In The News

The World Consequences of US Decline

Immanuel Wallerstein August 16, 2011
For the past decade, analysts around the globe have suggested that the United States – its economy, innovations, political will and global influence – are in decline, and many US citizens agree, especially since the nation’s AAA credit rating was reduced by Standard & Poor’s. US citizens aren’t handling the decline well, and lash out at their political system and government officials. Other...

Let Down by Politics

Nayan Chanda August 15, 2011
In reducing the AAA credit rating for the US, Standard & Poor’s offered a forward-looking opinion on the risk of the nation meeting its obligations in full and on time. Rather than shun US treasury notes, investors sold off equities, putting the US stock markets into a nosedive. The reaction reflects deep skepticism, not about the quality of the debt, explains YaleGlobal Editor Nayan Chanda,...

Rolling Shocks Explain Why the World Is So Depressed

David Ignatius August 12, 2011
It’s an expectation that free economies and political systems return to normal after periods of volatility. But that’s not always so, explains David Ignatius in his column for the Daily Star. “A disruption that initially seems manageable gets bigger and more dangerous as the system oscillates up and down,” he writes. “Indeed, the effort to understand market failure and social disorder helped...

Globalization Has Role in This Double Whammy

Simon Nixon August 12, 2011
Globalization of communication, trade and financial networks highlights the potential of both prosperity and imbalances. “The creation of a rules-based multi-lateral trading system has been one of the greatest triumphs of the past 65 years,” writes Sam Nixon for the Wall Street Journal. Yet he also credits globalization with speculative bubbles, unrealistic expectations and uneven distribution of...

Global Economy: Is Anybody in Control?

David Dapice August 9, 2011
Around the globe, national leaders show no clue, no confidence, about how to re-engineer job creation or global economic security, contends economist David Dapice. The US has many resources for resolving its large debt, but bickering and stubborn quests for power prevent speedy resolution. Europe’s resistance to enact long-term policies on unequal accrual of debt among its member states and...

A Global Laughingstock, US Politicking Threatens Economy

Philip Bowring August 2, 2011
US Congress went to the wire, lifting a debt ceiling to allow payment of its bills, salaries and benefits. The world wasn’t impressed by a last-minute show of unity, after weeks of unseemly squabbling that put the global economy at risk. Financial journalist Philip Bowring contends the spectacle that raised the long-term costs of government borrowing also exposed an undercurrent of troubles: US...

Read China’s Lips

Stephen S. Roach July 28, 2011
China funded US government spending in recent decades with low-interest loans. But the threat of default may end that free ride. China is the largest foreign holder of US Treasuries and other agency notes, with about $2 trillion invested. US financial woes have prompted China to adjust its growth strategy, explains economist Stephen Roach in an essay for Project Syndicate. Beijing worries about...