Intersecting Minds: Education, Business and Technology at the North Carolina State Jenkins Graduate School of Management

More Signs of Global Cooperation | September 25, 2009

CNN reports today that the G-20 will supplant the G-8 as the primary decision-making body on major international financial and economic issues. In an earlier post I touched on the importance of cooperation to combat climate change. The same logic applies for managing the global economy. There are now so many connections that when catastrophe strikes one country it ends up striking many. Key passage:

One of the key goals is preventing such a crisis from occurring in the future, he said.

“In the run-up to this crisis, many of the world’s largest economies depended on the American consumer to buy their exports to drive growth, and we made it easy; for too long, Americans were buying too much and saving too little,” Geithner said. “And that’s no longer an option for us or for the rest of the world. And already in the United States you can see the first signs of an important transformation here as Americans save more and as we borrow substantially less from the rest of the world.”

In order to prevent another crisis, major imbalances must be prevented. The United States, or any other country for that matter, can not over-leverage itself to that extent. To keep that from happening, nations that have built up huge trade surpluses (i.e. China, Japan) need to encourage consumer spending to even out the balance.

One other interesting side note from the article. It doesn’t list the world’s 20 largest economies, and there’s actually a bit of disagreement there judging by the Wiki entry.

Here are the top 10:

1 United States 14,264,600
2 Japan 4,923,761
3 People’s Republic of China 4,401,614h
4 Germany 3,667,513
5 France 2,865,737
6 United Kingdom 2,674,085
7 Italy 2,313,893
8 Russia 1,676,586
9 Spain 1,611,767
10 Brazil 1,572,839
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2 Comments »

  1. Hey very nice blog!!….I’m an instant fan, I have bookmarked you and I’ll be checking back on a regular….See ya

    Comment by Tnelson — September 30, 2009 @ 10:33 pm

  2. Hey, I found your blog in a new directory of blogs. I dont know how your blog came up, must have been a typo, anyway cool blog, I bookmarked you. 🙂

    Comment by Bill Bartmann — October 9, 2009 @ 3:39 pm


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