization, Diane Coyle, disruptive innovation, Double Irish / Dutch Sandwich, eurozone crisis, financial deregulation, financial engineering, financial innovation, fixed income, Ford Model T, Francis Fukuyama: the end of history, full employment, George Akerlof, George Gilder, Gini coefficient, Glass-Steagall Act, Gordon Gekko, Greenspan put, hiring and firing, Ida Tarbell, income inequality, independent contractor, invisible hand, job satisfaction, John Markoff, joint-stock company, Joseph Schumpeter, junk bonds, Kenneth Rogoff, labor-force participation, laissez-faire capitalism, lake wobegon effect, light touch regulation, Long Term Capital Management, low interest rates, manufacturing employment, market clearing, market fundamentalism, Martin Wolf, minimum wage unemployment, mittelstand, Money creation, moral hazard, Myron Scholes, Naomi Klein, Northern Rock, obamacare, offshore financial centre, Paul Samuelson, Paul Volcker talking about ATMs, pension reform, performance metric, Pershing Square Capital Management, pirate software, plutocrats, Ponzi scheme, precariat, price stability, profit maximization, profit motive, prosperity theology / prosperity gospel / gospel of success, purchasing power parity, race to the bottom, Ralph Nader, rent-seeking, reshoring, Richard Thaler, rising living standards, road to serfdom, Robert Gordon, Robert Shiller, rolling blackouts, Ronald Reagan, Sand Hill Road, Savings and loan crisis, shareholder value, Silicon Valley, Social Responsibility of Business Is to Increase Its Profits, South Sea Bubble, sovereign wealth fund, Steve Ballmer, Steve Jobs, stock buybacks, subprime mortgage crisis, The Chicago School, The Spirit Level, The Theory of the Leisure Class by Thorstein Veblen, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, transcontinental railway, transfer pricing, trickle-down economics, tulip mania, Tyler Cowen, Tyler Cowen: Great Stagnation, union organizing, Upton Sinclair, upwardly mobile, women in the workforce, working poor, zero-sum game

The discipline of the gold standard and prudence of American presidents produced some global fiscal stability in the post–World War II era. Between 1960 and the early 1980s, for example, severe sovereign credit crises involving default or restructuring afflicted fewer than 15 percent of countries. That was easily the lowest share since 1827. But, as economists Carmen Reinhart and Kenneth Rogoff document in their book, This Time is Different, the number of profligate nations that became severely indebted leaped in the Reagan era. By the end of Ronald Reagan’s Presidency, nearly 40 percent of nations across the globe had succumbed to his siren song of wildcat banking and were dealing with severe debt crises.38 America hopefully will not face a debt crisis in the years ahead.

…

The added responsibility the current system imposes on trade union and employer negotiators has had similar salutary effects on inflation in Australia.26 CHAPTER 18 GLOBALIZATION CAN BE A BOON OR A BANE “The positive conclusions of the cross-country study of inequality were that widening income gaps were not inevitable and technology forces driving incomes apart could be successfully countered with active government policies…. Globalisation had little impact on the gap between rich and poor.”1 Editorial, Financial Times, December 2011 “Germany has been the winner in the globalization process.”2 KENNETH ROGOFF, Der Spiegel, February 20, 2012 “67 percent of French employees believe globalization is ‘good for employment in France.’”3 ANNE RODIER, Le Monde, June 26, 2011 Globalization holds a potent lesson for America. But as we are learning, it isn’t the one you might anticipate: families in almost all other rich democracies benefited from the acceleration of international trade in recent decades.

…

In contrast, the profit share from manufacturing has slumped to a de minimus 10 or 12 percent. Easy credit and especially deregulation hastened growth in the financial sector, featuring rising bank leverage, opaque off-balance-sheet entities, and abuse of borrowers. The Harvard banking expert Kenneth Rogoff argues that this growth occurred because deregulation created vast new—if risky—opportunities for the financial sector to speculate: “How could financial services be a third of the economy? And the answer was that it was taking much bigger risks that it should have.”9 Peter Boone of the London School of Economics and Simon Johnson also finger deregulation: “Before 1935 and after 1980, however, the Fed’s financial regulation was and has been weak.

War and Gold: A Five-Hundred-Year History of Empires, Adventures, and Debt by Kwasi Kwarteng

accounting loophole / creative accounting, Alan Greenspan, anti-communist, Asian financial crisis, asset-backed security, Atahualpa, balance sheet recession, bank run, banking crisis, Bear Stearns, Big bang: deregulation of the City of London, Bretton Woods, British Empire, business cycle, California gold rush, capital controls, Carmen Reinhart, central bank independence, centre right, collapse of Lehman Brothers, collateralized debt obligation, credit crunch, currency manipulation / currency intervention, Deng Xiaoping, discovery of the americas, Etonian, eurozone crisis, fiat currency, financial engineering, financial innovation, fixed income, floating exchange rates, foreign exchange controls, Francisco Pizarro, full employment, German hyperinflation, Glass-Steagall Act, guns versus butter model, hiring and firing, income inequality, invisible hand, Isaac Newton, it's over 9,000, John Maynard Keynes: Economic Possibilities for our Grandchildren, joint-stock company, joint-stock limited liability company, Joseph Schumpeter, Kenneth Rogoff, labour market flexibility, land bank, liberal capitalism, low interest rates, market bubble, money: store of value / unit of account / medium of exchange, moral hazard, new economy, Nixon triggered the end of the Bretton Woods system, oil shock, plutocrats, Ponzi scheme, price mechanism, quantitative easing, rolodex, Ronald Reagan, South Sea Bubble, subprime mortgage crisis, Suez canal 1869, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, the market place, The Wealth of Nations by Adam Smith, too big to fail, War on Poverty, Yom Kippur War

Such eighteenth-century luminaries as Edmund Burke, Thomas Jefferson and David Hume were all fervent in their denunciations of paper money. Today government debt and deficits are arguably the greatest challenge facing the developed economies of the world. In a widely cited book, This Time is Different: Eight Centuries of Financial Folly, Carmen Reinhart and Kenneth Rogoff analysed the nature of government indebtedness over 800 years of ‘financial folly’. Debt crises have been punctuating world history for centuries, as governments continued to spend beyond their resources. This is the theme of Reinhart and Rogoff’s work.6 My book implicitly argues a rather different case.

…

As George Papandreou swept into power after the elections of 4 October 2009, he promised a new beginning. Behind the optimism and the vague and cloudy phrases lay the reality of 200 years of Greek financial history. ‘From 1800 to well after World War II, Greece found itself virtually in continual default,’ noted Carmen Reinhart and Kenneth Rogoff in their important history of financial crises, This Time is Different.40 Such a history would perhaps have disqualified Greece automatically from ever being considered as a full participant in the euro. But it became such a participant, because political considerations were paramount in the promotion of the European single currency; economics played only a minor part.

…

Williamson, ‘The Price of Gold, 1257–2011’, MeasuringWorth, 2012, http://www.measuringworth.com/gold Total world gold stock: ‘Thomson Reuters GFMS Historic Gold Stock’, in James Turk, The Aboveground Gold Stock: Its Importance and Its Size, GoldMoney Foundation, http://www.goldmoney.com/documents/goldmoney-gold-stock.xls Notes Introduction 1John Maynard Keynes, ‘Economic Possibilities for our Grandchildren’, in Essays in Persuasion, London, 1972 (1st edn 1931), p. 323. 2Joseph Schumpeter, The Crisis of the Tax State, Vienna, 1919. 3F. W. Maitland, Domesday Book and Beyond, Cambridge, 1907, p. 9. 4Ian Fleming, Goldfinger, London, 1959. 5Philip Coggan, Paper Promises: Money, Debt and the New World Order, London, 2011, p. 3. 6Carmen M. Reinhart and Kenneth S. Rogoff, This Time is Different: Eight Centuries of Financial Folly, Princeton, 2009. 7B. R. Mitchell, British Historical Statistics, Cambridge, 1988, pp. 601–3. 8Niall Ferguson, The Cash Nexus, London, 2001, p. 126. 9A. J. P. Taylor, The Origins of the Second World War, London, 1961, p. 25. 10John Maynard Keynes, General Theory of Employment, Interest and Money, London, 2007 (1st edn 1936), p. 383. 11Peer Vries, Public Finance in China and Britain in the Long Eighteenth Century, London School of Economics, Working Papers no. 167/12, London, August 2012, p. 17. 12John Kenneth Galbraith, Money: Whence It Came, Where It Went, 2nd edn, London, 1995 (1st edn 1975), pp. 3–4.

The Classical School by Callum Williams

"Friedman doctrine" OR "shareholder theory", bank run, banking crisis, basic income, Brexit referendum, British Empire, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, Charles Babbage, complexity theory, Corn Laws, David Ricardo: comparative advantage, death from overwork, deindustrialization, Donald Trump, double entry bookkeeping, falling living standards, Fellow of the Royal Society, full employment, Gini coefficient, Gordon Gekko, greed is good, helicopter parent, income inequality, invisible hand, Jevons paradox, John Maynard Keynes: technological unemployment, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, land reform, low skilled workers, Mahatma Gandhi, Martin Wolf, means of production, Meghnad Desai, minimum wage unemployment, Modern Monetary Theory, new economy, New Journalism, non-tariff barriers, Paul Samuelson, Post-Keynesian economics, purchasing power parity, Ronald Coase, secular stagnation, Silicon Valley, spinning jenny, The Wealth of Nations by Adam Smith, Thomas Malthus, universal basic income

“Adam Smith’s Rise to Fame: A Reexamination of the Evidence”. The Eighteenth Century 23, no. 1 (1982): 64–85. Rashid, Salim. “Mandeville’s Fable: Laissez-faire or Libertinism?”. Eighteenth-Century Studies 18, no. 3 (1985): 313–330. Reeves, Richard. John Stuart Mill: Victorian Firebrand. Atlantic Books Ltd, 2015. Reinhart, Carmen M., and Kenneth S. Rogoff. 2009. This Time is Different: Eight Centuries of Financial Folly. Princeton: Princeton University Press. Riley, Jonathan. “Mill’s Political Economy: Ricardian Science and Liberal Utilitarian Art”. In J. Skorupski, ed., The Cambridge Companion to John Stuart Mill. pp. 293–337. Cambridge: Cambridge University Press, 1998.

…

Under the cooperative system the workers would own the capital that they worked with, rather than working on someone else’s capital. So all the value created in the production process would end up accruing to the workers in their joint role as labourers and owners. Chapter 10–Jean-Baptiste Say (1767–1832) 1. This is an estimate from Kenneth Rogoff and Carmen Reinhart’s database. 2. For this biographical information I am grateful to William Baumol’s research. 3. No relation to David, unfortunately. 4. As Joseph Schumpeter points out, in the United States a professorship of Moral Philosophy and Political Economy was founded at Columbia in 1818. 5.

…

This is where George Stigler’s characterisation of Ricardo as proposing a “93% labour theory of value” comes from. 14. Rothbard’s analysis of the Marx–Engels intellectual tangle is particularly interesting. Chapter 16–Friedrich Engels (1820–1895) 1. These estimates are from Carmen Reinhart and Kenneth Rogoff’s database. 2. Stalin argued that “[t]o keep on strengthening state power in order to prepare the conditions for the withering away of state power–that is the Marxist formula.” Chapter 17–William Stanley Jevons (1835–1882) 1. It is not a settled question who was the first person to suggest “economics” in place of “political economy”.

The End of Alchemy: Money, Banking and the Future of the Global Economy by Mervyn King

Alan Greenspan, Andrei Shleifer, Asian financial crisis, asset-backed security, balance sheet recession, bank run, banking crisis, banks create money, behavioural economics, Berlin Wall, Bernie Madoff, Big bang: deregulation of the City of London, bitcoin, Black Monday: stock market crash in 1987, Black Swan, Boeing 747, Bretton Woods, British Empire, business cycle, capital controls, Carmen Reinhart, Cass Sunstein, central bank independence, centre right, classic study, collapse of Lehman Brothers, creative destruction, Credit Default Swap, crowdsourcing, Daniel Kahneman / Amos Tversky, David Ricardo: comparative advantage, distributed generation, Doha Development Round, Edmond Halley, Fall of the Berlin Wall, falling living standards, fiat currency, financial engineering, financial innovation, financial intermediation, floating exchange rates, foreign exchange controls, forward guidance, Fractional reserve banking, Francis Fukuyama: the end of history, full employment, German hyperinflation, Glass-Steagall Act, Great Leap Forward, Hyman Minsky, inflation targeting, invisible hand, Japanese asset price bubble, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Meriwether, joint-stock company, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, labour market flexibility, large denomination, lateral thinking, liquidity trap, Long Term Capital Management, low interest rates, manufacturing employment, market clearing, Martin Wolf, Mexican peso crisis / tequila crisis, Money creation, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, Myron Scholes, Nick Leeson, no-fly zone, North Sea oil, Northern Rock, oil shale / tar sands, oil shock, open economy, paradox of thrift, Paul Samuelson, Ponzi scheme, price mechanism, price stability, proprietary trading, purchasing power parity, quantitative easing, rent-seeking, reserve currency, Richard Thaler, rising living standards, Robert Shiller, Robert Solow, Satoshi Nakamoto, savings glut, secular stagnation, seigniorage, stem cell, Steve Jobs, The Great Moderation, the payments system, The Rise and Fall of American Growth, Thomas Malthus, too big to fail, transaction costs, Tyler Cowen: Great Stagnation, yield curve, Yom Kippur War, zero-sum game

Bank Underground, Bank of England website. Rae, John (1895), The Life of Adam Smith, Macmillan and Co., London. Reddaway, W. Brian (1939), The Economic Consequences of a Declining Population, Allen and Unwin, London. Reinhart, Carmen M. and Kenneth S. Rogoff (2009), This Time is Different: Eight Centuries of Financial Folly, Princeton University Press, Princeton, New Jersey. Reinhart, Carmen, Vincent Reinhart and Kenneth Rogoff (2015), ‘Dealing with Debt’, Journal of International Economics, forthcoming. Ricardo, David (1816), Proposals for an Economical and Secure Currency, T. Davison, London. Roberts, Andrew (2014), Napoleon the Great, Allen Lane, London.

…

So why, after the biggest monetary stimulus the world has ever seen, and six years after the end of the banking crisis, is the world recovery so slow? Some economists believe that we are experiencing what they call ‘secular stagnation’, a phrase coined by the American economist Alvin Hansen in his 1938 book Full Recovery or Stagnation?36 Today’s American economists, such as Ben Bernanke, Paul Krugman, Kenneth Rogoff and Larry Summers, have been using the more modern literary form of blogging to debate the issue. But it is not exactly clear what they mean by secular stagnation. Does it refer to stagnation of supply or of demand, or indeed both? Growth today seems possible only if interest rates are much lower than normal – at present the long-term real rate of interest is close to zero.

Naked Economics: Undressing the Dismal Science (Fully Revised and Updated) by Charles Wheelan

affirmative action, Alan Greenspan, Albert Einstein, Andrei Shleifer, barriers to entry, Bear Stearns, behavioural economics, Berlin Wall, Bernie Madoff, Boeing 747, Bretton Woods, business cycle, buy and hold, capital controls, carbon tax, Cass Sunstein, central bank independence, classic study, clean water, collapse of Lehman Brothers, congestion charging, creative destruction, Credit Default Swap, crony capitalism, currency manipulation / currency intervention, currency risk, Daniel Kahneman / Amos Tversky, David Brooks, demographic transition, diversified portfolio, Doha Development Round, Exxon Valdez, financial innovation, fixed income, floating exchange rates, George Akerlof, Gini coefficient, Gordon Gekko, Great Leap Forward, greed is good, happiness index / gross national happiness, Hernando de Soto, income inequality, index fund, interest rate swap, invisible hand, job automation, John Markoff, Joseph Schumpeter, junk bonds, Kenneth Rogoff, libertarian paternalism, low interest rates, low skilled workers, Malacca Straits, managed futures, market bubble, microcredit, money market fund, money: store of value / unit of account / medium of exchange, Network effects, new economy, open economy, presumed consent, price discrimination, price stability, principal–agent problem, profit maximization, profit motive, purchasing power parity, race to the bottom, RAND corporation, random walk, rent control, Richard Thaler, rising living standards, Robert Gordon, Robert Shiller, Robert Solow, Ronald Coase, Ronald Reagan, Sam Peltzman, school vouchers, seminal paper, Silicon Valley, Silicon Valley startup, South China Sea, Steve Jobs, tech worker, The Market for Lemons, the rule of 72, The Wealth of Nations by Adam Smith, Thomas L Friedman, Thomas Malthus, transaction costs, transcontinental railway, trickle-down economics, urban sprawl, Washington Consensus, Yogi Berra, young professional, zero-sum game

Mary Ellen Moore and Danielle Kutasov offered excellent research assistance, finding the facts, figures, and anecdotes that had eluded me. Three accomplished economists were kind enough to take time from their busy schedules to read the first edition manuscript and make helpful comments: Burton Malkiel, Robert Willis, and Kenneth Rogoff. These three men are giants of the profession, and each had many other things that they might have done with their time. Robert Johnson was kind enough to read the international economics chapter that has been added to the second edition. I appreciate his willingness to share his expertise on the topic.

