In The News

$12 Trillion Monster Threatens Globalization

William Pesek June 12, 2007
Some countries control great pools of wealth, building funds from oil or other natural-resource revenue, according to William Pesek, Bloomberg news columnist. But with funds growing by leaps and bounds, their owners look to make good use of these savings – and in the process could transform global financial markets. The funds together, many based in Asia, could outgrow the entire US economy by...

Globalization Has Left Central Banks Facing a World of Growing Economic Uncertainties

Stephen King March 7, 2007
The macroeconomic policies of the world’s central banks are crucial for economic growth. By changing interest rates or adjusting the money supply, these banks keep inflation at low levels, thereby ensuring stable prices. That stability rests in large part on the predictability of the central banks and these institutions reacting consistently to market information. Recently, however, the data that...

Watchdog Attacks US Swoop for Bank Secrets

Ian Traynor February 9, 2007
The transatlantic conflict over privacy rights and international security continues as the leading European authority on data protection announced that a US financial information-sharing program abuses privacy rights “on a massive scale,” reports “The Guardian.” For the past six years, the US has collected names, account numbers and sums from European banking transactions through the Belgian-...

Different Paths of Asian Giants

Ramkishen S. Rajan January 29, 2007
The rapid emergence of China and India dramatically transformed the global economy during the last decade. But the two countries have pursued contrasting strategies: China’s industrialization has been fueled by public-sector investments and large-scale foreign direct investment (FDI) in manufacturing; India’s has been driven largely by domestic companies and entrepreneurs. More recently, however...

The False Promise of Financial Liberalization

Dani Rodrik January 22, 2007
Free capital flow over the past 15 years was supposed to help developing nations, writes Dani Rodrik, political economy professor with Harvard University, with excess funds moving from wealthy nations to worthy projects around the world, smoothing out boom-and-bust cycles and decreasing corruption. However, Rodrik points out that the developing nations with the most successful economies – China,...

US and China Differ on Aim of Economic Talks

Steven R. Weisman December 18, 2006
After proposing dialogue on trade with China, the US treasury secretary did not expect Beijing to be so quick with its own sage advice for Washington. While the US expects China to adjust its currency, allowing it to float in relation to the dollar, China wants the US to stop borrowing so much money. Adjusting the Chinese currency would perhaps slow the Chinese export market, allowing China to...

Micro-credit Pioneer Gets Nobel for Peace

Amelia Gentleman October 13, 2006
The Grameen Bank of Bangladesh and Muhammad Yunus, its founder, have won the latest Nobel Peace Prize in recognition for their work using microcredit loans to lift millions of women out of poverty. In the past, banks in the developing world rarely lent to the poor, trapping farmers in a cycle of poverty and depriving economies of small businesses. Yunus realized that even poor borrowers could...