Is the Global Economy Unstable?

The Washington Post ^ | Wednesday, March 16, 2005 | Robert J. Samuelson

[Thebaddog]

Would the term Global Speculation be more apt?

[blackeagle]

bump - waiting to see how this one plays out

[sevry]

We simply don't understand well how the global economy operates.

I think it's fair to say, Bob, that if take out the words, global, and, well, that you've pretty much described the 'science' of economics.

[Toddsterpatriot]

Globalization's winners vastly outnumber its losers.

Yeah, so do globalization's whiners. That reminds me, how are you doing Willie?

[carlr]

Economists tend to be worse than weathermen when it comes to predicting economic activity.Particularly boom or bust trends.
Case in point,High deficits are supposed to lead to high interest rates yet quite often the opposite is true.The Fed controls the rates to try to steer the economy yet we continue to hear the interest rate tied to deficit mantra over and over.The Fed lowered rates with the deficit growing to help stimulate the economy after 2001.Rates are now going up but they also did in the late 90s when we had a surplus.The reason is to slow down the economy to find a balance between growth and inflation.

[RightWhale]

How would anybody know if the global economy is stable? Even if it is, who would care? Most economy is local. That's what the word means--at home or in the house.

[LowCountryJoe]

I think it's fair to say, Bob, that if take out the words, global, and, well, that you've pretty much described the 'science' of economics.

let's try that then.

We simply don't understand well how the global economy operates.

I like that; it pretty much could be a quote that collectively could have rolled off of the keyboards of most (and nearly all) FreeRepublic protectionists.

[RightWhale]

It has been established that the state is not derived from nor created to manage the market.

[sevry]

I think it's fair to say, Bob, that if take out the words, global, and, well, that you've pretty much described the 'science' of economics.

In what context was that raised? I was referring to economists, in general. What is an 'FR protectionist'? And would they know any more than the average economist to which I referred. Frankly, I don't count Milton Friedman and a few others. THEY tend to make sense, when they do.

[edcoil]

Unstable? Corrupt yes. Run by corrupt governments yes.

[expatpat]

Don't tell the FairTaxers that -- they have it all figured out.

[The Great RJ]

The losers in the global economy are those countries who do not embrace free markets and entrepreneurs. This would include Islamic theocracies, third world dictatorships as well as the more socialist economies of the EU.

[Woodworker]

Global has collapsed before. During the Great War (1914-1918) the global trade built up in the 1800's collapsed. The bad times of the 1920's (not every economy roared, and not every part of the American economy boomed)and the 1930's gave way to World War II. After that war, the USA pumped money into the world to build up the current global market. See Thomas PM Barnett's book, "The Pentagon's New Map" for more details:

http://www.thomaspmbarnett.com/pnm/pnm_index.htm

[reformedliberal]

Can someone explain why the global economy or any economy should be stable? It seems to me that all economies are vital, dynamic, changing all the time.

Is the WaPo raising a straw man? "Oh! The global economy could become unstable! We're all doomed!"

My personal economy is booming right now. Should I be concerned? Does that mean it may become unstable? When my personal economy was languishing, the last thing I wanted was for that to be its stable state.

[A. Pole]

Even if it is, who would care? Most economy is local.

No anymore. You depend on thousand of little parts produced on other continents.

"For want of a nail the shoe was lost.
For want of a shoe the horse was lost.
For want of a horse the rider was lost.
For want of a rider the battle was lost.
For want of a battle the kingdom was lost.
And all for the want of a horseshoe nail."

How your "local economy" will look without the thousand of nails or microchips?

[ARCADIA]

Explicit Translation: WORLD GOVERNMENT

I think that you have hit the nail on the head. If we are to depend on world trade, then we will be dragged into setting up a world government (a real one - not a UN).

[ARCADIA]

Can someone explain why the global economy or any economy should be stable?

People tend to go through life with certain expectations. You grow up, go to school, start a career, get married, raise kids, grow old, retire, and die. Somewhere in there is the assumption that you will be able to consistently eat and keep a roof over your head; and, on those occasions when those expectation's are not met, these people tend to kill each other and could even litter the entire place with radioctive residue. So it is always better to lower the risk, reduce the opportunity cost, plan ahead, and avoid unnecessary bumps in the road.