…

To the rest of the world, Brazil had thrown a giant half-price sale and Argentina could do nothing but stand by and watch. As the Argentine economy limped along, economists debated the wisdom of the currency board. The proponents argued that it was an important source of macroeconomic stability; the skeptics said that it would cause more harm than good. In 1995, Maurice Obstfeld and Kenneth Rogoff, economists at UC Berkeley and Princeton, respectively, had published a paper warning that most attempts to maintain a fixed exchange rate, such as the Argentine currency board, were likely to end in failure.7 Time proved the skeptics right. In December 2001, the long-suffering Argentine economy unraveled completely.

…

Sylvia Nasar, “Weak Dollar Makes U.S. World’s Bargain Bazaar,” New York Times, September 28, 1992. 5. Ian Rowley, “Why Japan Hasn’t Stopped the Yen’s Rise,” Business Week (online), January 15, 2009. 6. Paul Krugman, “Misguided Monetary Mentalities,” New York Times, October 12, 2009. 7. Maurice Obstfeld and Kenneth Rogoff, “The Mirage of Fixed Exchange Rates,” National Bureau of Economic Research Working Paper W5191, July 1995. 8. Anthony Ramirez, “Pepsi Will Be Bartered for Ships and Vodka in Deal With Soviets,” New York Times, April 9, 1990. 9. Peter Gumble, “Iceland: The Country That Became a Hedge Fund,” CNN Money.com, December 4, 2008. 10.

The Limits of the Market: The Pendulum Between Government and Market by Paul de Grauwe, Anna Asbury

Alan Greenspan, banking crisis, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, conceptual framework, crony capitalism, Easter island, Erik Brynjolfsson, eurozone crisis, Honoré de Balzac, income inequality, income per capita, Intergovernmental Panel on Climate Change (IPCC), invisible hand, John Maynard Keynes: Economic Possibilities for our Grandchildren, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, Kitchen Debate, means of production, Money creation, moral hazard, Paul Samuelson, price discrimination, price mechanism, profit motive, Robert Gordon, Robert Solow, Ronald Coase, Simon Kuznets, The Nature of the Firm, The Rise and Fall of American Growth, too big to fail, transaction costs, trickle-down economics, ultimatum game, very high income

This euphoria has a blinding effect, and few people notice the risks. Real estate prices and share prices continue to rise. The markets exercise no disciplining influence whatsoever on people’s behaviour. On the contrary, they lead the way to increased euphoria and an ever greater lack of discipline. As Carmen Reinhart and Kenneth Rogoff emphasize in their book This Time is Different,8 in periods of euphoria people tell tales which suggest that the price rises in shares or real estate are the result of fundamental developments. They believe that these high prices are the consequence of new technological developments and are completely justified.

…

See for example <http://www.iflscience.com/environment/climatologistarctic-carbon-release-could-mean-“were-fucked”>. . Jared Diamond, Collapse: How Societies Choose to Fail or Succeed (New York: Viking, ). . See Alan Greenspan, The Age of Turbulence: Adventures in a New World (London: Allen Lane, ). . Carmen M. Reinhardt and Kenneth S. Rogoff, This Time is Different: Eight Centuries of Financial Folly (Princeton, NJ: Princeton University Press, ). . Michael J. Sandel, What Money Can’t Buy: The Moral Limits of Markets (London: Allen Lane, ). . Kenneth J. Arrow, ‘Gifts and exchanges’, Philosophy and Public Affairs, / (), pp. –. .

The Ascent of Money: A Financial History of the World by Niall Ferguson

Admiral Zheng, Alan Greenspan, An Inconvenient Truth, Andrei Shleifer, Asian financial crisis, asset allocation, asset-backed security, Atahualpa, bank run, banking crisis, banks create money, Bear Stearns, Black Monday: stock market crash in 1987, Black Swan, Black-Scholes formula, Bonfire of the Vanities, Bretton Woods, BRICs, British Empire, business cycle, capital asset pricing model, capital controls, Carmen Reinhart, Cass Sunstein, central bank independence, classic study, collateralized debt obligation, colonial exploitation, commoditize, Corn Laws, corporate governance, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, currency peg, Daniel Kahneman / Amos Tversky, deglobalization, diversification, diversified portfolio, double entry bookkeeping, Edmond Halley, Edward Glaeser, Edward Lloyd's coffeehouse, equity risk premium, financial engineering, financial innovation, financial intermediation, fixed income, floating exchange rates, Fractional reserve banking, Francisco Pizarro, full employment, Future Shock, German hyperinflation, Greenspan put, Herman Kahn, Hernando de Soto, high net worth, hindsight bias, Home mortgage interest deduction, Hyman Minsky, income inequality, information asymmetry, interest rate swap, Intergovernmental Panel on Climate Change (IPCC), Isaac Newton, iterative process, James Carville said: "I would like to be reincarnated as the bond market. You can intimidate everybody.", John Meriwether, joint-stock company, joint-stock limited liability company, Joseph Schumpeter, junk bonds, Kenneth Arrow, Kenneth Rogoff, knowledge economy, labour mobility, Landlord’s Game, liberal capitalism, London Interbank Offered Rate, Long Term Capital Management, low interest rates, market bubble, market fundamentalism, means of production, Mikhail Gorbachev, Modern Monetary Theory, Money creation, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, mortgage debt, mortgage tax deduction, Myron Scholes, Naomi Klein, National Debt Clock, negative equity, Nelson Mandela, Nick Bostrom, Nick Leeson, Northern Rock, Parag Khanna, pension reform, price anchoring, price stability, principal–agent problem, probability theory / Blaise Pascal / Pierre de Fermat, profit motive, quantitative hedge fund, RAND corporation, random walk, rent control, rent-seeking, reserve currency, Richard Thaler, risk free rate, Robert Shiller, rolling blackouts, Ronald Reagan, Savings and loan crisis, savings glut, seigniorage, short selling, Silicon Valley, South Sea Bubble, sovereign wealth fund, spice trade, stocks for the long run, structural adjustment programs, subprime mortgage crisis, tail risk, technology bubble, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, Thomas Bayes, Thomas Malthus, Thorstein Veblen, tontine, too big to fail, transaction costs, two and twenty, undersea cable, value at risk, W. E. B. Du Bois, Washington Consensus, Yom Kippur War

In countries such as Indonesia, Malaysia, South Korea and Thailand there was a very severe recession in 1998. Yet neither Stiglitz nor Krugman offers a convincing account of how the East Asian crisis might have been better managed on standard Keynesian lines, with currencies being allowed to float and government deficits to rise. In the acerbic words of an open letter to Stiglitz by Kenneth Rogoff, who became chief economist at the IMF after the Asian crisis: Governments typically come to the IMF for financial assistance when they are having trouble finding buyers for their debt and when the value of their money is falling. The Stiglitzian prescription is to raise . . . fiscal deficits, that is, to issue more debt and to print more money.

…

Others estimated costs of a trillion dollars or more: Pontell and Calavita, ‘Savings and Loan Industry’, p. 203. 51 For a vivid account, see Michael Lewis, Liar’s Poker (London, 1989), pp. 78-124. 52 Bernanke, ‘Housing, Housing Finance, and Monetary Policy’. 53 I am grateful to Joseph Barillari for his assistance with these calculations. Morris A. Davisa, Andreas Lehnert and Robert F. Martin, ‘The Rent-Price Ratio for the Aggregate Stock of Owner-Occupied Housing’, Working paper (December 2007). 54 Shiller, ‘Recent Trends in House Prices’. 55 Carmen M. Reinhart and Kenneth S. Rogoff, ‘Is the 2007 Sub-Prime Financial Crisis So Different? An International Historical Comparison’, Draft Working Paper (14 January 2008). 56 Mark Whitehouse, ‘Debt Bomb: Inside the “Subprime” Mortgage Debacle’, Wall Street Journal, 30 May 2007, p. A1. 57 See Kimberly Blanton, ‘A “Smoking Gun” on Race, Subprime Loans’, Boston Globe, 16 March 2007. 58 ‘U.S.

…

sid=04/11/09/1526251. 62 John Perkins, Confessions of an Economic Hit Man (New York, 2004), p. xi. 63 Joseph E. Stiglitz, Globalization and Its Discontents (New York, 2002), pp. 12, 14, 15, 17. 64 Abdelal, Capital Rules, pp. 50f., 57-75. 65 Paul Krugman, The Return of Depression Economics (London, 1999). 66 ‘The Fund Bites Back’, The Economist, 4 July 2002. 67 Kenneth Rogoff, ‘The Sisters at 60’, The Economist, 22 July 2004. Cf. ‘Not Even a Cat to Rescue’, The Economist, 20 April 2006. 68 See the classic study by Fritz Stern, Gold and Iron: Bismarck, Bleichröder and the Building of the German Empire (Harmondsworth, 1987). 69 George Soros, The Alchemy of Finance: Reading the Mind of the Market (New York, 1987), pp. 27-30. 70 Robert Slater, Soros: The Life, Times and Trading Secrets of the World’s Greatest Investor (New York, 1996), pp. 48f. 71 George Soros, The New Paradigm for Financial Markets: The Credit Crash of 2008 and What It Means (New York, 2008), p. x. 72 Slater, Soros, p. 78. 73 Ibid., pp. 105, 107ff. 74 Ibid., p. 172. 75 Ibid., pp. 177, 182, 188. 76 Ibid., p. 10. 77 Ibid., p. 159. 78 Nicholas Dunbar, Inventing Money: The Story of Long-Term Capital Management and the Legends Behind It (New York, 2000), p. 92. 79 Dunbar, Inventing Money, pp. 168-73. 80 André F.

The Captured Economy: How the Powerful Enrich Themselves, Slow Down Growth, and Increase Inequality by Brink Lindsey

Airbnb, Asian financial crisis, bank run, barriers to entry, Bernie Sanders, Build a better mousetrap, Capital in the Twenty-First Century by Thomas Piketty, carbon tax, Carmen Reinhart, Cass Sunstein, collective bargaining, creative destruction, Credit Default Swap, crony capitalism, Daniel Kahneman / Amos Tversky, David Brooks, diversified portfolio, Donald Trump, Edward Glaeser, endogenous growth, experimental economics, experimental subject, facts on the ground, financial engineering, financial innovation, financial intermediation, financial repression, hiring and firing, Home mortgage interest deduction, housing crisis, income inequality, informal economy, information asymmetry, intangible asset, inventory management, invisible hand, Jones Act, Joseph Schumpeter, Kenneth Rogoff, Kevin Kelly, knowledge worker, labor-force participation, Long Term Capital Management, low skilled workers, Lyft, Mark Zuckerberg, market fundamentalism, mass immigration, mass incarceration, medical malpractice, Menlo Park, moral hazard, mortgage debt, Network effects, patent troll, plutocrats, principal–agent problem, regulatory arbitrage, rent control, rent-seeking, ride hailing / ride sharing, Robert Metcalfe, Robert Solow, Ronald Reagan, Savings and loan crisis, Silicon Valley, Silicon Valley ideology, smart cities, software patent, subscription business, tail risk, tech bro, too big to fail, total factor productivity, trade liberalization, tragedy of the anticommons, Tragedy of the Commons, transaction costs, tulip mania, Tyler Cowen, Uber and Lyft, uber lyft, Washington Consensus, white picket fence, winner-take-all economy, women in the workforce

The problem of regressive regulatory rents is much bigger than these specific instances, but we hope that a close look at these instances will suffice to give a well-grounded appreciation of how widespread and serious the problem has become. 3 FINANCE IN ANY SEARCH FOR POLICIES that slow growth and drive inequality, financial regulation is an obvious place to start. After all, the financial sector was Ground Zero for the worst economic crisis to hit this country since the Great Depression. As Harvard economists Carmen Reinhart and Kenneth Rogoff have documented, financial crises are terrible for growth because recoveries from them are generally slow and arduous.1 The US experience since the bursting of the housing bubble certainly jibes with Reinhart and Rogoff’s analysis, as the expansion in the aftermath of the Great Recession has been the slowest on record since World War II.

…

Regulatory Reform,” Progressive Policy Institute Policy Memo, May 2013, http://www.progressivepolicy.org/wp-content/uploads/2013/05/05.2013-Mandel-Carew_Regulatory-Improvement-Commission_A-Politically-Viable-Approach-to-US-Regulatory-Reform.pdf. Chapter 3 1.See Carmen M. Reinhart and Kenneth S. Rogoff, This Time It’s Different: Eight Centuries of Financial Folly (Princeton, NJ: Princeton University Press, 2011). 2.See Tyler Atkinson, David Luttrell, and Harvey Rosenblum, “How Bad Was It? The Costs and Consequences of the 2007–09 Financial Crisis,” Federal Reserve Bank of Dallas Staff Paper no. 20, July 2013, https://dallasfed.org/assets/documents/research/staff/staff1301.pdf. 3.See Jon Bakija, Adam Cole, and Bradley T.

The End of Growth: Adapting to Our New Economic Reality by Richard Heinberg

3D printing, agricultural Revolution, Alan Greenspan, Anthropocene, Apollo 11, back-to-the-land, banking crisis, banks create money, Bear Stearns, biodiversity loss, Bretton Woods, business cycle, carbon footprint, Carmen Reinhart, clean water, cloud computing, collateralized debt obligation, computerized trading, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, currency peg, David Graeber, David Ricardo: comparative advantage, degrowth, dematerialisation, demographic dividend, Deng Xiaoping, Elliott wave, en.wikipedia.org, energy transition, falling living standards, financial deregulation, financial innovation, Fractional reserve banking, full employment, Gini coefficient, Glass-Steagall Act, global village, green transition, happiness index / gross national happiness, I think there is a world market for maybe five computers, income inequality, intentional community, Intergovernmental Panel on Climate Change (IPCC), invisible hand, Isaac Newton, Jevons paradox, Kenneth Rogoff, late fees, liberal capitalism, low interest rates, mega-rich, military-industrial complex, Money creation, money market fund, money: store of value / unit of account / medium of exchange, mortgage debt, naked short selling, Naomi Klein, Negawatt, new economy, Nixon shock, offshore financial centre, oil shale / tar sands, oil shock, peak oil, Ponzi scheme, price stability, private military company, quantitative easing, reserve currency, ride hailing / ride sharing, rolling blackouts, Ronald Reagan, short selling, special drawing rights, systems thinking, The Theory of the Leisure Class by Thorstein Veblen, The Wealth of Nations by Adam Smith, Thomas Malthus, Thorstein Veblen, too big to fail, trade liberalization, tulip mania, WikiLeaks, working poor, world market for maybe five computers, zero-sum game

Moreover, much of this apparent growth has come about because of enormous injections of stimulus and bailout money from the Federal government. Subtract those, and the GDP growth of the past year or so almost disappears. On the basis of historical analysis of previous financial crises, economists Carmen Reinhart and Kenneth Rogoff conclude that the economic crisis of 2008 will have “. . .deep and lasting effects on asset prices, output and employment. Unemployment rises and housing price declines extend out for five and six years, respectively. On the encouraging side, output declines last only two years on average. Even recessions sparked by financial crises do eventually end, albeit almost invariably accompanied by massive increases in government debt....

…

., “British Economic Growth, 1270–1870,” University of Warwick, UK, published online December 6, 2010. 7. “GDP United States (Recent History),” Data360.org, data360.org/dsg.aspx?Data_Set_Group_Id=353&page=3&count=100. 8. “‘Great Recession’ Over, Research Group Says,” msnbc.msn.com, posted September 20, 2010. 9. Carmen M. Reinhart and Kenneth S. Rogoff, “The Aftermath of Financial Crises,” (presented at the meeting of the American Economic Association, San Francisco, CA, January 3, 2009). 10. In philosophy this is called the problem of induction. One cannot infer that a series of events will happen in the future just as they have in past.

…

The Atlantic, 9/21/2010theatlantic.com/business/archive/2010/09/why-we-dont-need-to-pay-down-the-national-debt/63273. 17. For a perspective on why US government debt may not face limits anytime soon, as long as the economy returns to growth, see James K. Galbraith, “Casting Light on ‘The Moment of Truth,’” The Huffington Post, posted December 3, 2010. 18. Carmen M. Reinhart and Kenneth Rogoff, This Time Is Different: Eight Centuries of Financial Folly (New Jersey: Princeton University Press, 2009). 19. See Paul Krugman, “The burden of debt,” New Y Times. 4/28/2009. krugman.blogs. nytimes.com/2009/08/28/the-burden-of-debt/; Daniel Berger, “The Deficit: Size Doesn’t Matter” (2009).

