Archive for January, 2009

Brainstorming Assignment

Friday, January 23rd, 2009

I think to start answering the research question we first have to know how the economic downturn began.  Even before that we need to understand the different players in the game, from countries to governments to individuals.  What choices did countries around the world make that left them more or less vulnerable to the current economic downturn?  A comparison of the relative openness and connectivity of different countries to international markets before and during the crisis would likely help us understand some of the global economic effects of the financial crisis.  How had the government regulated international finance in the past?  Was it becoming more or less open to it?  How much money did investors have in international markets – or how much confidence did investors have in international investments?

After the crisis we need to know what the macroeconomic shocks were in countries affected by the crisis.  Which countries had investment firms and banks that were significantly involved in and affected by the financial crisis?  How did the government respond to the economic shocks?  Did what the government’s action help – or not – and how much or how quickly?  More interesting perhaps is what citizens of different countries think of the financial crisis?  Did they blame another country? Big money? Investment firms? Their own government?  How this financial crisis will change the perceptions of people around the world, I think, should be an important part of our research (although it may be too soon to tell).  While the economy may get on its feet again people’s perceptions and confidence towards international finance may have changed in ways that will affect governments and investments for a while to come.

It is how this financial crisis has changed paradigms around the world that most interests me, and what choices might be associated with these new perspectives in the choices of future governments and investments.

“unedited” and “unfocused” Brainstorming

Friday, January 23rd, 2009

Well, first we must figure out exactly WHAT the current US Financial crisis is, before we can determine any global implications from it. Also, there may be several implications within different fields of study; so are we only sticking within the field of Finance? or Economics? But what exactly lies within the field of Finance? Lastly, are we only looking at the effects of what has already happened or will we also be looking at how new changes could curb or reverse the current recession/crisis?

Basically, I understand that we need to narrow down this broad question and that the way you want to do that is to let us choose. Honestly, I’d rather let you lead… but since thats not an option; personally, I’m interested in how other countries have adjusted or will adjust their lending and borrowing with good ‘ol Uncle Sam. Rather simple, I know, but to the point.

Brainstorm..

Friday, January 23rd, 2009

One of the main things I’m not entirely sure of is just how interconnected the global market system is. We all know that there’s such thing as an international market system where countries interact and utilize each others resources like labor and buy and sell to each other. But to what degree are the economies of the major international actors dependent or relying on imports and exports? Does that make sense? I think starting by trying to understand any sort of dependence that various countries have on a global economy is a good way to understand and measure just how much of an impact their market systems would have should something go awry in a country (such as the US) that they depend on. For example, I think Iceland’s economy sunk pretty far last fall as our crisis really picked up steam, whereas Korea is just now experiencing an economic slowdown. This is just one of the things I’m interested in.

Also, there was an interesting paper we read in Hansen’s Am. Econ History class last fall about the Great Depression. The author argues about how/why it began in the U.S. and whether or not the U.S. could be blamed for the Global Depression that began. http://www.jstor.org/stable/pdfplus/2138198.pdf

Another thing, I’m a person of lists and organization. So, what are our major industries that are over 50% dependent on foreign resources (ex: land, labor) and how do these industries contribute to our domestic economy? Also, visa versa, how much of an impact do our dependent industries have on the foreign economies they heavily interact with?

Brainstorming about the Research Question

Friday, January 16th, 2009

While I am gone next week, I’d like you to try to brainstorm about the research question which is the focus of this course: Namely, what are the global implications of the current US financial crisis/recession

· What are the things we need to figure out to answer this (broad) question?

· What questions do we need to explore?

· What parts of this broad question are you interested in?

When you are done brainstorming, post your thoughts on the course blog by Friday, January 23.  Don’t look at what anyone else writes until you’re done posting.

Remaining “Book Review” Books

Tuesday, January 13th, 2009

The following books have already been ‘claimed’ for the “Book Review”:

Kevin Philips, Bad Money, Reckless Finance, Failed Politics, and the Global Crisis of American Capitalism (Jackie Evans)

Charles Morris, The Trillion Dollar Meltdown: Easy Money, High Rollers, and the Great Credit Crash (Michael Warlick)

George Soros, The New Paradigm for Financial Markets: The Credit Crisis of 2008 and What It Means (Charles Murray)

George Cooper, The Origin of Financial Crises: Central Banks, Credit Bubbles and the Efficient Market Fallacy (Joe Mundy)

Martin Wolf, Fixing Global Finance (Margaret Graybeal)

Michael Lewis, Panic: The Story of Modern Financial Insanity (Sarah Restaino)

Barry Ritholz: Bailout Nation: How Easy Money Corrupted Wall Street and Shook the World (Erin Beddingfield)

Dean Baker, Plunder and Blunder: The Rise and Fall of the Bubble Economy (Sierra Stoney)

Niall Ferguson, The Ascent of Money (Ann Spillman)

John Bellamy Foster, The Great Financial Crisis: Causes and Consequences (Kendall Jones)

Robert Shiller, The Subprime Solution: How Today’s Global Crisis Happened (David Hydorn)

You could also choose some other book that I approve.

Welcome to ECON 482!

Friday, January 9th, 2009

The purpose of the seminar is to explore the global implications of the current US financial crisis.  More precisely, we plan to investigate how the financial crisis and subsequent recession are likely to affect economies, politics and other aspects of societies in the rest of the world, both near term and in the longer run.

We use the term ‘explore’ literally.  As the term begins, none of us has a good understanding of these global implications, though we hope to develop an understanding by the end.  You are welcome to follow along and contribute to the conversation.