Global Financial Crisis

It is appropriate for the society’s international members to visit Australia. Its position of economic strength owes a lot to Hayekian ideas of freedom, competition and discovery. Australia remains one of the best case studies on the power of market-based reforms.

Economists should take the time to ask themselves what they can learn from the events of the past three years. If they were honest with themselves, they would come to the conclusion that many of them had been too optimistic about their abilities to predict the future with certainty. They would have to confess that the world is too messy a place to be expressed in models of ‘general equilibrium’ or ‘perfect competition.’

When comparing Australia’s growth chances to the European predicament of shrinking and decline, it should not be hard to decide which path is more tempting. Growth is not everything, but without growth everything is more difficult.

THE global financial crisis has shaken the belief that economics can tell us anything worthwhile about human nature. Given this sad image of economics, it is refreshing to see that there are still economists out there who have something worthwhile to say. Even if it is only about soccer.

The stakes for Britain could hardly be higher. A return to the pre-crisis times of ‘Cool Britannia’, let alone Elgar’s Land of Hope and Glory is nowhere in sight. And instead of only printing Adam Smith’s portrait on their bank notes, British policy-makers should rather have read the great master.

If capitalists realise that there is more to doing business than just making money, if they learn the lessons of monkey capitalism, then the market economy, this fantastic engine of creating wealth and prosperity, will survive.

Auch wenn die Krise aus Helden oft ganz gewöhnliche Sterbliche gemacht hat, so hat sie doch gelegentlich auch genau umgekehrt gewirkt. Leute, die vormals als Spinner galten, werden plötzlich als Gurus gehandelt. Ein Paradebeispiel dafür ist Nouriel Roubini,Wirtschaftsprofessor an der Universität von New York. Roubini ist nicht nur zu einem der Gesichter der Krise geworden, sondern er gilt heute fast schon als ihr Prophet.

Where investment bankers were seen as the ”masters of the universe”, they are now almost as unpopular as bank robbers.
But if the crisis has made mortals out of former heroes, it has occasionally worked the other way as well. People who used to be regarded as cranks have been elevated to gurus. An example is New York University economics professor Nouriel Roubini, who has become the face of the crisis and its supposed prophet.