The one nice feature about taking vacations away from reality is that I finally get some time to catch upon reading books that I have not had time for over the last year. With family commitments, a sickly older kitty, and work demands it has been one of those trying times where reading is a luxury but posting snarky comments for 30 seconds on Twitter is now a bloodsport. With that in mind, here are my three books from my recent trip to the Caribbean and an unabashed personal opinion on each.
Megathreats by Dr. Nouriel Roubini
I can summarize my review in one sentence:
A poor attempt at a listicle which reads like a printed, doomcentric, long Zero Hedge collection of end of the world articles highlighted by a final which makes one wish they had just chewed on broken glass instead of reading this book.
Before ripping this book to shreds, I would like to start by declaring I used to respect Dr. Roubini. His moniker of “Dr. Doom” was unwarranted during the 2007-2009 GFC, because he warned before it started that unchecked, it truly would create a financial crisis unseen in this nation since the 1930’s.
Something however has changed. This excerpt from page 85 speaks volumes:
Look at the new crop of central bankers. A few years ago we had outstanding economists like Ben Bernanke and Janet Yellen heading the Federal Reserve,….
I know that he worked for Yellen but for him to make this statement with a straight face, much less in print is laughable. Ben Bernanke as the head of the Federal Reserve in 2006 through 2014 has an opportunity to enforce the existing regulatory oversight built into the Fed’s legal structure to prevent much of this crisis by blocking the wanton creation of radical derivative instruments. But he did nothing and the crisis worsened to the point that in the end, he had to enact every power the Fed had under Section 13 of the Federal Reserve Act and introduce the beginning of what has become persistent inflation in this era, while monetizing risk at the expense of the taxpayer.
Then there is Janet Yellen. While she was President of the Federal Reserve Bank of San Francisco she actually brushed off the failure of Indymac in her district and said the following on January 22, 2007:
While the decline in housing activity has been significant and will probably continue for a while longer, I think the concerns we use to hear about the possibility of a devastating collapse-one that might be big enough to cause a recession in the US economy-have largely been allayed.–Fed Up, p. 76, by Daniellee DiMartino Booth
Yeah, that Janet Yellen, aka, Ms. Clueless.
By basically using his support for those economists he fails to see to even acknowledge that neither of them had any private sector experience nor ability to engage in regulatory oversight, a mistake which almost destroyed the entire US financial system.
In the chapters where he is pining for the re-engagement of globalization, he criticizes those that wish to de-globalize in the name of “populist movements” and nationalism. This is the problem with ivory tower analysis. If one actually talks to people on the ground overseas, it’s not that they hate most Americans as the people that they are, but the exploitation by our financial system and government which is used as a weapon to cause pain domestically should their leadership step out of line.
What Dr. Roubini fails to postulate is that the natural antithesis of globalization is regionalization where economies are tied together for domestic needs versus those of London, Tokyo, or Wall Street banks. The true de-globalization movement is being led by the nations of the East; be it China, Saudi Arabia, or smaller countries in Africa, Latin America, etc. The fear of losing control of the domestic economies in those regions, including many commodities would cause an expensive lesson in financial pain to the West if this is not stopped, up to and including military solutions by the US and its allies, if necessary.
Nouriel loses all credibility in his chapter titled An Uninhabitable Planet. This unhinged rant on page 222 sums up my newfound disregard for his ability to rationally speak about economic matters:
Increasing scientific evidence links global climate change and more frequent and extreme weather events: droughts, fires, desertification, and more frequent and virulent floods, hurricanes, and typhoons. Thus the damage from global climate change is increasingly present today rather than in the distant future.
It’s bad enough that the quasi-Marxist left has used this as their new religion to reign in and seize control of the capitalist system, but to use that as a “Megathreat” illustrates that the fallacies presented throughout his book should dissuade serious people from regarding his economic proclamations as nothing more that of a man seeking to stay in the “club” of influencer elites who emanate from places like Davos, DC, or Brussels.
I could go on with other aspects from his book, but you get the idea. Apparently the entire concept of the American system without submission to the dated and now failing ideas of Keynesian economics, is beyond the comprehension of the current crop of economists and elites publishing tripe like this.
Save your money, buy a real book from Mises or Ayn Rand instead.