David Smick keeps a low profile, but experts consider him one of the most insightful financial market strategists in the world. For more than two decades, he has conferred with central bankers (such as Alan Greenspan and Ben Bernanke) and advised top Wall Street executives and investors, from George Soros to Michael Steinhart to Stan Druckenmiller. Political leaders (from Bill Bradley to Jack Kemp) have regularly sought his policy advice.The World Is Curved picks up where Thomas Friedman's The World Is Flat left off, taking readers on an insider's tour through the private offices of central bankers, finance ministers, even prime ministers. Smick reveals how today's risky environment came to be -- and why the mortgage mess is a symptom of potentially far more devastating trouble. He wrestles with the two questions on everyone's mind: How bad can things really get in today's volatile economy? And what can we do about it?Drawing on riveting anecdotes in language anyone can understand, Smick explains:How the churning cauldron we call China (the next great bubble to burst) represents a powerful threat to everyone's pocketbook How Japanese housewives have taken control of their nation's savings, and why it matters to us How greed-driven bankers and investment bankers have put everyone's pensions and 401(k)'s at risk Why today's "incredible shrinking central banks" may not be able to save us when the next crisis hits Why the big-money Russian, Chinese, Saudi, and Dubai sovereign wealth funds represent a tectonic shift in global financial power away from the United States, Europe, and Japan Why the world desperately needs a "big think" financial doctrine to guide today's dangerous ocean of money The World Is Curved is the rare book that speaks simultaneously to the Wall Street, Washington, and London elite, yet its apt storytelling shows Main Street readers how to survive in these turbulent times.
World Class This is an excellent book. The author keeps you focused and moving from chapter to chapter without much repetition or minutia. The topic is covered with exceptional detail and in the end leaves the reader with invaluable insight.
Simply put, it's an essential topic and a good read.
- Unfortunately, it seems that some of the amazon reviews are motivated by something other than the topic at hand. The author has loaded this book with data points, many of which I have not seen elsewhere, and I'm in the business. To criticize the book for not adding anything to the topic is nonesense. Yes, the man worked with Republicans, but he also worked with and praises the Clinton Administration. This is not a book on politics, and when reviewers attack based on references to "delusional" right wingers such as: .... Alan Greenspan??? Wow... ...more info
Globalization and why it should be saved Excellent overview of the current (29 Sept 2008) macroevents and the how we got here. Fascinating for me as I remember the 70's gas lines and lived in DC in the 80's -- Mr. Smick, clearly walked the halls of power and understand how we got into this mess. Note - he seems to be quite balanced in that both Dem's and Republicans are at fault. He gives Bill Clinton a lot of credit for pushing thru NAFTA, Welfare reform and cutting Capital Gains by 30% thus allowing all of us to benefit from globalization.
He also suggests that China is in a large bubble and what the impact is to us. I was there a few years ago and they and Dubai are clearly over the top (dot commish even) so it will likely get ugly for all of us when China blows.
The only disappointment I have is the last chapter "Surviving and Prospering in This Age of Volatility". This is about how to govern better not what you can do in your personal investments. Interesting but not something I can act on, except perhaps voting.
Best quote was from Marc Leland, former US Treasury official... "Globalization is like the two institutions we know as democracy and marriage. Both institutions at times can be problematic, but the alternatives are highly unattractive" Reminds me of Churchill's famous quote "Democracy is the worst form of government, except for all those other forms that have been tried from time to time."
