Nobel Prize laureate
As we were talking early in the afternoon Thursday, the U.S. stock market had tumbled by more than 300 points, websites carried alarming headlines about a possible financial meltdown of
Still, Stiglitz seemed upbeat about the economies of
Asked whether the U.S. debt agreement is more likely to lead to an economic slowdown or a full-blown recession, Stiglitz said that "there is a significant risk of another global recession." But he added, "I don't think it's going to be quite as bad as the 2008 recession," because this time it won't take the world by surprise as it did three years ago.
Stiglitz said that "the likelihood is that
When we talked about
"I see a lot of growth there, and in many of the countries, it's really based on solid foundations," he said.
But isn't that growth largely a bubble based on high world commodity prices? Aren't many countries in the region wasting their biggest opportunity ever to invest in education and infrastructure, and to diversify their economies?
"You are right. But at the same time, there have been big advances," he said, citing
"But it is very important for
My opinion: Stiglitz does not have many fans among mainstream economists, who see him as a far-left academic who is playing to his fans in the developing world. But then, it is only fair to say that most mainstream economists have been as adrift as anybody else when it came to foreseeing the recent economic crises.
I tend to side with those who, like Roubini, think that
I'm not basing my hunch on economic theories, but what I see on the ground -- affluent Brazilians, Venezuelans, Argentines and other Latin Americans flocking to
Like them, many wealthy Latin Americans are running to the high grounds, because they see a crisis at home around the corner. We have seen that movie before, and they are most often right.
Nevertheless, the world will be a better place if the current U.S. and European slowdown does not extend everywhere. In that sense, let's hope that Stiglitz is right, and the rest of us are wrong.
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