The Price of Everything: And the Hidden Logic of Value by Eduardo Porter

Alan Greenspan, Alvin Roth, AOL-Time Warner, Asian financial crisis, Ayatollah Khomeini, banking crisis, barriers to entry, behavioural economics, Berlin Wall, British Empire, capital controls, carbon tax, Carmen Reinhart, Cass Sunstein, clean water, Credit Default Swap, Deng Xiaoping, Easter island, Edward Glaeser, European colonialism, Fall of the Berlin Wall, financial deregulation, financial engineering, flying shuttle, Ford paid five dollars a day, full employment, George Akerlof, Glass-Steagall Act, Gordon Gekko, guest worker program, happiness index / gross national happiness, housing crisis, illegal immigration, immigration reform, income inequality, income per capita, informal economy, Intergovernmental Panel on Climate Change (IPCC), invisible hand, Jean Tirole, John Maynard Keynes: technological unemployment, Joshua Gans and Andrew Leigh, junk bonds, Kenneth Rogoff, labor-force participation, laissez-faire capitalism, longitudinal study, loss aversion, low skilled workers, Martin Wolf, means of production, Menlo Park, Mexican peso crisis / tequila crisis, Michael Milken, Monkeys Reject Unequal Pay, new economy, New Urbanism, peer-to-peer, pension reform, Peter Singer: altruism, pets.com, placebo effect, precautionary principle, price discrimination, price stability, rent-seeking, Richard Thaler, rising living standards, risk tolerance, Robert Shiller, Ronald Reagan, search costs, Silicon Valley, stem cell, Steve Jobs, Stewart Brand, superstar cities, The Spirit Level, The Theory of the Leisure Class by Thorstein Veblen, The Wealth of Nations by Adam Smith, Thomas Malthus, Thorstein Veblen, trade route, transatlantic slave trade, ultimatum game, unpaid internship, urban planning, Veblen good, women in the workforce, World Values Survey, Yom Kippur War, young professional, zero-sum game

What’s more, whatever we do to prevent financial turmoil, we must acknowledge an important limitation: we are unlikely to stamp out bubbles and crashes entirely. Financial crises spawned by investment surges, credit booms, and asset bubbles appear to be a standard feature of the landscape of capitalism. Economists Carmen Reinhart and Kenneth Rogoff found that of the world’s sixty-six major economies—including developed nations and the largest developing countries—only Portugal, Austria, the Netherlands, and Belgium had avoided a banking crisis between 1945 and 2007. By the end of 2008 no country was unscathed. Every time investors become enthusiastic about some new investment proposition, they assure us that this time will be different.

…

Lansing, “Speculative Growth, Overreaction, and the Welfare Cost of Technology-Driven Bubbles,” Federal Reserve Bank of San Francisco Working Paper, August 2009 (www.frbsf.org/publications/economics/papers/2008/wp08-08bk.pdf, accessed 08/08/2010); and James Edward Meeker, The Work of the Stock Exchange (New York: The Ronald Press Company, 1922), p. 419. The tally of countries that have escaped banking crises is by Carmen Reinhart and Kenneth Rogoff, “Banking Crises: An Equal Opportunity Menace,” NBER Working Paper, December 2008. 236-239 What Rationality?: Eugene Fama’s quote is in Douglas Clement, “Interview with Eugene Fama,” The Region, Federal Reserve Bank of Minnesota, December 2007. Keynes’s quote is in John Maynard Keynes, The General Theory of Employment, Interest and Money (New York: Harcourt Brace and World, 1965), p. 161.

Better, Stronger, Faster: The Myth of American Decline . . . And the Rise of a New Economy by Daniel Gross

"World Economic Forum" Davos, 2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, Affordable Care Act / Obamacare, Airbnb, Alan Greenspan, American Society of Civil Engineers: Report Card, asset-backed security, Bakken shale, banking crisis, Bear Stearns, BRICs, British Empire, business cycle, business process, business process outsourcing, call centre, carbon tax, Carmen Reinhart, clean water, collapse of Lehman Brothers, collateralized debt obligation, commoditize, congestion pricing, creative destruction, credit crunch, currency manipulation / currency intervention, demand response, Donald Trump, financial engineering, Frederick Winslow Taylor, high net worth, high-speed rail, housing crisis, hydraulic fracturing, If something cannot go on forever, it will stop - Herbert Stein's Law, illegal immigration, index fund, intangible asset, intermodal, inventory management, Kenneth Rogoff, labor-force participation, LNG terminal, low interest rates, low skilled workers, man camp, Mark Zuckerberg, Martin Wolf, Mary Meeker, Maui Hawaii, McMansion, money market fund, mortgage debt, Network effects, new economy, obamacare, oil shale / tar sands, oil shock, peak oil, plutocrats, price stability, quantitative easing, race to the bottom, reserve currency, reshoring, Richard Florida, rising living standards, risk tolerance, risk/return, scientific management, Silicon Valley, Silicon Valley startup, six sigma, Skype, sovereign wealth fund, Steve Jobs, superstar cities, the High Line, transit-oriented development, Wall-E, Yogi Berra, zero-sum game, Zipcar

The weight of history suggested that the United States, overextended and debt-ridden, was likely to suffer the same fate in the early twenty-first century that befell the British Empire in the mid-twentieth. “It’s not a thousand years that separates imperial zenith from imperial oblivion,” he said in a May 2010 speech. “It’s really a very, very short ride from the top to the bottom.”1 Kenneth Rogoff and Carmen Reinhart, economists who data-mined history in This Time Is Different, a comprehensive look at financial debacles going back to the 1300s, arrived at a similar conclusion. Centuries worth of data on finance-induced crises suggest the United States won’t be bouncing back any time soon, they concluded.

…

These recessions were unusually shallow too, with 1.49 and 0.62 percent declines in output from peak to trough, respectively.7 The only contraction worse than the one we just lived through was the Great Depression, a forty-three-month doozy that ran from August 1929 to March 1933. Our balance sheets, bank accounts, egos, and psyches simply weren’t prepared for the depth and degree of shrinkage. Or for the slowness of the recovery. As Kenneth Rogoff and Carmen Reinhart document in This Time Is Different, not all recessions are created equal. Economies recover relatively quickly from downturns that are natural outcomes of the business cycle. Having produced too much or too exuberantly, companies idle capacity until inventories are worked down, and then reopen factories when demand rises again.

Stolen: How to Save the World From Financialisation by Grace Blakeley

"Friedman doctrine" OR "shareholder theory", activist fund / activist shareholder / activist investor, asset-backed security, balance sheet recession, bank run, banking crisis, banks create money, Basel III, basic income, battle of ideas, Berlin Wall, Big bang: deregulation of the City of London, Big Tech, bitcoin, bond market vigilante , Bretton Woods, business cycle, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, capitalist realism, Carmen Reinhart, central bank independence, collapse of Lehman Brothers, collective bargaining, corporate governance, corporate raider, credit crunch, Credit Default Swap, cryptocurrency, currency peg, David Graeber, debt deflation, decarbonisation, democratizing finance, Donald Trump, emotional labour, eurozone crisis, Extinction Rebellion, extractivism, Fall of the Berlin Wall, falling living standards, financial deregulation, financial innovation, Financial Instability Hypothesis, financial intermediation, fixed income, full employment, G4S, gender pay gap, gig economy, Gini coefficient, global reserve currency, global supply chain, green new deal, Greenspan put, housing crisis, Hyman Minsky, impact investing, income inequality, inflation targeting, Intergovernmental Panel on Climate Change (IPCC), Jeremy Corbyn, job polarisation, junk bonds, Kenneth Rogoff, Kickstarter, land value tax, light touch regulation, low interest rates, low skilled workers, market clearing, means of production, Modern Monetary Theory, money market fund, Mont Pelerin Society, moral hazard, mortgage debt, negative equity, neoliberal agenda, new economy, Nixon triggered the end of the Bretton Woods system, Northern Rock, offshore financial centre, paradox of thrift, payday loans, pensions crisis, Phillips curve, Ponzi scheme, Post-Keynesian economics, post-war consensus, price mechanism, principal–agent problem, profit motive, quantitative easing, race to the bottom, regulatory arbitrage, reserve currency, Right to Buy, rising living standards, risk-adjusted returns, road to serfdom, Robert Solow, savings glut, secular stagnation, shareholder value, Social Responsibility of Business Is to Increase Its Profits, sovereign wealth fund, the built environment, The Great Moderation, too big to fail, transfer pricing, universal basic income, Winter of Discontent, working-age population, yield curve, zero-sum game

The pre-crisis boom had merely disguised an underlying trend towards stagnation that had set in decades earlier. And since the crisis, the problem has only grown worse. Whilst GDP growth, wages, and employment have all fallen, Summers’ biggest worry was productivity — the long-term driver of economic growth in capitalist economies. Summers’ remarks have divided economists. Some, like Kenneth Rogoff, argue that slow growth and productivity are to be expected in the wake of a massive financial crisis.20 Households and businesses will all be attempting to deleverage at the same time, creating a Keynesian “paradox of thrift” — the kind of reverse economic multiplier caused when governments, households, or businesses cut their spending.

…

The idea that the UK is on the verge of a sovereign debt crisis is laughable. If anything, investors are demanding more government bonds than states like the UK are willing to issue. The second argument for austerity is that high levels of debt curb economic growth. This argument has featured heavily in the debate about austerity thanks to Carmen Reinhart and Kenneth Rogoff, the authors of This Time Is Different: Eight Centuries of Financial Folly, the book used to justify George Osborne’s austerity agenda. This Time Is Different argues that above a particular level — 90% of GDP — government debt has a negative and statistically significant impact on growth. This argument has a long history.

The Economists' Hour: How the False Prophets of Free Markets Fractured Our Society by Binyamin Appelbaum

90 percent rule, airline deregulation, Alan Greenspan, Alvin Roth, Andrei Shleifer, anti-communist, battle of ideas, Benoit Mandelbrot, Big bang: deregulation of the City of London, Bretton Woods, British Empire, business cycle, capital controls, Carmen Reinhart, Cass Sunstein, Celtic Tiger, central bank independence, clean water, collective bargaining, Corn Laws, correlation does not imply causation, Credit Default Swap, currency manipulation / currency intervention, David Ricardo: comparative advantage, deindustrialization, Deng Xiaoping, desegregation, Diane Coyle, Donald Trump, Dr. Strangelove, ending welfare as we know it, financial deregulation, financial engineering, financial innovation, fixed income, flag carrier, floating exchange rates, full employment, George Akerlof, George Gilder, Gini coefficient, greed is good, Greenspan put, Growth in a Time of Debt, Ida Tarbell, income inequality, income per capita, index fund, inflation targeting, invisible hand, Isaac Newton, It's morning again in America, Jean Tirole, John Markoff, Kenneth Arrow, Kenneth Rogoff, land reform, Les Trente Glorieuses, long and variable lags, Long Term Capital Management, low cost airline, low interest rates, manufacturing employment, means of production, Menlo Park, minimum wage unemployment, Mohammed Bouazizi, money market fund, Mont Pelerin Society, Network effects, new economy, Nixon triggered the end of the Bretton Woods system, oil shock, Paul Samuelson, Philip Mirowski, Phillips curve, plutocrats, precautionary principle, price stability, profit motive, public intellectual, Ralph Nader, RAND corporation, rent control, rent-seeking, Richard Thaler, road to serfdom, Robert Bork, Robert Gordon, Robert Solow, Ronald Coase, Ronald Reagan, Sam Peltzman, Savings and loan crisis, Silicon Valley, Simon Kuznets, starchitect, Steve Bannon, Steve Jobs, supply-chain management, The Chicago School, The Great Moderation, The Myth of the Rational Market, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, transaction costs, trickle-down economics, ultimatum game, Unsafe at Any Speed, urban renewal, War on Poverty, Washington Consensus, We are all Keynesians now

The Italian economists Alberto Alesina and Silvia Ardagna published a study in October 2009 that said governments could spur economic growth by reducing budget deficits — in other words, by spending less money rather than more.6 A few months later, in January 2010, the American economists Carmen Reinhart and Kenneth Rogoff published a paper purporting to identify a kind of red line for government borrowing: they said that when debts exceeded 90 percent of a nation’s annual economic output, growth declined.7 The European Commission’s head of economic and monetary affairs, Olli Rehn, started talking about a “90-percent rule.”

…

He predicted, incorrectly, that the effort could end in a return to double-digit inflation. See Alan Greenspan, The Map and the Territory (New York: Penguin Press, 2013), 269. 111. The worldwide decline in inflation was driven in large measure by globalization, rather than the specific policy choices of central banks. See Kenneth S. Rogoff, “Globalization and Global Disinflation,” in Monetary Policy and Uncertainty: Adapting to a Changing Economy (Kansas City, Mo.: Federal Reserve Bank of Kansas City, 2003), 81. 112. Greg Ip, “Is Bernanke an Inflation Dove? Yes, but . . .,” Wall Street Journal, October 31, 2005. 113. Lawrence H.

…

Alan Greenspan, “Testimony Before the Joint Economic Committee, June 9, 2005,” Joint Economic Committee. 81. By some estimates, the inflow of global savings reduced interest rates in the United States by as much as a full percentage point. For more on the interplay of trade imbalances and the financial crisis, see Maurice Obstfeld and Kenneth Rogoff, “Global Imbalances and the Financial Crisis: Products of Common Causes,” November 2009; available at https://eml.berkeley.edu/~obstfeld/santabarbara.pdf. 82. Much of the money came from Asia. In his book Crashed, Adam Tooze documents that Europe played a substantial role, too. Some economists argue the Fed could have limited the credit bubble by raising interest rates more sharply and quickly.

Hubris: Why Economists Failed to Predict the Crisis and How to Avoid the Next One by Meghnad Desai

3D printing, Alan Greenspan, bank run, banking crisis, Bear Stearns, Berlin Wall, Big bang: deregulation of the City of London, Bretton Woods, BRICs, British Empire, business cycle, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, central bank independence, collapse of Lehman Brothers, collateralized debt obligation, correlation coefficient, correlation does not imply causation, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, David Ricardo: comparative advantage, deindustrialization, demographic dividend, Eugene Fama: efficient market hypothesis, eurozone crisis, experimental economics, Fall of the Berlin Wall, financial innovation, Financial Instability Hypothesis, floating exchange rates, full employment, German hyperinflation, Glass-Steagall Act, Gunnar Myrdal, Home mortgage interest deduction, imperial preference, income inequality, inflation targeting, invisible hand, Isaac Newton, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, laissez-faire capitalism, liquidity trap, Long Term Capital Management, low interest rates, market bubble, market clearing, means of production, Meghnad Desai, Mexican peso crisis / tequila crisis, mortgage debt, Myron Scholes, negative equity, Northern Rock, oil shale / tar sands, oil shock, open economy, Paul Samuelson, Phillips curve, Post-Keynesian economics, price stability, purchasing power parity, pushing on a string, quantitative easing, reserve currency, rising living standards, risk/return, Robert Shiller, Robert Solow, Ronald Reagan, savings glut, secular stagnation, seigniorage, Silicon Valley, Simon Kuznets, subprime mortgage crisis, The Chicago School, The Great Moderation, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, The Wealth of Nations by Adam Smith, Tobin tax, too big to fail, women in the workforce

–Apr. 1971). 4.Gerard Duménil and Dominique Lévy, “The Crisis of the Early 21st Century: Marxian Perspectives,” in R. Bellofiore and G. Vertova, eds, The Great Recession and the Contradictions of Contemporary Capitalism (Edward Elgar, Cheltenham, 2014). 5.Piketty, Capital in the Twenty-First Century, ch. 5. 6.Carmen M. Reinhart and Kenneth S. Rogoff, This Time Is Different: Eight Centuries of Financial Folly (Princeton University Press, Princeton, NJ, 2009). 7.Lawrence Summers, “Why Stagnation May Prove to Be the New Normal,” Financial Times, Dec. 15, 2013. 8.Julia Leung, The Tides of Capital: How Asia Surmounted the Crisis and Is Now Guiding World Recovery (Official Monetary and Financial Institutions Forum, London, 2015). 9.Karl Marx, Preface to A Contribution to the Critique of Political Economy (1859), trans.

…

(i) Phillips curve (i), (ii), (iii), (iv), (v), (vi), (vii) Friedman’s challenge (i) Friedman’s version (i) Phillips’ historical study (i) Pigou, Arthur Cecil (i), (ii), (iii) equation (i) “The Classical Stationary State” (i) Piketty, Thomas (i), (ii) Pitt, William (younger) (i) point of maximum efficiency (i) policy, responses to (i) politics, effect of economic change (i) population aging (i), (ii) growth (i), (ii), (iii), (iv) Malthus’ law (i) portfolio selection (i) Post-Keynesians (i) postwar economic order, planning for (i) poverty, urban (i) precautionary motive (i) precious metals acquisition of (i) as indicators of wealth (i) predictive modeling (i), (ii) preemptive tax cut (i) preference shocks (i) price, as value (i) price levels, new classical model (i) price rises 1492 to 1589 (i) and inflation (i) post-World War I (i) vs. value (i) price takers, vs. price setters (i) price volatility, Smith’s theory (i) prices agricultural (i) determination (i) empirical analysis of asset prices (i) and productivity (i) sticky (i) Prices and Production (Hayek) (i) pricing, monopoly power (i) Prince, Chuck (i) Principle of Motion (i) Principles of Economics (Marshall) (i) private spending, control of (i) privatization (i) problems, concealment by accounting (i) productivity and price of goods (i) and prosperity (i) professionalization, of economics (i) profit (i) dependence on market (i) effects of progress (i) vs. interest (i) maximization (i) realization of (i) as unearned income (i) profit rates, and unrestricted movement of capital (i) profit squeeze (i) profitability (i) progress, effects on profit (i) Progressive Movement, United States (i) prospect of recovery (i) prosperity (i), (ii), (iii) protectionism (i), (ii) public debt (i) as intergenerational (i) Keynesian models (i) public policy, inflation targeting (i) purchasing power parity (PPP) theory (i) quantitative easing (i) see also liquidity injecting quantity theory of money (i), (ii), (iii) railroads (i), (ii) Rajan, Raghuram (i), (ii) random events (i), (ii), (iii) rate of profit, and unrestricted movement of capital (i) rates of return, ex ante/ex post calculations (i) rational expectations (RE) (i), (ii), (iii) ready cash (i) Reagan, Ronald (i) real balance effect (i) real interest parity (i) real wages (i), (ii), (iii), (iv), (v), (vi), (vii) see also money wages; wages recapitalization, banks (i) reconstruction (i), (ii) recovery, prospect of (i) redistribution (i) regulation of banks (i) financial and commodity markets (i) UK approach (i) Reinhardt, Carmen M. (i) “This Time is Different” (with Kenneth Rogoff) (i) relative value (i) Ricardo (i) religion, prohibition of usury (i) religious beliefs (i) rentier class (i) rents, as unearned income (i), (ii) research tradition, constraints of (i) reserve currency (i), (ii) residual (i) resource exploitation, effects of (i) resources, reactivation (i) restricted capital movements (i) retrenchment, post-World War I (i) return, and risk (i) Ricardian Equivalence (i), (ii) Ricardian theory, failure of (i) Ricardo, Abraham Israel (i) Ricardo, David (i) character and biography (i) context of writings (i) free trade (i) iron law of wages (i), (ii) pessimism (i) on population growth (i) on profit (i) relative value (i) on rents (i) significance of work (i), (ii) theory of depreciation (i) theory of equilibrium (i), (ii), (iii) theory of the markets (i) trade doctrine (i) right of revolt (i) right-wing politics (i), (ii) risk (i) management and pricing (i) perpetuation (i) and return (i) spreading (i) Roaring Twenties (i) Robinson, Joan (i) rocking horse analogy (i), (ii) Rogoff, Kenneth S.