Lacks Depth. Not much to be learned from reading the book. Save your money. You could select any other book on economics or risk management on Amazon.com for more information than was provided in this book....more info
Ask Your Grandmother Insights Don't let the hype fool you - this book is absolutely useless -- unless you want to endure pages and pages of Smick's dinner exploits, travel arrangements, hotel stays and endless name dropping. Here's the key messages of the book:
The Global financial marketplace is complex, so don't muck with it or the world might break
America, China, Japan, Europe, India, Brazil might be tempted to raise trade and financial barriers - that might muck things up and the world might break
We need more Chuck Shumers and Bill Clintons, anyone else might muck things up and the world might break
Those that can do, those that cannot - CONSULT - like Smick.... ...more info
Fast shipper I recieved my book a week before it was estimated to arive. This seller does not sit around and waste your time....more info
Author is a Clinton apologist Just received and read the book. What a pile of garbage. The author is a dyed in the wool Clinton apologist. Every Clinton hack appointee has recommended the book. Author actually compared Clinton to Ronald Reagan, what a putz. He even had the audacity to quote the New York Times, implying that it had any credibility. Good thing winter is coming, I'll save it for kindling....more info
The World is Curved An outstanding book regarding the global financial system that has created great prosperity around the world, but could be in danger of collapsing....more info
Not because of content.... I wouldn't know whether this book is good or not. The reader seemed adequate, if not terrific. But, 3 of the first 5 discs had flaws and skipped and sputtered and made whole sections incomprehensible. We had a car trip ruined....more info
I agree, an "Economic Elitist Perspective" A good read, a good yarn (exception: the sychophantic fawnings and name-dropping.) The most bothersome point is Smick's insistence that hedge funds etc. be allowed to do their magic unimpeded because the system promotes entraprenurial innovation. So what innovations have we seen in the past few years, other than fancy cell phones? How about innovations in affordable health-care? Low-cost housing? So the sop to the middle class for being terrorized by financial instability is to promote ownship. Presumably, owning shares will make them feel better when they lose their jobs. ...more info
Some Good Insights; Not Totally Satisfying I began reading The World is Curved with great hope and anticipation. The book has some good insights, but in the end I felt disappointed. Smick's basic points include:
- Global capital today flows from one investment to another in the blink of an eye, regardless of borders or culture. As a result, central banks have less control over their economies.
- Global capital exceeds the number of good investment opportunities, creating the potential for bubbles (i.e. too much debt has expanded the worlds money supply beyond what's financially healthy).
- The securitization of debt is a primary villain, because the bank that originates the mortgage suffers no consequence if the loan goes bad. (But I worked at Countrywide in the mid-1990s - they were securitizing mortgages back then and there were no problems at that time).
Smick says that the bond rating agencies and the government regulators were simply not up to the task of anticipating the problems. In reality, some Republicans belatedly questioned the lending practices that were occurring pre-meltdown, but the Democrats in power at the time denied there were problems! These same Democrats are still in power today.
Smick expresses concern that the current political trend is toward over-regulation, protectionism and class warfare, all of which will cause the global pie to shrink. And we don't want "financial executives working desperately to avoid civil suits and criminal prosecution."
In my opinion, a good share of the blame must go to Alan Greenspan who kept interest rates too low for too long. Smick does a good job of trying to protect Greenspan from criticism. I agree that Greenspan did a good job for most of his career, and multiple factors contributed to the today's meltdown, but I can't ignore his obvious role in creating this fiasco. But then again, I don't have a book with Alan Greenspan's glowing endorsement on the cover either!
Smick says the solution is to have smarter politicians, like Democrat Charles Schumer. Smick's opinion is based, in part, on Schumer inadvertently insulting a Japanese audience. If this is brilliance, then no wonder the world is in trouble.
Unlike Smick, I WANT the upcoming crop of financial execs to fear "civil suits and criminal prosecution." If the system is too complex for regulators and politicians, then the only thing that will bring prudence to the financial elite is the threat of punishment for screwing up.
Sadly, the financial policies of Bush and Obama are geared toward maintaining the status quo by further borrowing, and by giving money to the very people who got us into this mess. In the end, we'll have more bubbles and greater financial problems. I agree with Smick that too much regulation will kill the golden goose and we need to encourage entrepreneurs, but I walked away feeling that Smick, who is well connected to the world of high finance and politics, is part of the problem, rather than part of the solution....more info
The World is Curved I thought it went a long ways in explaining the problem with subprime loans in a way that was understandable...more info
Well written Easy and interesting read on the present financial crisis.
