The World Is Curved: Hidden Dangers to the Global Economy

The World Is Curved: Hidden Dangers to the Global Economy

by David M. Smick
     
 

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For more than two decades, David M. Smick has advised the world's top investors, central bankers, and political leaders. His book predicted the financial crisis and the devastating trouble as the crisis spread globally, and suggested what needs to be done to return our economy to prosperity.

In this revised and expanded edition, Smick explains why China remains a

Overview

For more than two decades, David M. Smick has advised the world's top investors, central bankers, and political leaders. His book predicted the financial crisis and the devastating trouble as the crisis spread globally, and suggested what needs to be done to return our economy to prosperity.

In this revised and expanded edition, Smick explains why China remains a major threat to the world economy; why European bank failures could destroy our financial system; how the United States is moving from reckless financial risk-taking to a situation even more perilous; and why the world's fundamental model for economic growth needs to be rethought.

Editorial Reviews

Publishers Weekly

Confronting the ever-increasing challenges of globalism and the economic problems plaguing the U.S. from a downward spiraling value of the dollar to the subprime mortgage crisis, Smick argues again and again that the solution to the problem is deregulation and encouraging entrepreneurship. While he examines the U.S. in relation to other emerging and potentially powerful markets (China and India, in particular), Smick argues weakly against Thomas Friedman's more utopian or opportunistic points of view. Jim Bond delivers the book in an accessible and gentle tone. Smick's prose can be a bit inundating, but Bond balances speed with emphasis to keep listeners' attention. A Portfolio hardcover (reviewed online). (Sept.)

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Library Journal

The 2007-08 subprime financial crisis is the jumping-off point for Smick's (Johnson Smick International) examination of current threats to global prosperity. He explains that although the subprime losses are small in the context of world financial markets, a lack of transparency has diminished investor confidence, dried up financial liquidity, and threatened the very foundations of our world financial system. He says that the growth of global financial markets has made it more difficult for central banks like the U.S. Federal Reserve to intercede effectively in times of crisis. Smick compares the subprime crisis to past events like the UK's forced devaluation of the pound in 1992 and Japan's economic stagnation in the 1990s. He warns of pending dangers like an overheating of the Chinese development juggernaut and the present calls for protectionism by U.S. politicians. He favors a global financial system built on transparency and trust. Smick's role for some 30 years as an economic adviser to central bankers and legislators of all stripes gives him a solid perspective on the global financial system. This summing-up of the subprime debacle and other global financial threats, aimed at general readers, is first rate; highly recommended for all public and academic libraries.-Lawrence Maxted, Gannon Univ. Lib., Erie, PA

Kirkus Reviews
It's a fraught time, writes hedge-fund guru Smick in this timely book. If the "Chinese juggernaut" doesn't sink us, then class warfare and our spendthrift ways will. Borrowing his title, obviously, from Thomas Friedman's optimistic The World Is Flat (2005), Smick dourly notes that in finance, the horizon is near while the dangers lurk out of sight-"nothing happens in a straight line. Instead, there is a continual series of unforeseen discontinuities-twists and turns of uncertainty that often require millions of market participants to stand conventional wisdom on its head." Seeing over the horizon is the job of sound analysts and good political leaders, who seem to be in short supply. Weathering the fiscal storms is ever harder for numerous reasons, one of them the declining vigor of central banks, another, in the United States, an accumulation of personal debt that threatens to put the economy into a Japan-like state of decades-long stagnation. Globalism, some would object, is a vehicle for weakening national economies, but Smick counters that "liberated global financial markets and free trade" are largely responsible for the creation of vast wealth in the last quarter-century (during which the Dow Jones Industrial Average rose from 800 to more than 12,000) and should not be unduly regulated, since economies seem to be slipping beyond the control of national governments. Instability will thus be the norm in the future, especially inasmuch as private concerns dwarf whole economies: The exposure of the Swiss bank UBS to the subprime mortgage meltdown was four times as large as the entire Swiss economy, Smick observes. Couple profligate habits with an ever-growing Chinese economybeholden to no one, and suddenly the future looks like a roller-coaster ride for even the most aggressive investor. A supremely useful book for portfolio planning, though not the thing to give someone who's inclined to worry about the state of the world. Agent: Fredrica Friedman/Fredrica S. Friedman and Company

Product Details

ISBN-13:
9781591842187
Publisher:
Penguin Publishing Group
Publication date:
09/04/2008
Pages:
320
Product dimensions:
6.30(w) x 9.10(h) x 1.10(d)
Age Range:
18 Years

What People are saying about this

Lawrence Eagleburger
"The World Is Curved is a brilliant, if disturbing, exposé of today's global financial minefields, and an equally compelling description of possible remedies. The next president would do well to read The World Is Curved before taking office next year."--(Lawrence Eagleburger, former U.S. Secretary of State)
Bill Bradley
"The World Is Curved makes transparent all the challenges facing today's new global economy. Read along while Smick exposes the hidden global economic dangers and what steps must be taken to correct an imperfect system."--(Bill Bradley, former U.S. Senator)
Lawrence H. Summers
"David Smick understands, as few do, that international finance depends on politics and passions as much as on policies. Agree or disagree, his sense of where we have been and where we are going deserves close attention. He writes in a way that makes giving close attention a pleasure."--(Lawrence H. Summers, former U.S. Secretary of the Treasury)
George P. Shultz
"The World Is Curved affords an engrossing look at the edifice upon which global finance has been built. It's a vision we ignore at our peril; for instance, we know from experience the dangers of protectionism. This is a vital primer about the zone where finance and statesmanship intersect."--(George P. Shultz, former U.S. Secretary of State)
Barton M. Biggs
"Smick is a world-class thinker. Any serious investor must read what he has to say."--(Barton M. Biggs, Traxis Partners and author of Hedgehogging)
Alan Greenspan
"The World Is Curved is an essential read for those who wish to understand the workings, politics and distresses of the global financial system. David Smick has done an outstanding job in drawing on his interactions with many of the key players in international finance, to produce an insightful and entertaining book."

Meet the Author

David Smick advises some of the world’s most successful money managers through his investment and strategic consulting firm Johnson Smick International, Inc. He is also the founder, editor, and publisher of The International Economy, an acclaimed quarterly. He has served as an adviser to both Republican and Democratic presidential candidates and has written for publications such as The Wall Street Journal and The New York Times. Mr. Smick and his family live in Washington, D.C.

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