Overall, the international financial authorities have handled this crisis the same way as previous ones: They bailed out the failing institutions and applied monetary and fiscal stimulus. But this crisis was much bigger and, at first, the same techniques did not work. The rescue of Lehman Brothers f

We are at the end of an era, but we are not fully aware of it. The two forms of economic organization — State Capitalism and International Capitalism are in competition with each other. Neither of them is attractive. The Washington Consensus has failed. International Capitalism in its present form h

The range of currencies included in the SDRs would have to be widened and some of the newly added currencies, which would include the renminbi, may not be fully convertible. Therefore the dollar could still reestablish itself as the preferred reserve currency, provided it is prudently managed.“特别提款权

This can be seen in Europe. And if European countries cannot agree among themselves, how can the rest of the world? During the crisis, Europe could not reach a Europe-wide agreement on guaranteeing the financial system each country had to guarantee its own. As things stand now, the Euro is an incomp

The Chinese leadership would need to be even more far-sighted than President Obama. They are in the driver&#39s seat and if they moved towards a more open society they would have to give up some of their privileges. Right now, the Chinese public is willing to subordinate individual freedom to politi

The Chinese economy is of course much smaller than the United States with a smaller motor, the world economy is likely to move forward at a slower pace. But within these limits a tectonic shift is taking place between the United States and China with third parties reorienting themselves to the sourc

Thank you. In these lectures, I have offered a conceptual framework for a better understanding of human events. These events are not determined by timelessly valid scientific laws. Such laws exist, of course, but they are not sufficient to determine the course of events. The complexity of the situat

This time it may be different, because there has been a shift in power from the regional to the central authorities, and the local officials of the banks are no longer under the control of the local provincial authorities — but success cannot be taken for granted. Moreover, China may be dragged by a

And, as I have tried to show, democracy is in deep trouble in America. The financial crisis has inflicted hardship on a population that does not like to face harsh reality. President Obama has deployed the &quotconfidence multiplier&quot and claims to have contained the recession. If there is a doub

The international financial system, as it was reconstructed after the Second World War, did not create a level playing field it was lopsided by design. The international financial institutions — the International Monetary Fund and the World Bank — were organized as shareholding companies in which th

The globalization of financial markets that took place since the 1980s was a market fundamentalist project spearheaded by the United States and the United Kingdom. Allowing financial capital to move around freely in the world made it difficult to tax it or to regulate it. This put financial capital

As things stand now, the financial system of each country is being sustained and supported by its own government. The governments are primarily with their own economies. This tends to give rise to financial protectionism, which threatens to disrupt and perhaps destroy global financial markets. Briti

Fortunately, Europe had the benefit of the social safety net. It held down European growth rates in good times, but it served its purpose in the downturn and the recession in Euroland turned out to be less severe than expected. Now that the fears of an economic collapse have subsided, the European U

The United States has been at the center of the international financial system ever since the Second World War. The dollar has served as the main international currency and the United States has derived immense benefits from that position but lately it has abused its privilege. Starting in the 1980s

Why should the United States initiate changes in a system of which it had been the main beneficiary? Because the system cannot survive in its present form and the United States has more to lose if it is not in the forefront of reforming it. America lost a lot of power and influence during the Bush p

After the collapse of the Soviet entire the United States emerged as the sole superpower. No other power, or the combination of powers, could challenge it&#39s supremacy. But the unipolar world did not take root. When President Bush sought to assert America&#39s supremacy by invading Iraq on false p

To sum up, the world is facing a choice between two fundamentally different forms of organization. We may label them international capitalism and state capitalism. The former, represented by the United States, has broken down and the latter, represented by China, is in the ascendant. The path of lea

We are at a moment in which the rage of uncertainties is unusually wide. We have just passed through the worst financial crisis since World War Two. It is quantitatively much larger and qualitatively different from other financial crisis. The only relevant comparisons are with the Japanese real esta

Effectively the international (financial) system has a tow-tier structure：Countries that can borrow in their own currency constitute the center, and those, whose borrowings are denominated in one of the hard currencies, constitute the periphery. If individual countries get into difficulties they rec

This is what a new Bretton woods conference could accomplish in one fell swoop. It would reconstitute the IMF to better reflect the prevailing pecking order among states and revise its methods of operation. It would decide how to treat financial institutions that are too big to fail and it would con

Something similar happened again in 1997 but by then the banks had learned to securitize their loans so they could not be forced into a collective system of lending and most of the losses had to be taken by the debtor countries. This set the pattern: the debtor countries were subjected to harsh mark

And yet, in spite of that, artificial life support has been successful. Barely a year after the bankruptcy of Lehman Brothers, financial markets have stabilized, stock markets have rebounded, and the economy is showing signs recovery. People want to return to business as usual and think of the Crash