Profiting Without Producing: How Finance Exploits Us All by Costas Lapavitsas

Alan Greenspan, Andrei Shleifer, asset-backed security, bank run, banking crisis, Basel III, Bear Stearns, borderless world, Branko Milanovic, Bretton Woods, business cycle, capital controls, Carmen Reinhart, central bank independence, collapse of Lehman Brothers, computer age, conceptual framework, corporate governance, credit crunch, Credit Default Swap, David Graeber, David Ricardo: comparative advantage, disintermediation, diversified portfolio, Erik Brynjolfsson, eurozone crisis, everywhere but in the productivity statistics, false flag, financial deregulation, financial independence, financial innovation, financial intermediation, financial repression, Flash crash, full employment, general purpose technology, Glass-Steagall Act, global value chain, global village, High speed trading, Hyman Minsky, income inequality, inflation targeting, informal economy, information asymmetry, intangible asset, job satisfaction, joint-stock company, Joseph Schumpeter, Kenneth Rogoff, liberal capitalism, London Interbank Offered Rate, low interest rates, low skilled workers, M-Pesa, market bubble, means of production, Minsky moment, Modern Monetary Theory, Money creation, money market fund, moral hazard, mortgage debt, Network effects, new economy, oil shock, open economy, pensions crisis, post-Fordism, Post-Keynesian economics, price stability, Productivity paradox, profit maximization, purchasing power parity, quantitative easing, quantitative trading / quantitative finance, race to the bottom, regulatory arbitrage, reserve currency, Robert Shiller, Robert Solow, savings glut, Scramble for Africa, secular stagnation, shareholder value, Simon Kuznets, special drawing rights, Thales of Miletus, The Chicago School, The Great Moderation, the payments system, The Wealth of Nations by Adam Smith, Tobin tax, too big to fail, total factor productivity, trade liberalization, transaction costs, union organizing, value at risk, Washington Consensus, zero-sum game

At the time neither the British, nor the world economy possessed sufficiently mature credit mechanisms to allow circulation to thrive on inconvertible credit money. 49 Banknotes also function in criminal, illicit or ‘grey’ transactions, and large volumes are typically held outside their country of issue; for evidence on the largest countries, see Kenneth Rogoff, ‘Blessing or Curse? Foreign and Underground Demand for Euro Notes’, Economic Policy 13:26, April 1998. This issue is also briefly considered in the following section. 50 As is clearly established in Charles Freedman, ‘Monetary Policy Implementation: Past, Present and Future’, International Finance 3:2, 2000. 51 This essential similarity creates technical problems of classification and presentation of figures, which are apparent, for instance, in the sudden jumps of the time series for Japan in Figures 4 and 5.

…

Prescott, ‘Rules Rather than Discretion: The Inconsistency of Optimal Plans’, Journal of Political Economy 85:3, 1977; Robert Barro and David Gordon, ‘A Positive Theory of Monetary Policy in a Natural-Rate Model’, Journal of Political Economy 91:4, 1983; Barro and Gordon, ‘Rules, Discretion and Reputation in a Model of Monetary Policy’, Journal of Monetary Economics 12:1, 1983; Alberto Alesina and Guido Tabellini, ‘Rules and Discretion with Non-coordinated Monetary Policies’, Economic Enquiry 25:4, 1987; Kenneth Rogoff, ‘The Optimal Degree of Commitment to an Intermediate Monetary Target’, Quarterly Journal of Economics 100:4, 1985; Rogoff, ‘Reputational Constraints on Monetary Policy’, Carnegie-Rochester Conference Series on Public Policy 26, Spring 1987. For a critique see Bennett T. McCallum, ‘Two Fallacies Concerning Central Bank Independence’, American Economic Review 85:2, May 1995; and McCallum, ‘Crucial Issues Concerning Central Bank Independence’, Journal of Monetary Economics 39:1, 1997.

European Spring: Why Our Economies and Politics Are in a Mess - and How to Put Them Right by Philippe Legrain

3D printing, Airbnb, Alan Greenspan, Asian financial crisis, bank run, banking crisis, barriers to entry, Basel III, battle of ideas, Berlin Wall, Big bang: deregulation of the City of London, book value, Boris Johnson, Bretton Woods, BRICs, British Empire, business cycle, business process, capital controls, Capital in the Twenty-First Century by Thomas Piketty, carbon tax, Carmen Reinhart, Celtic Tiger, central bank independence, centre right, clean tech, collaborative consumption, collapse of Lehman Brothers, collective bargaining, corporate governance, creative destruction, credit crunch, Credit Default Swap, crony capitalism, Crossrail, currency manipulation / currency intervention, currency peg, debt deflation, Diane Coyle, disruptive innovation, Downton Abbey, Edward Glaeser, Elon Musk, en.wikipedia.org, energy transition, eurozone crisis, fear of failure, financial deregulation, financial engineering, first-past-the-post, Ford Model T, forward guidance, full employment, Gini coefficient, global supply chain, Great Leap Forward, Growth in a Time of Debt, high-speed rail, hiring and firing, hydraulic fracturing, Hyman Minsky, Hyperloop, immigration reform, income inequality, interest rate derivative, Intergovernmental Panel on Climate Change (IPCC), Irish property bubble, James Dyson, Jane Jacobs, job satisfaction, Joseph Schumpeter, Kenneth Rogoff, Kickstarter, labour market flexibility, labour mobility, land bank, liquidity trap, low interest rates, margin call, Martin Wolf, mittelstand, moral hazard, mortgage debt, mortgage tax deduction, North Sea oil, Northern Rock, offshore financial centre, oil shale / tar sands, oil shock, open economy, peer-to-peer rental, price stability, private sector deleveraging, pushing on a string, quantitative easing, Richard Florida, rising living standards, risk-adjusted returns, Robert Gordon, savings glut, school vouchers, self-driving car, sharing economy, Silicon Valley, Silicon Valley startup, Skype, smart grid, smart meter, software patent, sovereign wealth fund, Steve Jobs, The Death and Life of Great American Cities, The Wealth of Nations by Adam Smith, too big to fail, total factor productivity, Tyler Cowen, Tyler Cowen: Great Stagnation, working-age population, Zipcar

Along with Alesina’s claptrap, another flawed economic study that was influential with eurozone policymakers, notably European Commission fiscal enforcer Olli Rehn, purported to show that the economy grinds to a halt once public debt exceeds 90 per cent of GDP.202 Since government debt in the eurozone as a whole was nearing that apparent threshold in 2010 – and had exceeded it in several countries – this appeared to warrant immediate, front-loaded austerity.203 But the “findings” in the paper published in January 2010 by Harvard economists Carmen Reinhart and Kenneth Rogoff were always dubious – and they were later discredited.204 Reinhart and Rogoff found that high public debt was associated with slow growth but did not establish that the former caused the latter. While high debt may lead to slow growth, it is more plausible that slow growth leads to high debt, and that a third factor may determine both.

…

“Stability Programme for Spain, 2011–2014” http://ec.europa.eu/europe2020/pdf/nrp/sp_spain_en.pdf 200 http://www.cnbc.com/id/38987325/Austerity_Equals_Confidence_Trichet 201 http://www.ecb.int/pub/pdf/annrep/ar2010annualaccounts_en.pdf 202 For example, in a speech to the Council of Foreign Relations in Brussels on 1 June 2011, Olli Rehn said "Carmen Reinhart and Kenneth Rogoff have coined the ‘90 per cent rule’, that is, countries with public debt exceeding 90 per cent of annual economic output grow more slowly. High debt levels can crowd out economic activity and entrepreneurial dynamism, and thus hamper growth. This conclusion is particularly relevant at a time when debt levels in Europe are now approaching the 90% threshold, which the US has already passed." http://europa.eu/rapid/press-release_SPEECH-11-407_en.htm Even in February 2013, when the devastating consequences of austerity were apparent, Rehn wrote to EU finance ministers stating that "it is widely acknowledged, based on serious academic research, that when public debt levels rise above 90 per cent they tend to have a negative impact on economic dynamism, which translates into low growth for many years.

…

That is why consistent and carefully calibrated fiscal consolidation remains necessary in Europe.” http://ec.europa.eu/commission_2010-2014/rehn/documents/cab20130213_en.pdf 203 Eurostat, general government consolidated gross debt. Code: tsieb090. In the eurozone as a whole this was 85.4 per cent of GDP in 2010, 87.3 per cent in 2011 and 90.6 per cent in 2012. 204 Carmen Reinhart and Kenneth Rogoff, "Growth in a Time of Debt", NBER working paper 15639, January 2010 205 http://www.nextnewdeal.net/rortybomb/guest-post-reinhartrogoff-and-growth-time-debt 206 A point eloquently made by Adam Posen here: http://www.ft.com/cms/s/0/a6d94b02-a774-11e2-9fbe-00144feabdc0.html 207 Thomas Herndon, Michael Ash and Robert Pollin, "Does High Public Debt Consistently Stifle Economic Growth?

Phishing for Phools: The Economics of Manipulation and Deception by George A. Akerlof, Robert J. Shiller, Stanley B Resor Professor Of Economics Robert J Shiller

Andrei Shleifer, asset-backed security, Bear Stearns, behavioural economics, Bernie Madoff, business cycle, Capital in the Twenty-First Century by Thomas Piketty, Carl Icahn, collapse of Lehman Brothers, compensation consultant, corporate raider, Credit Default Swap, Daniel Kahneman / Amos Tversky, dark matter, David Brooks, desegregation, en.wikipedia.org, endowment effect, equity premium, financial intermediation, financial thriller, fixed income, full employment, George Akerlof, greed is good, income per capita, invisible hand, John Maynard Keynes: Economic Possibilities for our Grandchildren, junk bonds, Kenneth Arrow, Kenneth Rogoff, late fees, loss aversion, market bubble, Menlo Park, mental accounting, Michael Milken, Milgram experiment, money market fund, moral hazard, new economy, Pareto efficiency, Paul Samuelson, payday loans, Ponzi scheme, profit motive, publication bias, Ralph Nader, randomized controlled trial, Richard Thaler, Robert Shiller, Robert Solow, Ronald Reagan, Savings and loan crisis, short selling, Silicon Valley, stock buybacks, the new new thing, The Predators' Ball, the scientific method, The Theory of the Leisure Class by Thorstein Veblen, The Wealth of Nations by Adam Smith, theory of mind, Thorstein Veblen, too big to fail, transaction costs, Unsafe at Any Speed, Upton Sinclair, Vanguard fund, Vilfredo Pareto, wage slave

., “Why Did Household Mortgage Leverage Rise from the Mid-1980s until the Great Recession?” Massachusetts Institute of Technology, Center for Real Estate, January 2013, last accessed May 12, 2015, http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.269.5704&rep=rep1&type=pdf. 22. See Carmen M. Reinhardt and Kenneth Rogoff, This Time Is Different: Eight Centuries of Financial Folly (Princeton: Princeton University Press, 2009). 23. John Kenneth Galbraith, The Great Crash, 50th anniversary ed. (New York: Houghton Mifflin, 1988), Kindle location 1943–45 out of 4151. 24. James Harvey Young, The Toadstool Millionaires: A Social History of Patent Medicines in America before Federal Regulation (Princeton: Princeton University Press, 1961), p. 248. 25.

…

Brookings Papers on Economic Activity (Spring 2010): 129–99. Raymond, Nate, and Jonathan Stempel. “Big Fine Imposed on Ex-Goldman Trader Tourre in SEC Case.” Reuters, March 12, 2014. Accessed March 15, 2015. http://www.reuters.com/article/2014/03/12/us-goldmansachs-sec-tourre-idUSBREA2B11220140312. Reinhardt, Carmen M., and Kenneth Rogoff. This Time Is Different: Eight Centuries of Financial Folly. Princeton: Princeton University Press, 2009. Reyes, Sonia. “Ocean Spray Rides Diet Wave.” Adweek, February 6, 2006. Accessed November 18, 2014. http://www.adweek.com/news/advertising/ocean-spray-rides-diet-wave-83901. Richert, Lindley B.

A Nation of Takers: America’s Entitlement Epidemic by Nicholas Eberstadt, Nick Eberstadt

Affordable Care Act / Obamacare, corporate governance, family office, income inequality, informal economy, Kenneth Rogoff, labor-force participation, military-industrial complex, moral hazard, reserve currency, women in the workforce, working-age population

Derived from life tables presented in the Human Mortality Database, University of California–Berkeley and Max Planck Institute for Demographic Research, http://www.mortality.org. 36. Alberto F. Alesina, Edward L. Glaeser, and Bruce Sacerdote, “Work and Leisure in the U.S. and Europe: Why So Different?” In Mark Gertler and Kenneth Rogoff, eds., NBER Macroeconomic Annual 2005 (Cambridge, MA: MIT Press, 2006), Table 2 See http://www.nber.org/ chapters/c0073.pdf. 37. International Labor Office Department of Statistics, LABORSTA Database, “Total and Economically Active Population by Age Group” for USA and EU-15 Countries (Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden, and United Kingdom).

The Health Gap: The Challenge of an Unequal World by Michael Marmot

active measures, active transport: walking or cycling, Affordable Care Act / Obamacare, Atul Gawande, Bonfire of the Vanities, Broken windows theory, cakes and ale, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, Celtic Tiger, centre right, clean water, cognitive load, congestion charging, correlation does not imply causation, Doha Development Round, epigenetics, financial independence, future of work, Gini coefficient, Growth in a Time of Debt, illegal immigration, income inequality, Indoor air pollution, Kenneth Rogoff, Kibera, labour market flexibility, longitudinal study, lump of labour, Mahatma Gandhi, Mahbub ul Haq, meta-analysis, microcredit, move 37, New Urbanism, obamacare, paradox of thrift, race to the bottom, Rana Plaza, RAND corporation, road to serfdom, Simon Kuznets, Socratic dialogue, structural adjustment programs, the built environment, The Spirit Level, trickle-down economics, twin studies, urban planning, Washington Consensus, Winter of Discontent, working poor

As so often, what should be an informed debate about evidence is a none-too-veiled contest about prior political beliefs, or short-term low-level politics. It is difficult for a non-economist to penetrate the argument and form an independent judgement. It can be noted that the intellectual case for austerity has suffered a couple of recent blows. Austerians have cited, among others, the Harvard economists Carmen Reinhart and Kenneth Rogoff, who set out to show that when national debt climbs above 90 per cent of GDP, economic growth slows.30 They showed it, except that a graduate student checking their figures found elementary errors that cast considerable doubt on their conclusions.31 Second, the IMF, which arguably has wreaked great havoc globally with its universal prescription to cut government spending, has published new estimates that austerity has a bigger effect on slowing economic growth than it used to think.32 In Britain, the Office of Budget Responsibility says that it subscribes to the widely held assumption that fiscal contraction damages growth.

…

It had gone from being a well-organised society based on fishing and huge supplies of geothermal energy – hence aluminium smelting – to housing three private banks that represented everyone’s worst nightmare of what reckless cowboys can do when let loose on the global economy. In Chapter 6, I referred to the debate around the work of Harvard economists Carmen Reinhart and Kenneth Rogoff who showed that when national debt climbs above 90 per cent of GDP, economic growth slows.2,3 At its peak, Iceland’s debt was 850 per cent of GDP! Icelandic banks bought assets round the world, as though all curves go ever upwards without a day of reckoning. The butterfly that flapped its wings might have been the collapse of sub-prime mortgages in the USA, but it caused a hurricane in Iceland and, predictably, the castles in the air were reduced to rubble.

Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist by Kate Raworth

"Friedman doctrine" OR "shareholder theory", 3D printing, Alan Greenspan, Alvin Toffler, Anthropocene, Asian financial crisis, bank run, basic income, battle of ideas, behavioural economics, benefit corporation, Berlin Wall, biodiversity loss, bitcoin, blockchain, Branko Milanovic, Bretton Woods, Buckminster Fuller, business cycle, call centre, Capital in the Twenty-First Century by Thomas Piketty, carbon tax, Cass Sunstein, choice architecture, circular economy, clean water, cognitive bias, collapse of Lehman Brothers, complexity theory, creative destruction, crowdsourcing, cryptocurrency, Daniel Kahneman / Amos Tversky, David Ricardo: comparative advantage, degrowth, dematerialisation, disruptive innovation, Douglas Engelbart, Douglas Engelbart, Easter island, en.wikipedia.org, energy transition, Erik Brynjolfsson, Ethereum, ethereum blockchain, Eugene Fama: efficient market hypothesis, experimental economics, Exxon Valdez, Fall of the Berlin Wall, financial deregulation, Financial Instability Hypothesis, full employment, Future Shock, Garrett Hardin, Glass-Steagall Act, global supply chain, global village, Henri Poincaré, hiring and firing, Howard Zinn, Hyman Minsky, income inequality, Intergovernmental Panel on Climate Change (IPCC), invention of writing, invisible hand, Isaac Newton, it is difficult to get a man to understand something, when his salary depends on his not understanding it, John Maynard Keynes: Economic Possibilities for our Grandchildren, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, Kickstarter, land reform, land value tax, Landlord’s Game, loss aversion, low interest rates, low skilled workers, M-Pesa, Mahatma Gandhi, market fundamentalism, Martin Wolf, means of production, megacity, Minsky moment, mobile money, Money creation, Mont Pelerin Society, Myron Scholes, neoliberal agenda, Network effects, Occupy movement, ocean acidification, off grid, offshore financial centre, oil shale / tar sands, out of africa, Paul Samuelson, peer-to-peer, planetary scale, price mechanism, quantitative easing, randomized controlled trial, retail therapy, Richard Thaler, Robert Solow, Ronald Reagan, Second Machine Age, secular stagnation, shareholder value, sharing economy, Silicon Valley, Simon Kuznets, smart cities, smart meter, Social Responsibility of Business Is to Increase Its Profits, South Sea Bubble, statistical model, Steve Ballmer, systems thinking, TED Talk, The Chicago School, The Great Moderation, the map is not the territory, the market place, The Spirit Level, The Wealth of Nations by Adam Smith, Thomas Malthus, Thorstein Veblen, too big to fail, Torches of Freedom, Tragedy of the Commons, trickle-down economics, ultimatum game, universal basic income, Upton Sinclair, Vilfredo Pareto, wikimedia commons

Today, an increasing number of governments in high-income countries face very real prospects of low or no GDP growth over the coming decades and, for the first time, some are quietly asking if economists have ideas about how to embrace that reality. Support for such thinking is emerging from the most unexpected of places, such as the influential mainstream US economist Kenneth Rogoff, whose career has spanned the IMF, the US Federal Reserve and Harvard University. ‘In a period of great economic uncertainty,’ he wrote in 2012, ‘it may seem inappropriate to question the growth imperative. But then again, perhaps a crisis is exactly the occasion to rethink the longer-term goals of global economic policy.’47 Let’s take up the opportunity of this prolonged crisis and start identifying the various ways – financial, political and social – in which today’s high-income economies, and others following their path, are locked into and addicted to pursuing GDP growth.

…

Home to over 550 million people and 25% of World GDP, these cities – and their economic vision – will be profoundly influential far beyond their city limits.66 New games help, but the compulsion of the old GDP game holds its grip because GDP brings both global market power and global military power. This geopolitical lock-in demands far more strategic attention. ‘An economic race for global power is certainly an understandable rationale for focusing on long-term growth,’ argues Kenneth Rogoff, ‘but if such competition is really a central justification for this focus, then we need to re-examine standard macroeconomic models, which ignore this issue entirely.’67 Beyond merely rewriting macroeconomic models, however, this lock-in highlights the need for innovative thinkers in international relations to turn their attention to strategies that could help to usher in a future of growth-agnostic global governance.

The Economics of Enough: How to Run the Economy as if the Future Matters by Diane Coyle

accounting loophole / creative accounting, affirmative action, Alan Greenspan, An Inconvenient Truth, bank run, banking crisis, behavioural economics, Berlin Wall, bonus culture, Branko Milanovic, BRICs, business cycle, call centre, carbon tax, Cass Sunstein, central bank independence, classic study, collapse of Lehman Brothers, conceptual framework, corporate governance, correlation does not imply causation, Credit Default Swap, deindustrialization, demographic transition, Diane Coyle, different worldview, disintermediation, Edward Glaeser, endogenous growth, Eugene Fama: efficient market hypothesis, experimental economics, Fall of the Berlin Wall, Financial Instability Hypothesis, Francis Fukuyama: the end of history, general purpose technology, George Akerlof, Gini coefficient, global supply chain, Gordon Gekko, greed is good, happiness index / gross national happiness, hedonic treadmill, Hyman Minsky, If something cannot go on forever, it will stop - Herbert Stein's Law, illegal immigration, income inequality, income per capita, industrial cluster, information asymmetry, intangible asset, Intergovernmental Panel on Climate Change (IPCC), invisible hand, Jane Jacobs, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, knowledge economy, light touch regulation, low skilled workers, market bubble, market design, market fundamentalism, megacity, Network effects, new economy, night-watchman state, Northern Rock, oil shock, Paradox of Choice, Pareto efficiency, principal–agent problem, profit motive, purchasing power parity, railway mania, rising living standards, Robert Solow, Ronald Reagan, selective serotonin reuptake inhibitor (SSRI), Silicon Valley, social contagion, South Sea Bubble, Steven Pinker, tacit knowledge, The Design of Experiments, The Fortune at the Bottom of the Pyramid, The Market for Lemons, The Myth of the Rational Market, The Spirit Level, the strength of weak ties, Tragedy of the Commons, transaction costs, transfer pricing, tulip mania, ultimatum game, University of East Anglia, vertical integration, web application, web of trust, winner-take-all economy, World Values Survey, zero-sum game

And a mix of the various possibilities is likely. Higher growth would be terrific but is hard to achieve. Additional migration on a large scale is probably unlikely given that it has already reached such high levels compared with the recent past, although it will continue. According to Carmen Reinhardt and Kenneth Rogoff, default is a surprisingly common policy response to financial crisis, in a mix of the forms described above, and often described as “restructuring.” In their thorough study of the history of financial crises, they conclude that not only do crises commonly cause very large increases in public debt, but also that subsequent default on this wide definition is nearly universal.22 It seems only realistic in the light of their findings to expect many governments to take this route.

…

., and Luigi Zingales. 2004. Saving Capitalism from the Capitalists: Unleashing the Power of Financial Markets to Create Wealth and Spread Opportunity. Princeton: Princeton University Press. Ramsey, Frank P. 1928. “A Mathematical Theory of Saving.” Economic Journal 38:4, pp 543–49. Reinhardt, Carmen M., and Kenneth Rogoff. 2010. This Time Is Different: Eight Centuries of Financial Folly. Princeton: Princeton University Press. Rivoli, Pietra. 2005. The Travels of a T-Shirt in the Global Economy: An Economist Examines the Markets, Power, and Politics of World Trade. New York: Wiley. Roach, Stephen S. 2009. “Whither Capitalism?”

Bad Money: Reckless Finance, Failed Politics, and the Global Crisis of American Capitalism by Kevin Phillips

"World Economic Forum" Davos, Alan Greenspan, algorithmic trading, asset-backed security, bank run, banking crisis, Bear Stearns, Bernie Madoff, Black Swan, Bretton Woods, BRICs, British Empire, business cycle, buy and hold, collateralized debt obligation, computer age, corporate raider, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, currency peg, diversification, Doha Development Round, energy security, financial deregulation, financial engineering, financial innovation, fixed income, Francis Fukuyama: the end of history, George Gilder, Glass-Steagall Act, housing crisis, Hyman Minsky, imperial preference, income inequality, index arbitrage, index fund, interest rate derivative, interest rate swap, Joseph Schumpeter, junk bonds, Kenneth Rogoff, large denomination, Long Term Capital Management, low interest rates, market bubble, Martin Wolf, Menlo Park, Michael Milken, military-industrial complex, Minsky moment, mobile money, money market fund, Monroe Doctrine, moral hazard, mortgage debt, Myron Scholes, new economy, oil shale / tar sands, oil shock, old-boy network, peak oil, plutocrats, Ponzi scheme, profit maximization, prosperity theology / prosperity gospel / gospel of success, Renaissance Technologies, reserve currency, risk tolerance, risk/return, Robert Shiller, Ronald Reagan, Satyajit Das, Savings and loan crisis, shareholder value, short selling, sovereign wealth fund, stock buybacks, subprime mortgage crisis, The Chicago School, Thomas Malthus, too big to fail, trade route

Debt to foreigners expanded, as the enlargement of the annual U.S. current account deficit, in turn, required more and more foreign loans and investments to finance the things the United States needed to import—oil and manufactures—because our factories and oil fields no longer made or produced enough. The current account deficit had been $79 billion in 1990, then $420 billion in 2000, before mounting to $857 billion in 2006. Some economists thought that, too, constituted a potential menace. International economists Kenneth Rogoff and Maurice Obstfeld argued that “any sober policymaker or financial analyst ought to regard the United States’ current account deficit as a potential sword of Damocles hanging over the global economy.”22 Let me stipulate: there is a banal side to throwing around figures like $5 trillion or $6 trillion or even $857 billion.

…

Although OPEC’s recent take from high oil prices can be exaggerated by failure to recognize the erosion of the declining dollar, the annual receipts and estimates remain substantial: $506 billion in 2006, $508 billion in 2007, and $530 billion in 2008, according to the London-based Centre for Global Energy Studies. A different series issued by the U.S. Energy Information Administration put the 2007 figure at $658 billion and the 2008 estimate at $762 billion.50 “There’s never been anything like this on a sustained basis the way we’ve seen the last couple of years,” asserted Harvard economist Kenneth Rogoff. Oil prices “are not spiking; they’re just rising.”51 Over the next twenty years, and despite probable production plateaus or declines, the OPEC members in the Middle East, with most of the longer-lived reserves, can presumably expect receipts of $5 trillion to $10 trillion. FIGURE 5.3 Central Bank Reserves and Sovereign Wealth Funds: The Heavy Hitters, 2007 Source: International Monetary Fund official reserve assets.

The Price of Inequality: How Today's Divided Society Endangers Our Future by Joseph E. Stiglitz

affirmative action, Affordable Care Act / Obamacare, airline deregulation, Alan Greenspan, Andrei Shleifer, banking crisis, barriers to entry, Basel III, battle of ideas, Bear Stearns, behavioural economics, Berlin Wall, business cycle, capital controls, Carmen Reinhart, Cass Sunstein, central bank independence, collapse of Lehman Brothers, collective bargaining, colonial rule, corporate governance, Credit Default Swap, Daniel Kahneman / Amos Tversky, Dava Sobel, declining real wages, deskilling, electricity market, Exxon Valdez, Fall of the Berlin Wall, financial deregulation, financial innovation, Flash crash, framing effect, full employment, George Akerlof, Gini coefficient, Glass-Steagall Act, Great Leap Forward, income inequality, income per capita, indoor plumbing, inflation targeting, information asymmetry, invisible hand, jobless men, John Bogle, John Harrison: Longitude, John Markoff, John Maynard Keynes: Economic Possibilities for our Grandchildren, Kenneth Arrow, Kenneth Rogoff, London Interbank Offered Rate, lone genius, low interest rates, low skilled workers, Marc Andreessen, Mark Zuckerberg, market bubble, market fundamentalism, mass incarceration, medical bankruptcy, microcredit, moral hazard, mortgage tax deduction, negative equity, obamacare, offshore financial centre, paper trading, Pareto efficiency, patent troll, Paul Samuelson, Paul Volcker talking about ATMs, payday loans, Phillips curve, price stability, profit maximization, profit motive, public intellectual, purchasing power parity, race to the bottom, rent-seeking, reserve currency, Richard Thaler, Robert Shiller, Robert Solow, Ronald Coase, Ronald Reagan, Savings and loan crisis, search costs, shareholder value, short selling, Silicon Valley, Simon Kuznets, spectrum auction, Steve Jobs, stock buybacks, subprime mortgage crisis, technology bubble, The Chicago School, The Fortune at the Bottom of the Pyramid, The Myth of the Rational Market, The Spirit Level, The Wealth of Nations by Adam Smith, too big to fail, trade liberalization, Tragedy of the Commons, transaction costs, trickle-down economics, ultimatum game, uranium enrichment, very high income, We are the 99%, wealth creators, women in the workforce, zero-sum game

Like a good magician, a free-market economist succeeds by drawing spectators’ attention to what he wants them to see—the rabbit jumping out of the hat—while distracting their attention from other things—how the rabbit got into the hat in the first place. 6. Adam Smith, The Wealth of Nations (1776; New York: P. F. Collier, 1902), p. 207. 7. See Carmen Reinhart and Kenneth Rogoff, This Time Is Different: Eight Centuries of Financial Folly (Princeton: Princeton University Press, 2009). 8. A derivative is just a financial instrument the return to which is derived on the basis of something else, e.g., the performance of a stock or the price of oil or the value of a bond.

…

In a study with Scott Wallstein prepared while I was chairman of President Clinton’s Council of Economic Advisers: “Supporting Research and Development to Promote Economic Growth: The Federal Government’s Role,” Council of Economic Advisers, October 1995. 56. As measured, e.g., by the UNDP Human Development Indicators. See the discussion in the final section of this chapter. 57. Kenneth Rogoff and Carmen M. Reinhardt, This Time Is Different: Eight Centuries of Financial Folly (Princeton: Princeton University Press, 2009), describe hundreds of financial crises in the last eight hundred years, eighteen banking crises in the developed world since World War II alone. Earlier, the late Charles Kindleberger of MIT described repeated crises in his classic Manias, Panics, and Crashes: A History of Financial Crises (New York: Basic Books, 1978). 58.

…

If they had all moved to a flexible exchange rate system, would that, by itself, have been sufficient to restore the global economy to prosperity? I doubt it. 42. For a discussion of these bubbles and the repeated financial crises that are often associated with the bursting of the bubbles, see Charles Kindleberger, Manias, Panics, and Crashes: A History of Financial Crises (New York: Basic Books, 1978), and Kenneth Rogoff and Carmen M. Reinhardt, This Time Is Different: Eight Centuries of Financial Folly (Princeton: Princeton University Press, 2009). 43. Or, similarly, increasing margins in the purchase of stock (which act like a house down payment). Interestingly, in the tech bubbles of the 1990s, the possibility of increasing margin requirements was briefly discussed, but then evidently dismissed: perhaps the free marketers that dominated the Fed didn’t like this kind of interference with the wonders of the market.

Makers and Takers: The Rise of Finance and the Fall of American Business by Rana Foroohar

"Friedman doctrine" OR "shareholder theory", "World Economic Forum" Davos, accounting loophole / creative accounting, activist fund / activist shareholder / activist investor, additive manufacturing, Airbnb, Alan Greenspan, algorithmic trading, Alvin Roth, Asian financial crisis, asset allocation, bank run, Basel III, Bear Stearns, behavioural economics, Big Tech, bonus culture, Bretton Woods, British Empire, business cycle, buy and hold, call centre, Capital in the Twenty-First Century by Thomas Piketty, Carl Icahn, Carmen Reinhart, carried interest, centralized clearinghouse, clean water, collateralized debt obligation, commoditize, computerized trading, corporate governance, corporate raider, corporate social responsibility, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, crowdsourcing, data science, David Graeber, deskilling, Detroit bankruptcy, diversification, Double Irish / Dutch Sandwich, electricity market, Emanuel Derman, Eugene Fama: efficient market hypothesis, financial deregulation, financial engineering, financial intermediation, Ford Model T, Frederick Winslow Taylor, George Akerlof, gig economy, Glass-Steagall Act, Goldman Sachs: Vampire Squid, Gordon Gekko, greed is good, Greenspan put, guns versus butter model, High speed trading, Home mortgage interest deduction, housing crisis, Howard Rheingold, Hyman Minsky, income inequality, index fund, information asymmetry, interest rate derivative, interest rate swap, Internet of things, invisible hand, James Carville said: "I would like to be reincarnated as the bond market. You can intimidate everybody.", John Bogle, John Markoff, joint-stock company, joint-stock limited liability company, Kenneth Rogoff, Kickstarter, knowledge economy, labor-force participation, London Whale, Long Term Capital Management, low interest rates, manufacturing employment, market design, Martin Wolf, money market fund, moral hazard, mortgage debt, mortgage tax deduction, new economy, non-tariff barriers, offshore financial centre, oil shock, passive investing, Paul Samuelson, pensions crisis, Ponzi scheme, principal–agent problem, proprietary trading, quantitative easing, quantitative trading / quantitative finance, race to the bottom, Ralph Nader, Rana Plaza, RAND corporation, random walk, rent control, Robert Shiller, Ronald Reagan, Satyajit Das, Savings and loan crisis, scientific management, Second Machine Age, shareholder value, sharing economy, Silicon Valley, Silicon Valley startup, Snapchat, Social Responsibility of Business Is to Increase Its Profits, sovereign wealth fund, Steve Jobs, stock buybacks, subprime mortgage crisis, technology bubble, TED Talk, The Chicago School, the new new thing, The Spirit Level, The Wealth of Nations by Adam Smith, Tim Cook: Apple, Tobin tax, too big to fail, Tragedy of the Commons, trickle-down economics, Tyler Cowen: Great Stagnation, Vanguard fund, vertical integration, zero-sum game

On top of this, it’s quantitatively increasing market volatility and risk of the sort that wiped out $16 trillion in household wealth during the Great Recession.59 Evidence shows that the number of wealth-destroying financial crises has risen in tandem with financial sector growth over the last several decades. In their book This Time Is Different: Eight Centuries of Financial Folly, academics Carmen Reinhart and Kenneth Rogoff describe how the proportion of the world affected by banking crises (weighed by countries’ share of global GDP) rose from some 7.5 percent in 1971 to 11 percent in 1980 and to 32 percent in 2007.60 And economist Robert Aliber, in updating one of the seminal books on financial bubbles, the late Charles Kindleberger’s Manias, Panics, and Crashes: A History of Financial Crises, issued a grave warning in 2005, well before the 2008 meltdown: “The conclusion is unmistakable that financial failure has been more extensive and pervasive in the last thirty years than in any previous period.”61 This is a startling illustration of how finance has transitioned from an industry that encourages healthy risk taking to one that simply creates debt and spreads unproductive risk in the market system as a whole.