Only drawback for me is that it contains much on China which is not very well researched....more info
Bubble The book is an almost timely look behind the scenes at the world's financial bubbles. It was published after the subprime crisis but before the collapse of Wall Street's investment community. The author attempts to justify the continued practices of this community while calling for inspired attempts to regulate it. He has no real suggestions on how this could be done. He defends the system as moving people out of poverty in great numbers defined by those who no longer live on less than $1 a day. I would suggest that living on $2 a day is no less a reasonable definition of poverty....more info
Economic Elitist Perspective Smick details and justifies the narrow, self serving elitist' economic global view (the 10%) while ignoring the destructive effects of global economics on the lives of the "little people" (the 90%). It is a facinating read giving details of global economics while attempting to appear benign.
The problem speaks The World Is Curved is a self-aggrandizing story about the world of international finance and economic globalization, told in mostly the first person, by David Smick--one of that arenas major players and beneficiaries. It reflects what is the essential problem of the world economic situation but, not unsurprisingly, Smick fails to see that it is HIM and his kind--i.e. self-absorbed and unaware personalities globe trotting and using the latest technology, to pursue the accumulation of wealth for personal status--that has brought the world to the brink of serious depression, both economic and psychically. Oh, he does point the finger at "greedy" bankers and financial "wizards," but doesn't see his connection and complicity. He is a "consultant" and advises "some of the world's most successful money managers." I'll be clear, the author depends on making his living and enjoying a royal jet-setting lifestyle on the super rich maintaining their status and well-being. He trots out the tired old line about the creative class needing the money of the super rich to do what they do; but admits that creative people aren't motivated by money or wealth--just the doing of the thing. But, let me be real, the "investors" are merely interested in getting in on a potential money-maker. They buy low, create a buying frenzy via the oldest trick (thus the wizard label) of the confidence game--fear of losing out-- then sell high and move on. He advises them. He says they must enjoy a high level of confidence (ebullience) that this "system" continues as is, to keep funding innovation. This, of course, creates the bubbles that have dominated the world economy for the last dozen years and created the problem--money out of thin air. I list here some of the bubbles: Dot Com; Telecommunications; Housing; the Stock Market itself. To be clear, again, many people have gotten very rich, but most have been fleeced and NOW ... one of Smick's remedies is to have the government (the people) tax themselves and then give themselves a "gift" upon birth to be invested in the markets. I can't believe this! That money most likely will wind up in the pockets of the already rich and their wizards and bankers. AMAZING! (Does that declaration mean five stars?) What a crock, what a confidence game! One of the tricks these "wizards" use is specialized jargon. For instance, who knows what these words mean in the language of finance: Equity; Capital; Liquidity; Investment; Trust; Leverage; Human Capital; Inflation; Economy; Entrepreneurial; Securities; Sovereign Wealth Funds; Risk; Securitization; Free Trade; Bond Markets; Hedge Funds? Smick even admits the people in charge often don't even know what they are talking about when they use the words!!!!
This book is a classic. It is about the liars and thieves who have fleeced the people of the world, albeit as Smick contends again and again, without knowledge or intention. So are they innocent? Just jerks doing what jerks do? I would like all these bankers and wizards and their beneficiaries, stripped of their wealth and given shovels to manage manure, dig ditches to move water, and build roads and foundations. Let them earn a living. That would boost my confidence. DON'T BUY THIS BOOK....more info
Very readable introduction to modern international finance First, the con: Smick is totally full of himself.
Pro: Very readable introduction to modern (up through Bear Stearns) international finance. To borrow the author's favorite metaphor, he channels a wide and deep river of facts, theories, opinions to describe the impact of the global ocean of money that surges through the financial world and influences everything.
My financial background: None. I can't speak to it's suitability for experts, but it's accessible to the motivated lay person....more info
The World is Curved David Smick tells it the way it is, I wish I had read this book before the down turn.
