In The News

Paulson’s Plan Was Not a True Solution to the Crisis

Martin Wolf September 24, 2008
World creditors came to a sudden conclusion – that US deficit spending at the household and government levels is highly dangerous and unsustainable – and as a result hang on tight to any money they hold. Spending and lending has slowed drastically. Major institutions – lending agencies, investment banks, insurance firms – have come close to folding, and the Bush administration has reversed all...

Scrambling to Clean Up After a Category 4 Financial Storm

Steven Pearlstein September 24, 2008
The global economy is in crisis, with giant financial institutions folding, banks refusing to lend to other banks and some countries closing, changing stock-market rules and currencies dropping in value. “What we are witnessing may be the greatest destruction of financial wealth that the world has ever seen – paper losses measured in the trillions of dollars,” writes Steven Pearlstein for the...

Paulson’s Moment of Truth

September 18, 2008
With major firms imperiled, the US government has had to up-end its economic policies by intervening and extending rescues to private investment banks, government-sponsored lenders and a major insurance firm. The bail-outs have added to US debt while deflating value of the US dollar. By refusing to bail out investment bank Lehman Brothers, US Treasury Secretary Henry Paulson signaled that...

Wall Street Dodges a Bullet, How About Next One?

David Dapice September 17, 2008
Low interest rates prompted many investors and homeowners to pour savings into real estate and homes. Investors, convinced that prices could not fall, purchased debt packages including mortgages based on ample credit with little down payments. Prices for homes and investments soared, with the total value of US housing going from about $12 trillion in 2000 to more than $20 trillion in 2006. Now,...

Islamic Bond Decree Cripples Sukuk, Imperils Projects

Haris Anwar September 5, 2008
Strict interpretation of Islamic law discourages interest payments associated with debt. Banks in fast-growing areas of the Middle East, like Dubai, created a special group of bonds – or sukuk market – described as Shariah-compliant, which allow payment through the exchange of assets rather than money. Bonds, as instruments of debt, raise capital and spur development of property, and unlike...

Is America Losing At Globalization?

Daniel Gross September 4, 2008
Countries compete, and in the modern era, economics, education and innovation matter no less than military might. With a strong education program and many life-changing inventions, the US mastered globalization throughout the 20th century. But complacency set in, respect for science and education fell, and the growth that comes from innovation has waned. Other countries have caught up and even...

US and Global Economies Slipping in Unison

Peter S. Goodman August 28, 2008
Reckless real-estate lending and a credit crisis in the US have led its consumers to purchase fewer foods in the global marketplace, which in turn slows foreign investment within US borders, reports Peter Goodman for the New York Times. “Overseas demand for American goods and services was supposed to continue compensating for waning demand in the States,” Goodman writes, reporting on the...