…

See also Atif Mian and Amir Sufi, House of Debt: How They (and You) Caused the Great Recession and How We Can Prevent It from Happening Again (Chicago: University of Chicago Press, 2014). 19. Raghuram G. Rajan, Fault Lines: How Hidden Fractures Still Threaten the World Economy (Princeton, NJ: Princeton University Press, 2010), 21. 20. Carmen M. Reinhart and Kenneth Rogoff, This Time Is Different: Eight Centuries of Financial Folly (Princeton, NJ: Princeton University Press, 2009). 21. McKinsey Global Institute, “Debt and (Not Much) Deleveraging,” February 2015, 98–99. 22. Greenwood and Scharfstein, “The Growth of Finance,” 21. 23. Financial efficiency is defined here as the amount of money and engagement that finance provides to Main Street, rather than to the capital markets themselves. 24.

…

Rajan, Raghuram G. Fault Lines: How Hidden Fractures Still Threaten the World Economy. Princeton, NJ: Princeton University Press, 2010. Reich, Robert B. Supercapitalism: The Transformation of Business, Democracy, and Everyday Life. New York: Alfred A. Knopf, 2007. Reinhart, Carmen M., and Kenneth S. Rogoff. This Time Is Different: Eight Centuries of Financial Folly. Princeton, NJ: Princeton University Press, 2009. Roth, Alvin E. Who Gets What—and Why: The New Economics of Matchmaking and Market Design. Boston: Houghton Mifflin Harcourt, 2015. Rothkopf, David. Power, Inc.: The Epic Rivalry Between Big Business and Government—and the Reckoning That Lies Ahead.

MegaThreats: Ten Dangerous Trends That Imperil Our Future, and How to Survive Them by Nouriel Roubini

"World Economic Forum" Davos, 2021 United States Capitol attack, 3D printing, 9 dash line, AI winter, AlphaGo, artificial general intelligence, asset allocation, assortative mating, autonomous vehicles, bank run, banking crisis, basic income, Bear Stearns, Big Tech, bitcoin, Bletchley Park, blockchain, Boston Dynamics, Bretton Woods, British Empire, business cycle, business process, call centre, carbon tax, Carmen Reinhart, cashless society, central bank independence, collateralized debt obligation, Computing Machinery and Intelligence, coronavirus, COVID-19, creative destruction, credit crunch, crony capitalism, cryptocurrency, currency manipulation / currency intervention, currency peg, data is the new oil, David Ricardo: comparative advantage, debt deflation, decarbonisation, deep learning, DeepMind, deglobalization, Demis Hassabis, democratizing finance, Deng Xiaoping, disintermediation, Dogecoin, Donald Trump, Elon Musk, en.wikipedia.org, energy security, energy transition, Erik Brynjolfsson, Ethereum, ethereum blockchain, eurozone crisis, failed state, fake news, family office, fiat currency, financial deregulation, financial innovation, financial repression, fixed income, floating exchange rates, forward guidance, Fractional reserve banking, Francis Fukuyama: the end of history, full employment, future of work, game design, geopolitical risk, George Santayana, Gini coefficient, global pandemic, global reserve currency, global supply chain, GPS: selective availability, green transition, Greensill Capital, Greenspan put, Herbert Marcuse, high-speed rail, Hyman Minsky, income inequality, inflation targeting, initial coin offering, Intergovernmental Panel on Climate Change (IPCC), Internet of things, invention of movable type, Isaac Newton, job automation, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, junk bonds, Kenneth Rogoff, knowledge worker, Long Term Capital Management, low interest rates, low skilled workers, low-wage service sector, M-Pesa, margin call, market bubble, Martin Wolf, mass immigration, means of production, meme stock, Michael Milken, middle-income trap, Mikhail Gorbachev, Minsky moment, Modern Monetary Theory, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, mortgage debt, Mustafa Suleyman, Nash equilibrium, natural language processing, negative equity, Nick Bostrom, non-fungible token, non-tariff barriers, ocean acidification, oil shale / tar sands, oil shock, paradox of thrift, pets.com, Phillips curve, planetary scale, Ponzi scheme, precariat, price mechanism, price stability, public intellectual, purchasing power parity, quantitative easing, race to the bottom, Ralph Waldo Emerson, ransomware, Ray Kurzweil, regulatory arbitrage, reserve currency, reshoring, Robert Shiller, Ronald Reagan, Salesforce, Satoshi Nakamoto, Savings and loan crisis, Second Machine Age, short selling, Silicon Valley, smart contracts, South China Sea, sovereign wealth fund, Stephen Hawking, TED Talk, The Great Moderation, the payments system, Thomas L Friedman, TikTok, too big to fail, Turing test, universal basic income, War on Poverty, warehouse robotics, Washington Consensus, Watson beat the top human players on Jeopardy!, working-age population, Yogi Berra, Yom Kippur War, zero-sum game, zoonotic diseases

For the record, I don’t hang my hat on these inflation expectations. They are wrong most of the time, usually because they fail to anticipate the kinds of aggregate supply shocks that loom directly in our path. Warning signs resist accurate interpretation. Even experts require course corrections. Harvard professor and former IMF chief economist Kenneth Rogoff tried to ease concern in a Financial Times op-ed with the title, “Don’t Panic: A Little Inflation Is No Bad Thing.” He reckoned that after a decade of lower than expected inflation, a pendulum swing in the other direction might be welcome. “US inflation today is much more like good news than bad,” Rogoff wrote.

…

But It Brings Some Big Risks, Too,” Washington Post, February 4, 2021, https://www.washingtonpost.com/opinions/2021/02/04/larry-summers-biden-covid-stimulus/. 26. Gwynn Guilford, “A Key Gauge of Future Inflation Is Easing,” Wall Street Journal, July 26, 2021, https://www.wsj.com/articles/a-key-gauge-of-future-inflation-is-easing-11627291800?tpl=centralbanking. 27. Kenneth Rogoff, “Don’t Panic: A Little Inflation Is No Bad Thing,” Financial Times, July 16, 2021, https://www.ft.com/content/a7c101be-7361-4307-981d-b8edf6d002be. 28. Lawrence Goodman, “Inflation Fears Offers the Fed a Chance to Modernize with Money,” Center for Financial Stability, April 26, 2021, http://www.centerforfinancialstability.org/research/Modernize_Money_042621.pdf 29.

After the Music Stopped: The Financial Crisis, the Response, and the Work Ahead by Alan S. Blinder

Affordable Care Act / Obamacare, Alan Greenspan, asset-backed security, bank run, banking crisis, banks create money, Bear Stearns, book value, break the buck, Carmen Reinhart, central bank independence, collapse of Lehman Brothers, collateralized debt obligation, conceptual framework, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, currency risk, Detroit bankruptcy, diversification, double entry bookkeeping, eurozone crisis, facts on the ground, financial engineering, financial innovation, fixed income, friendly fire, full employment, Glass-Steagall Act, hiring and firing, housing crisis, Hyman Minsky, illegal immigration, inflation targeting, interest rate swap, Isaac Newton, junk bonds, Kenneth Rogoff, liquidity trap, London Interbank Offered Rate, Long Term Capital Management, low interest rates, market bubble, market clearing, market fundamentalism, McMansion, Minsky moment, money market fund, moral hazard, naked short selling, new economy, Nick Leeson, Northern Rock, Occupy movement, offshore financial centre, Paul Volcker talking about ATMs, price mechanism, proprietary trading, quantitative easing, Ralph Waldo Emerson, Robert Shiller, Robert Solow, Ronald Reagan, Savings and loan crisis, shareholder value, short selling, South Sea Bubble, statistical model, the payments system, time value of money, too big to fail, vertical integration, working-age population, yield curve, Yogi Berra

Instead, the euro kept Greece expensive, and antiausterity riots scared tourists away. The third critical difference between the United States and Europe is perhaps too obvious to state: They had to deal with Greece; we didn’t. The Greek situation is, if you’ll pardon the Latin, sui generis. Greece has a dismal fiscal history. Economists Carmen Reinhart and Kenneth Rogoff found that Greece has been in default on its public debt roughly 50 percent of the time since gaining independence in the 1830s! More recently, Greece’s budget deficits were large before the crisis and huge thereafter. The Greeks also turn out to be pretty poor tax collectors—some would say they hardly try.

…

CNBC, April 30, 2009. www.cnbc.com/id/30502091?slide=1. Pozsar, Zoltan, Tobias Adrian, Adam Ashcraft, and Hayley Boesky. “Shadow Banking.” Federal Reserve Bank of New York Staff Report 458 (July 2010). Protess, Ben. “Mortgage Executive Receives 30-Year Sentence.” New York Times, June 30, 2011. Reinhart, Carmen M., and Kenneth Rogoff. This Time Is Different: Eight Centuries of Financial Folly. Princeton, N.J.: Princeton University Press, 2009. Rogers, Will. Sanity Is Where You Find It. Selected and edited by Donald Day. Boston, Mass.: Houghton Mifflin, 1955. Rogoff, Kenneth. “The Bullets Yet to Be Fired to Stop the Crisis.”

Expected Returns: An Investor's Guide to Harvesting Market Rewards by Antti Ilmanen

Alan Greenspan, Andrei Shleifer, asset allocation, asset-backed security, availability heuristic, backtesting, balance sheet recession, bank run, banking crisis, barriers to entry, behavioural economics, Bernie Madoff, Black Swan, Bob Litterman, bond market vigilante , book value, Bretton Woods, business cycle, buy and hold, buy low sell high, capital asset pricing model, capital controls, carbon credits, Carmen Reinhart, central bank independence, classic study, collateralized debt obligation, commoditize, commodity trading advisor, corporate governance, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency risk, deal flow, debt deflation, deglobalization, delta neutral, demand response, discounted cash flows, disintermediation, diversification, diversified portfolio, dividend-yielding stocks, equity premium, equity risk premium, Eugene Fama: efficient market hypothesis, fiat currency, financial deregulation, financial innovation, financial intermediation, fixed income, Flash crash, framing effect, frictionless, frictionless market, G4S, George Akerlof, global macro, global reserve currency, Google Earth, high net worth, hindsight bias, Hyman Minsky, implied volatility, income inequality, incomplete markets, index fund, inflation targeting, information asymmetry, interest rate swap, inverted yield curve, invisible hand, John Bogle, junk bonds, Kenneth Rogoff, laissez-faire capitalism, law of one price, London Interbank Offered Rate, Long Term Capital Management, loss aversion, low interest rates, managed futures, margin call, market bubble, market clearing, market friction, market fundamentalism, market microstructure, mental accounting, merger arbitrage, mittelstand, moral hazard, Myron Scholes, negative equity, New Journalism, oil shock, p-value, passive investing, Paul Samuelson, pension time bomb, performance metric, Phillips curve, Ponzi scheme, prediction markets, price anchoring, price stability, principal–agent problem, private sector deleveraging, proprietary trading, purchasing power parity, quantitative easing, quantitative trading / quantitative finance, random walk, reserve currency, Richard Thaler, risk free rate, risk tolerance, risk-adjusted returns, risk/return, riskless arbitrage, Robert Shiller, savings glut, search costs, selection bias, seminal paper, Sharpe ratio, short selling, sovereign wealth fund, statistical arbitrage, statistical model, stochastic volatility, stock buybacks, stocks for the long run, survivorship bias, systematic trading, tail risk, The Great Moderation, The Myth of the Rational Market, too big to fail, transaction costs, tulip mania, value at risk, volatility arbitrage, volatility smile, working-age population, Y2K, yield curve, zero-coupon bond, zero-sum game

Reinhart, Carmen M. (2010), “This time is different chartbook: Country histories on debt, default, and financial crises,” NBER working paper 15815. Reinhart, Carmen M.; and Kenneth S. Rogoff (2008), “This time is different: A panoramic view of eight centuries of financial crises,” NBER working paper 13882. Reinhart, Carmen M.; and Kenneth S. Rogoff (2009), This Time is Different: Eight Centuries of Financial Folly, Princeton, NJ: Princeton University Press. Reinhart, Carmen M.; and Kenneth S. Rogoff (2010), “From financial crash to debt crisis,” NBER working paper 15795, forthcoming in American Economic Review. Ribeiro, Ruy; and Jan Loeys (2006), “Exploiting cross-market momentum,” Investment Strategies 14, J.P.

…

Sustained inflation only became pervasive in the 20th century: Median inflation rate (5-year moving average) for all countries, 1500–2010. Sources: Carmen M. Reinhart and Kenneth S. Rogoff (2008), “This time is different: A panoramic view of eight centuries of financial crises,” NBER working paper 13882, March 2008. Carmen M. Reinhart (2010), “This time is different chartbook: Country histories on debt, default, and financial crises,” NBER working paper 15815. Reproduced by permission of Carmen M. Reinhart and Kenneth S. Rogoff. During the gold standard (Britain adopted it in 1717, other developed countries in the 19th century), inflations and deflations took turns with no persistence, and long-run inflation expectations were likely near zero most of the time.

…

After a quarter-century when bearing duration risk was amply rewarded, Treasuries may provide neither safety nor performance in the coming decade. Figure 27.6. Global perspective on inflation and external default histories. Source: Carmen M. Reinhart and Kenneth S. Rogoff (2008), “This time is different: A panoramic view of eight centuries of financial crises,” NBER working paper 13882. Reproduced by permission of Carmen M. Reinhart and Kenneth S. Rogoff. Figure 27.7. Sovereign CDS spreads, July 2007–July 2010. Source: Bloomberg. Finally, the last innings of the debt supercycle may arrive even before the demographic costs balloon. Market participants are turning their focus on the magnitude of the fiscal problem just when G7 economies face extraordinary borrowing needs and sharply rising debt/GDP ratios.

Straight Talk on Trade: Ideas for a Sane World Economy by Dani Rodrik

3D printing, airline deregulation, Asian financial crisis, bank run, barriers to entry, behavioural economics, Berlin Wall, Bernie Sanders, blue-collar work, Bretton Woods, BRICs, business cycle, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, carbon tax, Carmen Reinhart, carried interest, central bank independence, centre right, collective bargaining, conceptual framework, continuous integration, corporate governance, corporate social responsibility, currency manipulation / currency intervention, David Ricardo: comparative advantage, deindustrialization, Donald Trump, endogenous growth, Eugene Fama: efficient market hypothesis, eurozone crisis, export processing zone, failed state, financial deregulation, financial innovation, financial intermediation, financial repression, floating exchange rates, full employment, future of work, general purpose technology, George Akerlof, global value chain, income inequality, inflation targeting, information asymmetry, investor state dispute settlement, invisible hand, Jean Tirole, Kenneth Rogoff, low interest rates, low skilled workers, manufacturing employment, market clearing, market fundamentalism, meta-analysis, moral hazard, Nelson Mandela, new economy, offshore financial centre, open borders, open economy, open immigration, Pareto efficiency, postindustrial economy, precautionary principle, price stability, public intellectual, pushing on a string, race to the bottom, randomized controlled trial, regulatory arbitrage, rent control, rent-seeking, Richard Thaler, Robert Gordon, Robert Shiller, Ronald Reagan, Sam Peltzman, Silicon Valley, Solyndra, special economic zone, spectrum auction, Steven Pinker, tacit knowledge, The Rise and Fall of American Growth, the scientific method, The Wealth of Nations by Adam Smith, Thomas L Friedman, too big to fail, total factor productivity, trade liberalization, transaction costs, Tyler Cowen, unorthodox policies, Washington Consensus, World Values Survey, zero-sum game, éminence grise

Economics Hijacked When the stakes are high, it is no surprise that battling political opponents use whatever support they can garner from economists and other researchers. That is what happened when conservative American politicians and European Union officials latched on to the work of two Harvard professors—Carmen Reinhart and Kenneth Rogoff—to justify their support of fiscal austerity.9 Reinhart and Rogoff had published a paper that appeared to show that public-debt levels above 90 percent of GDP do significant damage to economic growth. The paper was criticized by three economists from the University of Massachusetts at Amherst, who argued their findings were brittle.10 They had found a relatively minor spreadsheet error.

…

New York Times, Opinion Pages, January 26, 2016, https://www.nytimes.com/2016/01/26/opinion/whats-our-duty-to-the-people-globalization-leaves-behind.html?_r=2. 8. Fabrice Defever and Alejandro Riaño, “China’s Pure Exporter Subsidies,” Centre for Economic Performance Discussion Paper No. 1182, London School of Economics and Political Science, December 2012. 9. The original paper is Carmen M. Reinhart and Kenneth S. Rogoff, “Growth in the Time of Debt,” NBER Working Paper No. 15639, January 2010. 10. Thomas Herndon, Michael Ash, and Robert Pollin, “Does High Public Debt Consistently Stifle Economic Growth? A Critique of Reinhart and Rogoff,” Cambridge Journal of Economics, vol. 38(2), 2014: 257–279. 11. Alberto F.

