Details

The Road to Recovery

How and Why Economic Policy Must Change
1. Aufl.

von: Andrew Smithers
16,99 €
Verlag:	Wiley
Format:	PDF
Veröffentl.:	15.08.2013
ISBN/EAN:	9781118515679
Sprache:	englisch
Anzahl Seiten:	360

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Beschreibungen

Titelbeschreibung

Renowned economist Andrew Smithers offers prescriptive advice and economic theory on avoiding the next financial crisis In The Road to Recovery, Andrew Smithers—one of a handful of respected economists to have accurately predicted the most recent global financial crisis—argues that the neoclassical consensus governing global economic decision-making must be revised in order to avoid the next financial collapse. He argues that the current low interest rates and budget deficits have prevented the recession becoming a depression but that those policies cannot be continuously repeated and a new consensus for action must be found. He offers practical guidance on reducing government, household, and business debt; changing the economic incentives for the management class that currently inhibit long-term growth; and rebalancing national economies both internally and externally. Further, he explains how central bankers must broaden the economic theories that guide their decisions to include the major factors of debt and asset prices. <ul> <li>Offers practical, real-world economic policies for restructuring and rebalancing the global economic system</li> <li>Presents a modern economic theory for preventing the next collapse</li> <li>Ideal for economists, investors, fund managers, and central bankers</li> <li>Written by an economist described by the legendary Barton Biggs as "one of the five best, most dispassionate, erudite analysts in the world"</li> </ul> As the global economy continues the long climb out of recession, it's imperative that central bankers and other economic decision-makers not repeat the mistakes of the past. The Road to Recovery offers prescriptive guidance on redesigning an economic system that is healthy, stable, and beneficial to all.

Inhaltsverzeichnis

Foreword ix Chapter 1 Introduction 1 Chapter 2 Why the Recovery Has Been So Weak 3 Chapter 3 Alternative Explanations for Today’s Low Business Investment and High Profit Margins 47 Chapter 4 Forecasting Errors in the UK and the US 61 Chapter 5 Cyclical or Structural: The Key Issue for Policy 69 Chapter 6 The Particular Problem of Finance and Banking 81 Chapter 7 Japan Has a Similar Problem with a Different Cause 107 Chapter 8 The End of the Post-War Era 125 Chapter 9 Misinformation as a Barrier to Sound Policy Decisions 149 Chapter 10 Avoiding Future Financial Crises 169 Chapter 11 The Current High Level of Risk 179 Chapter 12 Inflation 195 Chapter 13 Prospects Not Forecasts 219 Chapter 14 Tackling the Bonus Culture 229 Chapter 15 The Need for Change in Economic Theory and the Resistance to It 237 Chapter 16 Summary and Conclusions 255 Appendix 1 Mean Reversion of US Profit Margins 259 Appendix 2 Goods’ Output Requires Much More Capital Than Service Output 261 Bibliography 263 Acknowledgements 269 Index 271

Rezension

"A highly recommended and insightful read." (Mortgage Strategy, October 2014) "... anyone who wants to know how we got to a point where companies are making record profits but real wages are falling every year and growth is flat lining must read Andrew Smithers' new book The Road to Recovery: How and why economic policy must change." (Financial Times, 11 October 2013) "Mr Smithers is something of a maverick in financial and economic circles but he makes a powerful case—just as he did in 2000, when his book, Valuing Wall Street, pointed to the excesses of the dotcom bubble. Few listened to him then. More should do so now." (The Economist, 5 October 2013) "... a view that Mr Smithers sets out with great clarity in his brilliant new book, The Road to Recovery: How and Why Economic Policy Must Change, which should be read by every City fund manager, politician and policymaker before even more damage is done." (The Independent, 5 October 2013) "Smithers' argument is too important and too well-grounded to be ignored. The implications for economic policy are fundamental because unless we recognise how business behaviour has been fundamentally changed by bonuses and do something about it, we will be waiting round for years for a sustainable recovery which is just never going to happen. Instead, stagnation will become the norm." (London Evening Standard, 3 October 2013) "To the benefit of readers, Smithers does not explain his points via esoteric econometrics. He uses 127 clear charts throughout the book to illustrate the points being made. As well as a significant bibliography...." (Investment Europe, 1 October 2013) "... any senior executives benefiting from an incentive plan, who pride themselves on being open to evidence and new ideas, or on being an independent spirit rather than one of the herd, should not dismiss The Road to Recovery, but rather take up the gauntlet flung down by Smithers and read what he has to say." (World Economic Forum, October 2013)

Autorenportrait

Andrew Smithers is Chairman of Smithers & Co. Ltd. and is a leading expert on financial economics and global asset allocation. His forty-five years' experience in international investment includes twenty-five years at SG Warburg & Co where, amongst other roles, he ran the investment management division, and over twenty years as head of his own investment consultancy firm, Smithers & Co, based in London. He is the co-author of three books on international finance: Valuing Wall Street, co-written with Stephen Wright, published in 2000; and Japan's Key Challenges for the 21st Century, co-written with David Asher, published in 1999. His book Wall Street Revalued - Imperfect Markets and Inept Central Bankers was published by John Wiley & Sons, Ltd. in July, 2009. He is also the author of Chapter 6, "Can We Identify Bubbles and Stabilize the System?" in The Future of Finance: The LSE Report, published by The London School of Economics and Political Science in September, 2010. Andrew is a Trustee of the Daiwa Anglo-Japanese Foundation, a Fellow of CFA (UK) and member of the Advisory Board for the Centre for International Macroeconomics and Finance (CIMF) at Cambridge University. As head of Smithers & Co., Andrew has helped pioneer the application of academic analysis of financial economics to investment management. He is well known for his work on valuing markets, including application of "q", for his pioneering studies on the distorting impact of employee stock options on US profits, and for work on showing the understatement of Japanese published profits compared with US ones. www.smithers.co.uk

Back cover copy

The financial crisis caused widespread misery and the greatest loss of output and employment of the post-war era. The subsequent weak and faltering recovery has prolonged the pain. In The Road to Recovery: How and why economic policy must change, Andrew Smithers shows that both the crisis and the weakness of the recovery are the result of poor policies based on faulty economics. It is vital that governments and central banks can be persuaded to abandon the misconceptions on which their current policies are based. The Road to Recovery explains, in non-technical language, the major change in our thinking that will allow the world economy to recover and to prevent another financial crisis. There has been a dramatic change in the way managements are paid in the UK and the US. Incentives have changed and this has naturally led to a change in behaviour. This key problem is being ignored. The current management incentives are not only the reason for the massive gap between high and average pay but also for our economic stagnation. Attempts to generate growth, while ignoring the cause of this inaction, threaten to create another financial crisis. In his foreword Martin Wolf states that Andrew ‘has an apparently uncanny – indeed downright infuriating - tendency to be right’. Readers need to understand the errors that are currently being made in order to persuade policy makers to change tack and, in case that fails, to be warned and take action to reduce the costs of the financial and economic troubles that otherwise loom ahead.