The International Economy

Daily provides news, commentary, and research on international economics. The source covers global financial policy, trends, and international law.

Articles from Vol. 17, No. 3, Summer

An Iraq Currency Game Plan: Either Adopt the Classic British Currency Board Model or Simply "Dollarize" Iraq. (the World)
In war or at peace, every successful action requires a game plan. The allied forces proved as much by executing their regime change objective in Iraq with precision. But even though the victors have grand ideas about remaking the Iraqi economy and...
Are Fannie and Freddie Safe and Sound? (Letter from Washington)
The recent management shakeup at Freddie Mac has significant implications for that company as well as its larger sibling, Fannie Mae. Until the company finally publishes its revised financial statements, we will not know for sure whether there is a...
Bankerspeak: Behind-the-Scenes Chatter at the Recent International Monetary Conference. (Letter from Berlin)
It is time we catch up with the International Monetary Conference (IMC). It brings together the chief executives of the largest financial institutions. Until two years ago, we used to listen in to the exclusive gathering of the world's top bankers...
Dealing with the Russians: Imagine You're Sitting in the Oval Office. What Advice Would You Offer George W. Bush? (A Symposium of Views)
Background: Earlier in his administration, President Bush pronounced that he had looked into the eyes of Russian President Vladimir Putin and taken a measure of his soul. Since then, the international community has assumed that this increasingly...
Do Budget Deficits Affect Long-Term Interest Rates? U.S. Federal Budget Deficits Are Back Big Time. What Will Be Their Long-Term Consequences? Seven Big Thinkers Enter the Ring, Gloves Up. (A Symposium of Views)
GLENN HUBBARD Former Chairman of the Council of Economic Advisers under President George W. Bush, Russell L. Carson Professor of Economics and Finance at Columbia University, and Research Associate of the National Bureau of Economic Research and...
Five Myths about the Oil Industry: Particularly since September 11, Global Chatter Keeps Offering Up Supposedly Accepted Notions about Oil. TIE Asked an Expert to Address Some of the Confusion. (Globalization)
Since the energy crisis of the 1970s, a number of myths about the oil industry have developed in political and media circles. In the post-September 11 environment these have been raised to near gospel. At times, ideological opponents who cannot agree...
Fixing Wall Street: A First Step toward Restoring Customer Trust in the System. (the United States)
More than half a century ago, Fred Schwed, Jr., who had survived the greatest of all financial market booms and busts, told the story of a tour bus of Nebraska farmers taken to downtown New York. The guide pointed out Trinity Church and the Morgan...
Fukui's Mission Impossible: Some Now Argue the Bank of Japan-With a Would-Be Reformer at the Helm-Is the Answer to Japan's Economic Malaise. Actually, the Central Bank Is Still Part of the Problem. (Japan)
The gist of my last article for The International Economy was as follows: The capital investment bubble of the late 1980s created a glut of supply capacity in the Japanese economy. Protected by ultra-low interest rates, this excess of supply capacity...
German vs. German: A Strange New Personal War Has Broken out between IMF Head Horst Kohler and German Finance Minister Hans Eichel. but beneath the Surface, Even Larger Issues-Including Perceived American Heavy-Handedness-Are at Stake. (Globalization)
Observing the start of Horst Kohler's tenure as new managing director of the International Monetary Fund (IMF) about three years ago (The International Economy, September/October 2000), we asked a pertinent question: Did the United States--by successfully...
How to Establish a Credible Iraqi Central Bank: The Argument for Inflation Targeting. (the World)
The vaults of the Central Bank of Iraq have played a role in some colorful news stories that have appeared in recent months. First, there is the claim that on the night of March 18, 2003, one of Saddam's sons made what has been euphemistically described...
In Defense of Globalization: Why Cultural Exchange Is Still an Overwhelming Force for Good. (Globalization)
Fears that globalization is imposing a deadening cultural uniformity are as ubiquitous as Coca-Cola, McDonald's, and Mickey Mouse. Many people dread that local cultures and national identifies are dissolving into a crass all-American consumerism. That...
In Memory of a Friend. (off the News)
DONALD T. REGAN was a brash, dashing, and thoroughly charming U.S. Treasury Secretary. He had style but style was not what he was all about. Regan wanted to make a difference and his accomplishments prove that he did. He was a major figure in the development...
Japan's Dying Market Economy: Why Tokyo Desperately Needs to Adopt the South Korean Model. (Japan)
With concerns about a retreat of economic globalization stemming from the Iraq war, the market economy in Japan increasingly appears to be suffering setbacks. One of the fears is that the growing economic role of the public sector, including the Bank...
Right Man at the Right Time. (off the News)
You don't have to be much of a Washington insider to recognize the extent to which the Bush high command is nervous about the U.S. economy. Their greatest concern: whether the long-awaited capital spending surge kicks in this summer, setting up the...
Rome on the Potomac: Like It or Not, America Today Finds Itself an Imperial Power Committed to Maintaining an Empire. the Only Question Is What Kind of Empire? (the United States)(Cover Story)
It was around 88 B.C. when the king of Pontus--Mithridates VI, sometimes called Mithridates the Great--decided he had had enough of Roman influence in his region, of Roman meddling in his affairs, of the whole gamut of Roman arrogance and imperial...
The Conscience of the Fed: First He Rose to Become the Federal Reserve's Top Staffer. Now He Helps Set the Pace as One of Washington's Newest Fed Governors. TIE's Exclusive Interview with Donald Kohn. (the United States)
TIE: How have you found being a Fed governor different than being a member of the senior staff?. KOHN: I've enjoyed the transition. I was ready for it; I had worked on monetary policy issues particularly during the last fifteen years, and I was...
The Emergence of an Important Fed Insider. (off the News)
WALK THROUGH the hallways of the Federal Reserve these days and it seems only one question is front and center: how to run if need be a "nontraditional" monetary policy. In other words, what if U.S. central bankers find, after lowering the Fed funds...
The Grand Playmaker: Every So Often TIE Sits Down with Its Old Friend, Former Secretary of State Lawrence Eagleburger, to Talk about the World. as Always, He Doesn't Disappoint. (the World)
What to Make of the French? I've always believed that fundamentally Charles de Gaulle was trying to restore French pride after World War II by attempting to build a French empire in opposition to the United States. The heart of his whole approach...
The Newfoundland Lesson: During the 1930s, Long before the IMF, the British Empire Coped with a Debt Crisis in a Small Country. This Is a Tale of the Choice between Debt and Democracy. It Shouldn't Be Forgotten. (Globalization)
As the frequency of developing country debt crises will testify, there is often a contradiction in the modern era between democracy and debt. Voters elect governments that pursue populist policies which lead to debt crises. The countries then turn...
Will the Fallen U.S. Dollar Set the Stage for a Global Economic Boom a Year or Two from Now? (A Symposium of Views)
Background: The conventional view is that the weakening of the U.S. dollar is the result in large part of global market concern with the negative effects from growing twin. U.S. deficits. Yet could the fallen dollar, particularly if it continues a...