Destined for War: America, China, and Thucydides's Trap by Graham Allison

9 dash line, anti-communist, Berlin Wall, borderless world, Bretton Woods, British Empire, capital controls, Carmen Reinhart, conceptual framework, cuban missile crisis, currency manipulation / currency intervention, Deng Xiaoping, disruptive innovation, Donald Trump, Dr. Strangelove, escalation ladder, facts on the ground, false flag, Flash crash, Francis Fukuyama: the end of history, game design, George Santayana, Great Leap Forward, guns versus butter model, Haber-Bosch Process, Herman Kahn, high-speed rail, industrial robot, Internet of things, Kenneth Rogoff, liberal world order, long peace, Mark Zuckerberg, megacity, megaproject, middle-income trap, Mikhail Gorbachev, Monroe Doctrine, mutually assured destruction, Nelson Mandela, one-China policy, Paul Samuelson, Peace of Westphalia, public intellectual, purchasing power parity, RAND corporation, Ronald Reagan, Scramble for Africa, selection bias, Silicon Valley, Silicon Valley startup, South China Sea, special economic zone, spice trade, Suez canal 1869, synthetic biology, TED Talk, the rule of 72, The Wealth of Nations by Adam Smith, too big to fail, trade route, UNCLOS, Washington Consensus, zero-sum game

Some observers claim the twenty-first century is so different from the past that lessons from previous experience are no longer relevant. To be sure, it is difficult to find precedents for current levels of economic integration, globalization, and ubiquitous worldwide communication, or global threats from climate disruption to violent Islamic extremism. But as my colleagues Carmen Reinhart and Kenneth Rogoff remind us in their analysis of 350 financial crises over the past eight centuries, many previous generations have imagined that This Time Is Different. 56 Reinhart and Rogoff side with Thucydides in reasoning that, as long as men are men, we can anticipate recurring patterns in human affairs.

…

For a definitive account of Soviet and American interventions in the Third World during this era, see Odd Arne Westad, The Global Cold War: Third World Interventions and the Making of Our Times (Cambridge: Cambridge University Press, 2005). For an illuminating narrative history of American covert operations in the Cold War that were aimed at foreign regime change, see Stephen Kinzer, Overthrow: America’s Century of Regime Change from Hawaii to Iraq (New York: Times Books, 2006), 111–216. [back] 56. Carmen Reinhart and Kenneth Rogoff, This Time Is Different: Eight Centuries of Financial Folly (Princeton, NJ: Princeton University Press, 2009). [back] 57. See Howard Weinroth, “Norman Angell and The Great Illusion: An Episode in Pre-1914 Pacifism,” Historical Journal 17, no. 3 (September 1974), 551–74. [back] 58. Harvard Nuclear Study Group, Living with Nuclear Weapons (Cambridge, MA: Harvard University Press, 1983), 43–44.

Science Fictions: How Fraud, Bias, Negligence, and Hype Undermine the Search for Truth by Stuart Ritchie

Albert Einstein, anesthesia awareness, autism spectrum disorder, Bayesian statistics, Black Lives Matter, Carmen Reinhart, Cass Sunstein, Charles Babbage, citation needed, Climatic Research Unit, cognitive dissonance, complexity theory, coronavirus, correlation does not imply causation, COVID-19, crowdsourcing, data science, deindustrialization, Donald Trump, double helix, en.wikipedia.org, epigenetics, Estimating the Reproducibility of Psychological Science, fake news, Goodhart's law, Growth in a Time of Debt, Helicobacter pylori, Higgs boson, hype cycle, Kenneth Rogoff, l'esprit de l'escalier, Large Hadron Collider, meta-analysis, microbiome, Milgram experiment, mouse model, New Journalism, ocean acidification, p-value, phenotype, placebo effect, profit motive, publication bias, publish or perish, quantum entanglement, race to the bottom, randomized controlled trial, recommendation engine, rent-seeking, replication crisis, Richard Thaler, risk tolerance, Ronald Reagan, Scientific racism, selection bias, Silicon Valley, Silicon Valley startup, social distancing, Stanford prison experiment, statistical model, stem cell, Steven Pinker, TED Talk, Thomas Bayes, twin studies, Tyler Cowen, University of East Anglia, Wayback Machine

Just as physicists would love to discover a new law (or a way to break the ones we already know), and just as mathematicians work endlessly to prove their theorems, many social scientists, particularly economists, long to discover a stylised fact that can be associated with their name – and that the people who make important decisions can easily keep in mind. When they published a major paper in 2010, the economists Carmen Reinhart and Kenneth Rogoff thought they’d hit the stylised-fact jackpot. For two years, politicians had been frantically trying to address the fallout of the 2008 financial crisis and the ensuing Great Recession. Amid all the conflicting advice, Reinhart and Rogoff’s paper, entitled ‘Growth in a Time of Debt’, was a godsend, providing strong evidence to recommend one particular course of economic action: austerity.2 Reinhart and Rogoff had studied the debt-to-GDP ratio – the relationship between what a country owes to its creditors (its public debt, which, perhaps confusingly, is also known as its government debt or its sovereign debt) and what new goods and services it can produce (its Gross Domestic Product).

…

Daniel Hirschman, ‘Stylized Facts in the Social Sciences’, Sociological Science 3 (2016): pp. 604–26; https://doi.org/10.15195/v3.a26 2.  The study was an online ‘working paper’ for a while (as is normal in economics, as we’ll see in the final chapter), but it was eventually officially published as Carmen M. Reinhart and Kenneth S. Rogoff, ‘Growth in a Time of Debt’, American Economic Review 100, no. 2 (May 2010): pp. 573–78; https://doi.org/10.1257/aer.100.2.573 3.  Osborne: George Osborne, ‘Mais Lecture – A New Economic Model’, 24 Feb. 2010; https://conservative-speeches.sayit.mysociety.org/speech/601526; Republican members: United States Senate Committee on the Budget, ‘Sessions, Ryan Issue Joint Statement On Jobs Report, Call For Senate Action On Budget’, 8 July 2011; https://www.budget.senate.gov/chairman/newsroom/press/sessions-ryan-issue-joint-statement-on-jobs-report-call-for-senate-action-on-budget 4.  

…

., ‘Does High Public Debt Consistently Stifle Economic Growth? A Critique of Reinhart and Rogoff’, Cambridge Journal of Economics 38, no. 2 (April 2013): pp. 257–79; https://doi.org/10.1093/cje/bet075 6.  Reinhart and Rogoff admitted the Excel error, though they didn’t agree with the critics on many of their other points: Carmen M. Reinhart & Kenneth S. Rogoff, ‘Reinhart-Rogoff Response to Critique’, Wall Street Journal, 16 April 2013; https://blogs.wsj.com/economics/2013/04/16/reinhart-rogoff-response-to- critique/ 7.  Herndon et al., ‘High Public Debt’, p. 14. 8.  Betsey Stevenson & Justin Wolfers, ‘Refereeing Reinhart-Rogoff Debate’, Bloomberg Opinion, 28 April 2013; https://www.bloomberg.com/opinion/articles/2013-04-28/refereeing-the-reinhart-rogoff-debate 9.  

An Economic History of the Twentieth Century by J. Bradford Delong

affirmative action, Alan Greenspan, Andrei Shleifer, ASML, asset-backed security, Ayatollah Khomeini, banking crisis, Bear Stearns, Bretton Woods, British Empire, business cycle, buy and hold, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, centre right, collapse of Lehman Brothers, collective bargaining, colonial rule, coronavirus, cotton gin, COVID-19, creative destruction, crowdsourcing, cryptocurrency, cuban missile crisis, deindustrialization, demographic transition, Deng Xiaoping, Donald Trump, en.wikipedia.org, ending welfare as we know it, endogenous growth, Fairchild Semiconductor, fake news, financial deregulation, financial engineering, financial repression, flying shuttle, Ford Model T, Ford paid five dollars a day, Francis Fukuyama: the end of history, full employment, general purpose technology, George Gilder, German hyperinflation, global value chain, Great Leap Forward, Gunnar Myrdal, Haber-Bosch Process, Hans Rosling, hedonic treadmill, Henry Ford's grandson gave labor union leader Walter Reuther a tour of the company’s new, automated factory…, housing crisis, Hyman Minsky, income inequality, income per capita, industrial research laboratory, interchangeable parts, Internet Archive, invention of agriculture, invention of the steam engine, It's morning again in America, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Joseph Schumpeter, Kenneth Rogoff, labor-force participation, land reform, late capitalism, Les Trente Glorieuses, liberal capitalism, liquidity trap, Long Term Capital Management, low interest rates, manufacturing employment, market bubble, means of production, megacity, Menlo Park, Mikhail Gorbachev, mortgage debt, mutually assured destruction, Neal Stephenson, occupational segregation, oil shock, open borders, open economy, Paul Samuelson, Pearl River Delta, Phillips curve, plutocrats, price stability, Productivity paradox, profit maximization, public intellectual, quantitative easing, Ralph Waldo Emerson, restrictive zoning, rising living standards, road to serfdom, Robert Gordon, Robert Solow, rolodex, Ronald Coase, Ronald Reagan, savings glut, secular stagnation, Silicon Valley, Simon Kuznets, social intelligence, Stanislav Petrov, strikebreaker, structural adjustment programs, Suez canal 1869, surveillance capitalism, The Bell Curve by Richard Herrnstein and Charles Murray, The Chicago School, The Great Moderation, The Nature of the Firm, The Rise and Fall of American Growth, too big to fail, transaction costs, transatlantic slave trade, transcontinental railway, TSMC, union organizing, vertical integration, W. E. B. Du Bois, Wayback Machine, Yom Kippur War

But those costs were trivial relative to the damage avoided by maintaining full employment and growth through what was, elsewhere, the Great Recession. During the Great Recession, China gained from five to ten extra years in its race to catch up to the global north. We can begin to theorize explanations for such irrationality. Some highly capable and competent economists, such as Carmen M. Reinhart and Kenneth Rogoff, saw the dangers of the financial crisis but greatly exaggerated the risks of public spending to boost employment in its aftermath.32 Other highly capable and competent economists, including Federal Reserve chair Bernanke, understood the importance of keeping interest rates low but overestimated the effectiveness of additional monetary-policy tools such as quantitative easing.33 Still others, perhaps less capable and competent, like me, understood that expansionary monetary policies would not be enough but, because we had looked at global imbalances the wrong way, missed the principal source of risk—US financial misregulation—and found ourselves still trying to catch up to the situation in order to give accurate policy advice in real time.34 In hindsight, technocrats’ errors of judgment and failures of communication seem to me a large part of how events unfolded so disastrously—if we economists had spoken up sooner about what we knew about depressions and their cure, had been more convincing on the issues where we were right, and had been better at recognizing where we were wrong, the situation today might be considerably better.

…

Olivier Blanchard and Lawrence Summers, “Hysteresis and the European Unemployment Problem,” National Bureau of Economic Research (NBER) working paper 1950, NBER Macroeconomics Annual 1 (1986): 15–78, available at NBER, www.nber.org/papers/w1950. 8. The rough consensus is represented by Ben Bernanke, “Japanese Monetary Policy: A Case of Self-Induced Paralysis?,” Princeton University, December 1999, www.princeton.edu/~pkrugman/bernanke_paralysis.pdf; Kenneth Rogoff, “Comment on Krugman,” Brookings Papers on Economic Activity 2 (1998): 194–199, www.brookings.edu/wp-content/uploads/1998/06/1998b_bpea_krugman_dominquez_rogoff.pdf. 9. Raghuram Rajan, “Has Financial Development Made the World Riskier?,” in The Greenspan Era: Lesson for the Future, Kansas City: Federal Reserve Bank of Kansas City, 2005, 313–369, www.kansascityfed.org/documents/3326/PDF-Rajan2005.pdf.

…

Carol Loomis, “Robert Rubin on the Job He Never Wanted,” Fortune, November 26, 2007, available at Boston University Economics Department, www.bu.edu/econ/files/2011/01/Loomis.pdf. 13. See, for example, Chris Giles, “Harvard President Warns on Global Imbalances,” Financial Times, January 28, 2006, www.ft.com/content/f925a9e0-9035-11da-9e7e-0000779e2340; Maurice Obstfeld and Kenneth Rogoff, “The Unsustainable U.S. Current Account Position Revisited,” in G7 Current Account Imbalances: Sustainability and Adjustment, ed. Richard Clarida, Chicago: University of Chicago Press, 2007, 339–375, available at National Bureau of Economic Research, www.nber.org/system/files/chapters/c0127/c0127.pdf. 14.

Red Flags: Why Xi's China Is in Jeopardy by George Magnus

"World Economic Forum" Davos, 3D printing, 9 dash line, Admiral Zheng, AlphaGo, Asian financial crisis, autonomous vehicles, balance sheet recession, banking crisis, Bear Stearns, Bretton Woods, Brexit referendum, BRICs, British Empire, business process, capital controls, carbon footprint, Carmen Reinhart, cloud computing, colonial exploitation, corporate governance, crony capitalism, currency manipulation / currency intervention, currency peg, demographic dividend, demographic transition, Deng Xiaoping, Doha Development Round, Donald Trump, financial deregulation, financial innovation, financial repression, fixed income, floating exchange rates, full employment, general purpose technology, Gini coefficient, global reserve currency, Great Leap Forward, high net worth, high-speed rail, hiring and firing, Hyman Minsky, income inequality, industrial robot, information security, Internet of things, invention of movable type, Joseph Schumpeter, Kenneth Rogoff, Kickstarter, labour market flexibility, labour mobility, land reform, Malacca Straits, means of production, megacity, megaproject, middle-income trap, Minsky moment, money market fund, moral hazard, non-tariff barriers, Northern Rock, offshore financial centre, old age dependency ratio, open economy, peer-to-peer lending, pension reform, price mechanism, purchasing power parity, regulatory arbitrage, rent-seeking, reserve currency, rising living standards, risk tolerance, Shenzhen special economic zone , smart cities, South China Sea, sovereign wealth fund, special drawing rights, special economic zone, speech recognition, The Wealth of Nations by Adam Smith, total factor productivity, trade route, urban planning, vertical integration, Washington Consensus, women in the workforce, working-age population, zero-sum game

However, the almost fourfold rise in the old-age dependency ratio will subject China to a substantial fiscal burden. The development of coping mechanisms can help to mitigate the burden, but China will also have to make difficult decisions affecting taxation and spending to keep public debt on an even keel. In their seminal work in the wake of the financial crisis, Carmen Reinhart and Kenneth Rogoff asserted that economic growth slows sharply, or even falls, once the ratio of public debt to GDP breaches 90 per cent.17 While the mechanical implication here has been disputed, and may in any case be uncertain in a state-driven economy, economists are right to say that the debt to GDP ratio cannot increase continuously without important economic implications, even if precise thresholds of risk are hard to define.

…

‘China Plans Immigration Agency to Lure Overseas Talent’, Bloomberg, 18 July 2016, <https://www.bloomberg.com/news/articles/2016-07-18/china-said-to-create-new-office-to-lure-overseas-work-talent>. 16. ‘China 2030’, World Bank and Development Research Center of the State Council, 2013. 17. Carmen M. Reinhart and Kenneth S. Rogoff, This Time Is Different: Eight Centuries of Financial Folly, Princeton University Press, 2009. 18. IMF, ‘Older and Smaller’, Finance and Development, vol. 53, no. 1, March 2016. 19. IMF, Fiscal Monitor, October 2016. 20. Hu Jiye, China University of Political Science and Law, cited in Wynne Wang, ‘The Silver Age: China’s Aging Population’, Cheung Kong Graduate School of Business (CKGSB) Knowledge, 17 October 2016. 21.

Who Needs the Fed?: What Taylor Swift, Uber, and Robots Tell Us About Money, Credit, and Why We Should Abolish America's Central Bank by John Tamny

Airbnb, Alan Greenspan, Apollo 13, bank run, Bear Stearns, Bernie Madoff, bitcoin, Bretton Woods, business logic, buy and hold, Carl Icahn, Carmen Reinhart, corporate raider, correlation does not imply causation, cotton gin, creative destruction, Credit Default Swap, crony capitalism, crowdsourcing, Donald Trump, Downton Abbey, Fairchild Semiconductor, fiat currency, financial innovation, Fractional reserve banking, full employment, George Gilder, Glass-Steagall Act, Home mortgage interest deduction, Jeff Bezos, job automation, Joseph Schumpeter, junk bonds, Kenneth Rogoff, Kickstarter, Larry Ellison, liquidity trap, low interest rates, Mark Zuckerberg, market bubble, Michael Milken, Money creation, money market fund, moral hazard, mortgage tax deduction, NetJets, offshore financial centre, oil shock, peak oil, Peter Thiel, Phillips curve, price stability, profit motive, quantitative easing, race to the bottom, Ronald Reagan, self-driving car, sharing economy, Silicon Valley, Silicon Valley startup, Solyndra, Steve Jobs, The Wealth of Nations by Adam Smith, too big to fail, Travis Kalanick, Uber for X, War on Poverty, yield curve

It did not matter what the Federal Reserve said.1 In 1933, FDR made the decision to devalue the dollar from 1/20th of an ounce of gold to 1/35th of an ounce.2 Forgetting the lesson of the early 1920s, when the integrity of the dollar was maintained, Roosevelt devalued the dollar and thereby marked the first time the United States defaulted on its debt. As Carmen Reinhart and Kenneth Rogoff describe in This Time Is Different (2009), “The abrogation of the gold clause in the United States in 1933, which meant that public debts would be repaid in fiat currency rather than gold, constitutes a restricting of nearly all the government’s domestic debt.”3 With the United States heavily in debt thanks to spending that was logically failing to stimulate the economy, FDR reduced the value of the dollars being returned to holders of U.S. debt.

