Weekly Selection 1 November 2019

Nouriel Roubini, The Allure and Limits of Monetized Fiscal Deficits

(Project Syndicate, October 28, 2019)

This is a topic that was widely discussed at the recent IMF Annual Meeting. Roubini argues the following: with the global economy experiencing a synchronized slowdown, any number of tail risks could bring on an outright recession. When that happens, he says, policymakers will almost certainly - regardless of whether the situation calls for it - pursue some form of central-bank-financed stimulus (‘crazy’ and unconventional policies he says). (reads in 6-7 min).

Mathew Burrows, Global risks 2035 update: Decline or new renaissance?

(The Atlantic Council, October 30, 2019)

This is an update of the Global Risk 2035 report. If anything, with de-globalization underway, conflict among the great powers looms even larger than when the initial report was written in mid-2016. Its conclusion: “The world now faces momentous challenges with climate change, the return of state-on-state conflict and an end to social cohesion with increasing levels of inequality. Without a political, intellectual and, some say, spiritual renaissance that addresses and deals with the big existential tests facing humanity we will not be able to move together into the future” (the summary reads in 4 min, the report itself in 1h+).

Jonathan Franklin, Chile protesters: 'We are subjugated by the rich. It's time for that to end'

(The Guardian, October 30, 2019)

Chile is one of the wealthiest and most politically stable countries of Latin America. Yet, protests have evolved in such a dramatic manner that President Pinera just had to cancel two important international summits. This article, based on interviews, helps make sense of what is driving the protests. The bottom-line: deep-rooted disillusionment over inequality that has left millions of citizens frozen out of Chile’s economic rise. The take-away: what’s happening in Chile could happen elsewhere (reads in 6-7 min).

Denise Lu and Christopher Flavelle, Rising Seas Will Erase More Cities by 2050, New Research Shows

(The New York Times, October 29, 2019)

The reason for posting this is not to have yet another piece on the catastrophic effects of climate change, but to corroborate the point that it is accelerating – a fact that every business / investment decision must factor in. The article refers to new research showing that rising seas could affect three times more people by 2050 than previously thought: 150 million people are now living on land that will be below the high-tide line by midcentury (reads in 7-8 min).

Arthur Krystal, Why We Can’t Tell the Truth About Aging

(The New Yorker, October 28, 2019)

This is an exceptionally rich review (for a 15 min+ read) of what the voluminous recent (and not so recent) literature tells us about ageing - physically, mentally, psychologically, cognitively... A spate of new books is meant to reassure us that getting old just means that we have to work harder at staying young. Most authors aren’t blind to the perils of aging - they just prefer to see the upside; but often the optimistic narrative of pro-aging writers doesn’t line up with the dark story told by the human body.