I will recomed that you read this book if you are looking for answers to what may be next....more info
Wide ranging, authoritative, timely, insightful Smick goes beyond the mainstream media's elementals of subprime crisis 101 and focuses on the crisis as a phenomena of international economics, global liquidity and money flow. Prescient, he fingers potential weakness in China banking, the withering of power of central banks, the huge growth of global liquidity, a possible repeat in the US of a Japanese banking scandal as in the 1990s, the rapid movement of money across borders and a credible even handed explanation of the deft monetary management and policies of Alan Greenspan. Mixing personal anecdotes and conversations with the world bankers and investment leaders, his sharp analysis and criticism is coupled with a centrist viewpoint tied to a strong advocacy for free market economic policy. His support for entrepreneurial initiative is convincing and highly readable. Defending the free trade policies of Reagan and Clinton and warning of the threat of class warfare, he targets the greed of the Wall Street bankers and their "off the books" securitization as the root cause of a lack of trust in the financial world today. Sensing a Democratic takeover in November, he warns against the recent populist attacks on free trade and governmental overregulation and interference. This is a book chocked filled with good sense and sound advice. ...more info
All the endorsements are a mystery to me Based on the endorsements for this book I assumed I would be getting an in depth description of how international finance worked and maybe a clue as to why so many were worried about trade deficits and the possible demise of the dollar.
Instead, what I got was more boosterism about free trade, globalization, and entrepeneurship - and warnings to politicians to not mess with this glorious world. No nuance. Very shallow.
Why it received so many prominent endorsements is a mystery to me. Rather than educating, the book just promotes political viewpoints.
I would not like to see free trade disrupted, but I have read all his arguments a hundred times before....more info
world is curved excellent book about the current economic and credit crisis- what to do and what not to do in solving it. the future dangers (and possible opportunities ?) are discussed as is the dangerous disconnect between the political system and economics, somewhat mirroring Friedman's ideas in "The Earth is Flat." The dangerous delusion that impotent governments and central banks can control economies and credit with oceans of money that can move anywhere virtually instantly with a mouse click is disculssed....more info
World Economics for Dummies 101A The world is curved is filled with easily understood facts and figures but will astound the unknowing person. We are being kept in the dark by the drive by media and this book will shed light on our faultering economy. This is a good read....more info
great book If you wish to understand globalization and the global economy,
this book is for you. Well written, wordy in parts, but a good
reference as well....more info
In the land of blind, the one-eyed is king This book will delight anyone who enjoys reading Greenspan. The first 100 pages are simplistic banal ECO001 clich®¶s disguised by the magic of the written word as "powerful deep thinking" and highly recommended as a much safer alternative to sleeping pills for the insomniac bibliophile.
Even better, the sleeping pill has been especially designed for disciples of Greenspan, Paulson or Bush: all the financial delusion/fantasm they share are present and this will comfort the typical Wall Street reader in these troubled time (the book was released sep 4, 2008) and lead them in an (at last) comforting sleep.
Especially, when the eminent author compares China, which banks
"do not understand credit risk management, not to mention even the rudimentary rules of financial transparency"
"large American and European financial institutions" that "look like paragons of financial purity". (p. 108)
You can hardly be more delusional than that!
The author is remarkably candid about his ability to evaluate the global economy. When he learned on aug 10, 2007, that inter-bank loan market had seized and the stock market had dropped 3%, the author, who "confers with central bankers (such as Alan Greenspan and Ben Bernanke) and advised top Wall Street executives and investors", reasoned:
"None of this makes sense, I though. The markets had become hysterical over losses in the so-called subprime market...why a near-global market meldown and a collapse of lending simply because of some mortgage foreclosures? After all, the problem loans amounted to, at worst, $200 billiom in exposure in a global market worth hundreds of trillions"
Sorry, but any reasonably alert investor who would have read Buffett 2002 letter to investors, or listened to Nouriel Roubini (IMF 2006) would have known exactly what was going on ... months in advance!
That smart investor only had to put his money in his mattress and he would have made more money during the ensuing 1.5 year than the sum of the 4 largest investement bank and 5 biggest bank in the world COMBINED, institutions, let us remind, repleted with "genius traders", managed by CEO worth $10 millions/yr, and last, but not least, enlightened by highly paid consultant such as Mr Smick.
The author was a consultant to Greespan and Bernanke and hadn't a clue on the importance of the bursting of the housing bubble and its amplification by the derivative structure even in the month leading to it. Unbelievably frightening reality.