…

John Balassi and Josie Cox, “Apple Wows Market with Record $17 Billion Bond Deal,” Reuters, April 30, 2013. 4. Smith, Dead Bank Walking, 163. 5. Ibid. CHAPTER TWENTY 1. Amity Shlaes, The Forgotten Man: A New History of the Great Depression (New York: HarperCollins, 2007), 147. My emphasis. 2. Lewis, Gold: The Once and Future Money. 3. Carmen M. Reinhart and Kenneth S. Rogoff, This Time Is Different: Eight Centuries of Financial Folly (Princeton, N.J.: Princeton University Press, 2009). 4. Thiel, Zero to One, 44. 5. Shlaes, Forgotten Man, 148. 6. Eric Rauchway, The Money Makers: How Roosevelt and Keynes Ended the Depression, Defeated Facism, and Secured a Prosperous Peace (New York: Basic Books, 2015). 7.

Phil Thornton by The Great Economists Ten Economists whose thinking changed the way we live-FT Publishing International (2014)

Alan Greenspan, availability heuristic, behavioural economics, Berlin Wall, bitcoin, Bretton Woods, British Empire, business cycle, business process, call centre, capital controls, Cass Sunstein, choice architecture, cognitive bias, collapse of Lehman Brothers, Corn Laws, creative destruction, Daniel Kahneman / Amos Tversky, David Ricardo: comparative advantage, double helix, endogenous growth, endowment effect, Eugene Fama: efficient market hypothesis, Fall of the Berlin Wall, fiat currency, financial deregulation, fixed income, Ford Model T, full employment, hindsight bias, income inequality, inflation targeting, invisible hand, Isaac Newton, John Maynard Keynes: Economic Possibilities for our Grandchildren, joint-stock company, Kenneth Arrow, Kenneth Rogoff, Kickstarter, liquidity trap, loss aversion, mass immigration, means of production, mental accounting, Myron Scholes, paradox of thrift, Pareto efficiency, Paul Samuelson, Post-Keynesian economics, price mechanism, pushing on a string, quantitative easing, Richard Thaler, road to serfdom, Ronald Coase, Ronald Reagan, school vouchers, Simon Kuznets, The Chicago School, The Wealth of Nations by Adam Smith, Thomas Malthus, Toyota Production System, trade route, transaction costs, unorthodox policies, Vilfredo Pareto, women in the workforce

His work on revealed preferences is central to understanding consumer demand while his overlapping generations model still underpins the increasingly fraught debate over funding ageing populations. Samuelson’s ideas on trade still inform the debate between free traders and protectionists, who can both take ammunition from his wide-ranging research. As Kenneth Rogoff, an economics professor at Harvard University, said in a collection 190 The Great Economists of essays celebrating Samuelson’s work:8 ‘If and when interplanetary trade ever commences (say, via radio beam exchanges of technological blueprints and music), economists of the day will quickly find themselves trotting out expositions of Samuelson’s 1948 paper.’

The Blockchain Alternative: Rethinking Macroeconomic Policy and Economic Theory by Kariappa Bheemaiah

"World Economic Forum" Davos, accounting loophole / creative accounting, Ada Lovelace, Adam Curtis, Airbnb, Alan Greenspan, algorithmic trading, asset allocation, autonomous vehicles, balance sheet recession, bank run, banks create money, Basel III, basic income, behavioural economics, Ben Bernanke: helicopter money, bitcoin, Bletchley Park, blockchain, Bretton Woods, Brexit referendum, business cycle, business process, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, cashless society, cellular automata, central bank independence, Charles Babbage, Claude Shannon: information theory, cloud computing, cognitive dissonance, collateralized debt obligation, commoditize, complexity theory, constrained optimization, corporate governance, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, cross-border payments, crowdsourcing, cryptocurrency, data science, David Graeber, deep learning, deskilling, Diane Coyle, discrete time, disruptive innovation, distributed ledger, diversification, double entry bookkeeping, Ethereum, ethereum blockchain, fiat currency, financial engineering, financial innovation, financial intermediation, Flash crash, floating exchange rates, Fractional reserve banking, full employment, George Akerlof, Glass-Steagall Act, Higgs boson, illegal immigration, income inequality, income per capita, inflation targeting, information asymmetry, interest rate derivative, inventory management, invisible hand, John Maynard Keynes: technological unemployment, John von Neumann, joint-stock company, Joseph Schumpeter, junk bonds, Kenneth Arrow, Kenneth Rogoff, Kevin Kelly, knowledge economy, large denomination, Large Hadron Collider, Lewis Mumford, liquidity trap, London Whale, low interest rates, low skilled workers, M-Pesa, machine readable, Marc Andreessen, market bubble, market fundamentalism, Mexican peso crisis / tequila crisis, Michael Milken, MITM: man-in-the-middle, Money creation, money market fund, money: store of value / unit of account / medium of exchange, mortgage debt, natural language processing, Network effects, new economy, Nikolai Kondratiev, offshore financial centre, packet switching, Pareto efficiency, pattern recognition, peer-to-peer lending, Ponzi scheme, power law, precariat, pre–internet, price mechanism, price stability, private sector deleveraging, profit maximization, QR code, quantitative easing, quantitative trading / quantitative finance, Ray Kurzweil, Real Time Gross Settlement, rent control, rent-seeking, robo advisor, Satoshi Nakamoto, Satyajit Das, Savings and loan crisis, savings glut, seigniorage, seminal paper, Silicon Valley, Skype, smart contracts, software as a service, software is eating the world, speech recognition, statistical model, Stephen Hawking, Stuart Kauffman, supply-chain management, technology bubble, The Chicago School, The Future of Employment, The Great Moderation, the market place, The Nature of the Firm, the payments system, the scientific method, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, too big to fail, trade liberalization, transaction costs, Turing machine, Turing test, universal basic income, Vitalik Buterin, Von Neumann architecture, Washington Consensus

Brain Arthur, Doyne Farmer, Andreas Antonopoulos, Satyajit Das, Joyce Appleby, Yanis Varoufakis, Patrick O’Sullivan, Nigel Allington, Mark Esposito, Sitabhra Sinha, Thomas Sowell, Niall Ferguson, Andy Stern, Alan Kirman, Neel Kashkari, Danny Dorling, David Graeber, Amir Sufi, Atif Mian, Vitalik Buterin, Andy Haldane, Gillian Tett, Martin Sandbu, Robert Reich, Kenneth Rogoff, Paul Beaudry, Michael Kumhof, Diane Coyle, Ben Dyson, Dirk Helbing, Guy Michaels, David Autor, Richard Gendal Brown, Tim Swanson, David Andolfatto, Paul Pfleiderer, Zoltan Pozsar, Frank Levy, Richard Murnane, César Hidalgo, and Robin Hanson, among others. An equal measure of thanks also needs to be given to all the academics and researchers whom I had the chance to meet via the Institute of New Economic Thinking.

…

But the physical printing of cold hard cash is still the right of the government, and the revenues from paper currency are considerable enough to offer the biggest counterargument to moving to a cashless system. But in light of the costs of the illegal activities that cash facilitates, the profits earned by Seigniorage are a pittance in comparison. As stated by Kenneth Rogoff in The Curse of Cash (2016), The “profits” governments reap by blindly accommodating demand for cash are dwarfed by the costs of the illegal activity that cash, especially big bills, facilitates. The effect of curtailing paper currency on tax evasion alone would likely cover the lost profits from printing paper currency, even if tax evasion fell by only 10–15%.

End This Depression Now! by Paul Krugman

airline deregulation, Alan Greenspan, Asian financial crisis, asset-backed security, bank run, banking crisis, bond market vigilante , Bretton Woods, business cycle, capital asset pricing model, Carmen Reinhart, centre right, correlation does not imply causation, credit crunch, Credit Default Swap, currency manipulation / currency intervention, debt deflation, Eugene Fama: efficient market hypothesis, financial deregulation, financial innovation, Financial Instability Hypothesis, full employment, German hyperinflation, Glass-Steagall Act, Gordon Gekko, high-speed rail, Hyman Minsky, income inequality, inflation targeting, invisible hand, it is difficult to get a man to understand something, when his salary depends on his not understanding it, It's morning again in America, James Carville said: "I would like to be reincarnated as the bond market. You can intimidate everybody.", Joseph Schumpeter, junk bonds, Kenneth Rogoff, liquidationism / Banker’s doctrine / the Treasury view, liquidity trap, Long Term Capital Management, low interest rates, low skilled workers, Mark Zuckerberg, Minsky moment, Money creation, money market fund, moral hazard, mortgage debt, negative equity, paradox of thrift, Paul Samuelson, price stability, quantitative easing, rent-seeking, Robert Gordon, Ronald Reagan, Savings and loan crisis, Upton Sinclair, We are all Keynesians now, We are the 99%, working poor, Works Progress Administration

The Road Not Taken Historically, financial crises have typically been followed by prolonged economic slumps, and U.S. experience since 2007 has been no different. Indeed, U.S. numbers on unemployment and growth have been remarkably close to the historical average for countries experiencing these kinds of problems. Just as the crisis was gathering momentum, Carmen Reinhart, of the Peterson Institute of International Economics, and Kenneth Rogoff, of Harvard, published a history of financial crises with the ironic title This Time Is Different (because in reality it never is). Their research led readers to expect a protracted period of high unemployment, and as the story unfolded, Rogoff would note that America was experiencing a “garden-variety severe financial crisis.”

Everydata: The Misinformation Hidden in the Little Data You Consume Every Day by John H. Johnson

Affordable Care Act / Obamacare, autism spectrum disorder, Black Swan, business intelligence, Carmen Reinhart, cognitive bias, correlation does not imply causation, Daniel Kahneman / Amos Tversky, data science, Donald Trump, en.wikipedia.org, Kenneth Rogoff, labor-force participation, lake wobegon effect, Long Term Capital Management, Mercator projection, Mercator projection distort size, especially Greenland and Africa, meta-analysis, Nate Silver, obamacare, p-value, PageRank, pattern recognition, publication bias, QR code, randomized controlled trial, risk-adjusted returns, Ronald Reagan, selection bias, statistical model, The Signal and the Noise by Nate Silver, Thomas Bayes, Tim Cook: Apple, wikimedia commons, Yogi Berra

Food and Drug Administration (FDA) allows foods with less than half a gram of fat per serving to still be called “fat-free.” So, if you eat more than one serving of a few “fat-free” foods per day, you could easily be consuming a few grams of fat.27 Tough cell—It was, as Bloomberg Business called it, “the Excel Error that Changed History.”28 Two Harvard University economists—Carmen Reinhart and Kenneth Rogoff—ended up in the headlines for all the wrong reasons when they made a spreadsheet mistake in a paper that examined the effects of government debt on economic growth. They forgot to include five rows in one of their calculations, which made a key result turn out to be -0.1 percent instead of +0.2 percent.

Cryptoassets: The Innovative Investor's Guide to Bitcoin and Beyond: The Innovative Investor's Guide to Bitcoin and Beyond by Chris Burniske, Jack Tatar

Airbnb, Alan Greenspan, altcoin, Alvin Toffler, asset allocation, asset-backed security, autonomous vehicles, Bear Stearns, bitcoin, Bitcoin Ponzi scheme, blockchain, Blythe Masters, book value, business cycle, business process, buy and hold, capital controls, carbon tax, Carmen Reinhart, Clayton Christensen, clean water, cloud computing, collateralized debt obligation, commoditize, correlation coefficient, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, cryptocurrency, disintermediation, distributed ledger, diversification, diversified portfolio, Dogecoin, Donald Trump, Elon Musk, en.wikipedia.org, Ethereum, ethereum blockchain, fiat currency, financial engineering, financial innovation, fixed income, Future Shock, general purpose technology, George Gilder, Google Hangouts, high net worth, hype cycle, information security, initial coin offering, it's over 9,000, Jeff Bezos, Kenneth Rogoff, Kickstarter, Leonard Kleinrock, litecoin, low interest rates, Marc Andreessen, Mark Zuckerberg, market bubble, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, Network effects, packet switching, passive investing, peer-to-peer, peer-to-peer lending, Peter Thiel, pets.com, Ponzi scheme, prediction markets, quantitative easing, quantum cryptography, RAND corporation, random walk, Renaissance Technologies, risk free rate, risk tolerance, risk-adjusted returns, Robert Shiller, Ross Ulbricht, Salesforce, Satoshi Nakamoto, seminal paper, Sharpe ratio, Silicon Valley, Simon Singh, Skype, smart contracts, social web, South Sea Bubble, Steve Jobs, transaction costs, tulip mania, Turing complete, two and twenty, Uber for X, Vanguard fund, Vitalik Buterin, WikiLeaks, Y2K

Typically, the logic goes that the markets have evolved from more primitive years, and financial engineering innovations have led to robust markets that can’t possibly crash. Time and again this thesis has been refuted by subsequent market crashes. In their well-regarded book This Time Is Different: Eight Centuries of Financial Folly, Carmen Reinhart and Kenneth Rogoff deliver a 300-page tour de force to prove that this time is never different. They describe how “this time is different” thinking was used to justify the sustainability of jubilant markets prior to the 1929 crash that led to the Great Depression. Proponents of “this time is different” thinking claimed that business cycles had been cured by the creation of the Federal Reserve in 1913.

…

Edward Chancellor, Devil Take the Hindmost: A History of Financial Speculation (Farrar, Straus and Giroux, 1999). 2. http://www.thebubblebubble.com/mississippi-bubble/. 3. http://www.thebubblebubble.com/south-sea-bubble/. 4. Edward Chancellor, Devil Take the Hindmost. 5. Ibid. 6. Ibid. 7. Ibid. 8. Ibid. 9. Carmen M. Rinehart and Kenneth S. Rogoff, This Time Is Different (Princeton University Press, 2011). 10. https://www.washingtonpost.com/news/wonk/wp/2015/06/08/bitcoin-isnt-the-future-of-money-its-either-a-ponzi-scheme-or-a-pyramid-scheme/?utm_term=.39f7a8895637. 11. http://documents.worldbank.org/curated/en/660611468148791146/pdf/WPS6967.pdf. 12. https://cointelegraph.com/news/one-coin-much-scam-swedish-bitcoin-foundation-issues-warning-against-onecoin. 13. https://news.bitcoin.com/beware-definitive-onecoin-ponzi/. 14. https://www.fca.org.uk/news/news-stories/beware-trading-virtual-currencies-onecoin. 15. https://www.sec.gov/investor/alerts/ia_virtualcurrencies.pdf. 16.

Investment: A History by Norton Reamer, Jesse Downing

activist fund / activist shareholder / activist investor, Alan Greenspan, Albert Einstein, algorithmic trading, asset allocation, backtesting, banking crisis, Bear Stearns, behavioural economics, Berlin Wall, Bernie Madoff, book value, break the buck, Brownian motion, business cycle, buttonwood tree, buy and hold, California gold rush, capital asset pricing model, Carmen Reinhart, carried interest, colonial rule, Cornelius Vanderbilt, credit crunch, Credit Default Swap, Daniel Kahneman / Amos Tversky, debt deflation, discounted cash flows, diversified portfolio, dogs of the Dow, equity premium, estate planning, Eugene Fama: efficient market hypothesis, Fall of the Berlin Wall, family office, Fellow of the Royal Society, financial innovation, fixed income, flying shuttle, Glass-Steagall Act, Gordon Gekko, Henri Poincaré, Henry Singleton, high net worth, impact investing, index fund, information asymmetry, interest rate swap, invention of the telegraph, James Hargreaves, James Watt: steam engine, John Bogle, joint-stock company, Kenneth Rogoff, labor-force participation, land tenure, London Interbank Offered Rate, Long Term Capital Management, loss aversion, Louis Bachelier, low interest rates, managed futures, margin call, means of production, Menlo Park, merger arbitrage, Michael Milken, money market fund, moral hazard, mortgage debt, Myron Scholes, negative equity, Network effects, new economy, Nick Leeson, Own Your Own Home, Paul Samuelson, pension reform, Performance of Mutual Funds in the Period, Ponzi scheme, Post-Keynesian economics, price mechanism, principal–agent problem, profit maximization, proprietary trading, quantitative easing, RAND corporation, random walk, Renaissance Technologies, Richard Thaler, risk free rate, risk tolerance, risk-adjusted returns, risk/return, Robert Shiller, Sand Hill Road, Savings and loan crisis, seminal paper, Sharpe ratio, short selling, Silicon Valley, South Sea Bubble, sovereign wealth fund, spinning jenny, statistical arbitrage, survivorship bias, tail risk, technology bubble, Teledyne, The Wealth of Nations by Adam Smith, time value of money, tontine, too big to fail, transaction costs, two and twenty, underbanked, Vanguard fund, working poor, yield curve