Prieur’s readings (December 30, 2009)
This post provides links to a number of interesting articles I have read over the past few days that you may also enjoy.
• Niall Ferguson (The Financial Times): The decade the world tilted east, December 27, 2009.
If we can come up with a good explanation for the west’s past ascendancy, can we then offer a prognosis for its future? Put differently, are we living through the end of the domination of the world by the civilisation that arose in western Europe in the wake of the Renaissance and Reformation – the civilisation that, propelled by the scientific revolution and the Enlightenment, spread across the Atlantic and as far as the Antipodes, finally reaching its apogee in the age of industry and empire?
• Joel Kotkin (New Geography): Don’t give up on the US, December 29, 2009.
If the US were a stock, it would be trading at historic lows. The budget deficit is out of control, the economy is anemic and the political system is controlled by academic ideologues and Chicago hacks. Opposing them is a force largely comprised of know-nothings – to call them Neanderthals would be too complimentary. Yet, in spite of everything, I would still place my long-term bets on the US.
• Martin Wolf (Financial Times): The challenges of managing our post-crisis world, December 29, 2009.
The underpinnings of our global economy and so of our globalised civilisation remain dangerously fragile. Somehow, we must manage to sustain a dynamic global economy, promote development, deliver environmental sustainability and ensure peaceful and co-operative international relations.
• John Tamny (Forbes): Stimulating by saving, December 28, 2009.
In his essential book The Wealth of Nations, Adam Smith observed that “Capitals are increased by parsimony, and diminished by prodigality and misconduct.” Or, put more simply, self-interested savers are an economy’s ultimate benefactor.
• Robert Reich (Los Angeles Times): Wall Street bailout – the great sideshow of 2009, December 27, 2009.
The problem is and was Main Street, in the real economy. Why? Because nearly all the gains of economic growth have for years been going to a relatively small number of people at the top. As long as income and wealth keep concentrating at the top, and the great divide between America’s have-mores and have-lesses continues to widen, the Great Recession won’t end — at least not in the real economy.
• Hugo Lindgren (New York Magazine): Let the good times roll, December 27, 2009.
Might the recovery be more robust than widely expected? Wall Street’s most respected pessimist, James Grant, thinks so.
• Brian Wesbury and Robert Stein (Forbes): Bulls on parade, December 29, 2009.
What a difference a year makes. At this time last year, when many thought the whole economic and financial world was falling apart, we forecast that the Dow Jones Industrial Average would rally and recover to 11,000 by the end of 2009. As it stands now, it looks like the market is going to fall a bit short of our expectations, but not by much.
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