Mortally Wounded? Global Finance and Banking Systems in Crisi
So how different is this crisis? Not different at all, according to Carmen M. Reinhart (University of Maryland professor of economics and former deputy director at the Research Department of the International Monetary Fund [IMF]) and her colleague Kenneth S. Rogoff (Harvard professor of economics and former chief economist and director of research for the IMF). In a paper published in April 2008 titled “This Time Is Different: A Panoramic View of Eight Centuries of Financial Crises,” Reinhart and Rogoff concluded that “the 2007–2008 US sub-prime financial crisis is hardly exceptional.” Perhaps the issue is not whether the system is mortally wounded but whether it is fundamentally flawed. Reinhart and Rogoff have documented nearly a millennium of national indebtedness—public and private—that leads to default, bank failures, currency devaluation and debasement, and inflation.