Blanchard y la crisis

Con sus más, con sus menos, cada una dirá, pero es un muy buen texto para organizar un poco las ideas y seguir de cerca la opinión del FMI. Lo publicaron ayer.

Para entusiasmarlos en su lectura nada mejor que sus propias palabras:

The best way of motivating the lecture is to start with the chart in Figure 1. The first bar (which is barely visible) shows the estimated losses on U.S. subprime loans and securities, estimated as of October 2007, at about $250 billion dollars. The second bar shows the expected cumulative loss in world output associated with the crisis, based on current forecasts. This loss is constructed as the sum, over all countries, of the expected
cumulative deviation of output from trend in each country, based on IMF estimates and forecasts of output as of November 2008, for the years 2008 to 2015. Based on these forecasts, the cumulative loss is forecast to run at $4,700 billion dollars, so about 20 times the initial subprime loss. The third bar shows the decrease in the value of stock markets, measured as the sum, over all markets, of the decrease in stock market capitalization from July 2007 to November 2008. This loss is equal to about $26,400 billion, so about 100 times the initial subprime loss! The question is an obvious one: How could such a relatively limited and localized event (the subprime loan crisis in the United States) have effects of such magnitude on the world economy?*

* Ironically, the other shock which dominated the news until the financial crisis led to the opposite question:
How could the very large increase in oil prices from the early 2000s to mid-2008 have such a small apparent
impact on economic activity? After all, similar increases are typically blamed for the very deep recessions of the
1970s and early 1980s. The plausible answer, which I shall not explore in this lecture, but is very much worth
exploring, must be that the economy has become less fragile in some dimensions, more fragile in others.