Before completing the book, I had read enough. It was clear that this book's return on investment (time and money wise) was already too negative to continue.
I will retun it for a full refund. I feel it would be immoral and unconscionable to financially support such writing.
One could wonder why such as book got such lavish endorsement by Greenspan, Trichet, Summers, etc.
The author by initiating international banking conferences acted as a middle man between a significant number of high-level financial personalities. True to form, the book contains a few sycophantic pages on each of them to the point that one could be easily led to believe that the true purpose of the book is a public relation exercice to rescue the reputation of the financial actors involved. Highly grateful, they, not surprisinly, are enthusiastically "endorsing" the book.
And surely, those people are indeed in desperate need of hagiographers:
Remember Greenspan's deep insight of the financial market? :
"The use of a growing array of derivatives and the related application of more-sophisticated approaches to measuring and managing risk are key factors underpinning the greater resilience of our largest financial institutions" (Greenspan, May 2005)
Remember Trichet management at Credit Lyonnais?:
Trichet was prosecuted because as "directeur du tr®¶sor" with the complicity of others he had knowingly signed on a falsifed 1992 annual report of the nationalised Credit Lyonais which dramatically reduce its loss and therefore adroitely prevent it from becoming insolvent. He was later rewarded for his brilliant service by being named head of the French Central Bank and the entire world was waiting for him to take the helm of the European Central Bank when, very inconveniently, a stubborn prosecutor continued to press the case forward which threatened to prevent France from having its man at the helm of the ECB. In the end some others were given slap-on-the-wrist sentences and he was himself completely absolved (in 2003) by the judge (the defense being more or less that he had notified/warned the board of director), conveniently just in time to take on his new job.
Simplistic and Data-Free, Loaded with Name-Dropping! Smick's book starts out with a massive error - sub-prime loans amount to, at worst, $200 billion in the global market. Therefore, the panic that has since unfolded is because it is unknown which institutions held what sub-prime loans. Actually, experts say that "credit default swaps" became at least a $50 trillion market that was primarily betting that sub-prime loans would go sour; investors could bet multiple times on the same loans and didn't even have to own any of the loans.
The rest of the book is non-stop, largely erroneous, conservative philosophy, with nothing to back up its assertions and quotations.
Example 1: Smick tells us that some estimate the U.S. is $10,000 richer per household/year because of free trade. That claim is obviously ridiculous, given the millions who have lost jobs, health, and pension benefits due to free trade.
Example 2: Smick asserts that large turnarounds appeared in India and China after both lowered tariffs. Again, a ridiculous point - India and China improved after they became more capitalistic and WE lowered our barriers to imports.
Example 3: Smick claims that American so far has been a massive net "insourcer" of jobs because foreigners invest $0.5 trillion more in the U.S. than vice-versa. How does China, etc. buying existing American companies create more jobs? (The best-known "example" is their buying a defense-critical magnet firm, and moving it to China.)
Example 4: Smick tells us to imagine foreign graduate students are banned from U.S. universities. Within several years, the U.S. becomes far less innovative. Smick makes this claim without any data support - eg. what proportion of foreign graduate students return to their homeland, boosting their competitiveness? (It's risen considerably now that China and others have strong economies.)
Example 5: Smick wants us to imagine a tax on imported goods from economies with high carbon emissions (eg. China). China then retaliates with a tariff on the American agricultural sector, claims Smick. Problem - the U.S. is now a net food importer from China, and thus American farmers would welcome such a move.
And on and on.
What was most troubling about Smick, however, was his bragging about being an economic advisor to President Reagan at age 26. (Actually, a three-day gig, riding on Jack Kemp's coattails.) Yet, his biography lists no academic training whatsoever, and his first two positions were that of speechwriter. Then he became Chief of Staff to Rep. Jack Kemp. Why should anyone, especially a president, believe Smick has the knowledge and credibility to warrant listening to him?...more info
AARP Crash Couse in Estate Planning Excellent overview of a complex subject. Relatively easy to read with lots of examples. ...more info