MILAN: I have been surprised by the recent coverage in the American press of gasoline prices and politics. Political pundits agree that presidential approval ratings are highly correlated with gas prices: when prices go up, a president's poll (...)
MILAN: Markets and capitalist incentives have great strengths in promoting economic efficiency, growth, and innovation. And, as Ben Friedman of Harvard University argued persuasively in his 2006 book “The Moral Consequences of Growth”, economic (...)
MILAN: In the 66 years since World War II ended, virtually all centrally planned economies have disappeared, largely as a result of inefficiency and low growth. Nowadays, markets, price signals, decentralization, incentives, and return-driven (...)
MILAN: If one looks at the trade patterns of the global economy's two biggest players, two facts leap out. One is that, while the United States runs a trade deficit with almost everyone, including Canada, Mexico, China, Germany, France, Japan, South (...)
MILAN: As the economist Mario Monti's new government takes office in Italy, much is at stake — for the country, for Europe, and for the global economy. If reforms falter, public finances collapse, and anemic growth persists, Italy's commitment to (...)
NEW YORK: Over the past three decades, hundreds of millions of new workers have entered the global economy. They arrived with various levels of education and skill, and over time have generally gained in terms of “human capital” — and in terms of (...)
MILAN: As the American economy continues to sputter three years after the global financial crisis erupted, one thing has become clear: the United States cannot generate higher rates of growth in GDP and employment without a change in the mix of the (...)
MILAN: The recent dramatic declines in equity markets worldwide are a response to the interaction of two factors: economic fundamentals and policy responses — or, rather, the lack of policy responses.
First, the fundamentals. Economic growth (...)
MILAN: In rapidly growing emerging markets, a combination of internal economic forces, supportive policies, and the shifting nature of the global economy drive high-speed and far-reaching change. The transformation of economic structures occurs so (...)
MILAN: The global economy's most striking feature nowadays is the magnitude and interconnectedness of the macro risks that it faces. The post-crisis period has produced a multi-speed world, as the major advanced economies — with the notable (...)
MILAN: Led by Asia, the share of the global economy held by emerging markets has risen steadily over recent decades. For the countries of Asia – especially its rising giants, China and India – sustainable growth is no longer part of a global (...)
NEW YORK: The global economy is at a crossroads as the major emerging markets (and developing countries more broadly) become systemically important, both for macroeconomic and financial stability and in their impact on other economies, including the (...)
MILAN: The worst of the financial/economic crisis seems to be over. Asset markets performed reasonably well in 2010. Growth in the United States and parts of Europe returned. Private-sector deleveraging continued, but was counter-balanced by rising (...)
NEW YORK: It is time for the G-20 to take seriously its mandate to agree on steps to stabilize the global economy and launch it on a more sustainable pattern of growth. Instead, the G-20 is behaving like a debating society, with the cooperative (...)
NEW YORK: For many, if not most, Americans, the crisis that befell them in 2008 — leading to slow growth, rising unemployment, and high anxiety among voters — appeared to spring from nowhere. Certainly, the vast majority of economists, investment (...)
NEW YORK: In September 2008, the global economy and financial system was hit by an earthquake, whose epicenter was in the United States. It was the end of the Bush administration. The presidential election was two months away. The timing, from the (...)
NEW YORK: Before the crisis of 2008, the International Monetary Fund was in decline. Demand for loans was low, leaving it short of revenue. Asia remained leery of the Fund a full ten years after the currency crises of the late 1990's. Its analytical (...)
MILAN: In the past two years, two dangerous episodes of financial instability and sudden changes in market dynamics have hit the world economy. More are likely, because the global economy is out of balance in several respects as it emerges from the (...)
MILAN: Around the world, the debate about financial regulation is coming to a head. A host of arguments and proposals is in play, often competing with one another — and thus inciting public and political confusion.
One approach to financial (...)
MILAN: Over the past two years, industrial countries have experienced bouts of severe financial instability. Currently, they are wrestling with widening sovereign-debt problems and high unemployment. Yet emerging economies, once considered much more (...)
MILAN: The late Milton Friedman said that a common currency — that is, a monetary union — cannot be sustained without a deep form of economic and political union. By this, he meant an open economy that ensures the free flow of goods, labor, and (...)
MILAN: It is about 18 months since the financial crisis hit, and 12 months since the panic started to recede, with asset prices stabilizing and beginning to turn up. Although recovery in advanced countries remains fragile, developing countries (...)
MILAN: It is hard to be optimistic about America at present. With the help of crucial government support in the crisis, the US financial sector (or at least parts of it) has bounced back, while America's real economy struggles with high (...)
MILAN: China is entering a complex set of transitions that will lay the foundations for the advanced-country status that it hopes to reach in the next 25 years. After three decades of sustained growth and a remarkably successful policy response to (...)
MILAN: Investors have been hit hard by the current crisis. Lessons are being learned and investment strategies revised.
The central lesson for investors seems to me to be that not all components of risk are static, but rather evolve in ways that (...)