Niall Ferguson spoke with CNBC this morning about the state of the global economy, the rise of China, and the chaos in the Middle East.
“At best case we’re going to re-run the 1970s, only with Barack Obama instead of Jimmy Carter in the White House,” he said.
More on his comments below:
- 0:25 If you look at the last 600 years, the big story was the rise of the west. But that’s ending, and has been from the 1970s. Now with industrialisation in Asia, it’s happening quickly. And change and collapse in the west could happen very quickly.
- 1:45 This isn’t a projection; China has become the biggest manufacturer in the world. This isn’t like Japan. China has a big economy, big country, has discovered Western tech.
- 2:35 Reserve currency status is a lagging indicator. Look at Britain in the 1940s. There is an explosion of public debt in the U.S. (threat number 1, according to Ferguson). But reserve currencies can’t switch overnight.
- 3:55 Very few of the ingredients are in place for a successful democracy in the Middle East. There’s a combination for a civil war, not democracy. The chaos in the region is exactly what the radicals want. We’re likely to first see civil wars, then Islamist regimes, then cross border wars.
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