We need the global banking system to keep its promise of sustainable growth, to stay anchored to its capital markets and to stay disciplined, says chief economist and Nobel Prize winner Emmanuel Saez.
In an interview with CNBC, the Nobel Prize-winning economist and author of “The Price of Inequality” and “Capital in the Twenty-First Century” says that while there are times to be confident about the global economy, there are also times to worry that we are heading into a financial crisis.
He said that as we look at our economic future, there is a clear need for our government to stay firmly on track for the next crisis, which could lead to a global recession.
“The risk of a global financial system collapse in the coming decades is higher than most people think,” Saez told CNBC.
The main reason for the risk of this is the lack of central banking stability.
“You don’t have a very stable global financial market,” he said.
“What we are really talking about is the global system in its current state.”
The global financial systems, Saez added, are not “completely sound.”
“We are entering a period of deep systemic change, which is a lot more than just the United States, but Europe, the United Kingdom, China, Japan, Australia, South Korea, South America, the Caribbean, Australia and New Zealand,” he explained.
“These changes are already happening in our global financial markets.
They are happening at a much deeper level than most economists had previously thought.”
Saez also warned against a “bias against global capital markets” that is undermining the ability of governments to keep markets stable.
The world economy has grown faster in the last decade than it has in the previous four decades, and is still growing at a slower pace than it did in the past.
But Saez said that despite the “big picture” growth, the problem is not all the way over.
“This is not a one-time crisis.
This is a systemic problem, which means that a lot of the problems that we have identified over the last few years, that we see around the world, are also occurring in this system,” he added.
Saez believes that while “there is a growing sense that the world is heading for a crisis,” there is also a “lack of optimism” about the future.
In a recent interview with Bloomberg TV, Sizombe said that if we continue to focus on the short-term economic and financial outlook, we are failing to realize the long-term potential of the world economy.
“We need to keep on track, but we also need to have the confidence that our government and our economy will stay on the right track and that it will continue to grow,” he told Bloomberg TV.
“There are times when it is easy to focus, to be optimistic and to be certain that we will be able to keep the economy on track.
But when you are in crisis, there should be a sense of dread that it is going to come to an end.”
He added that the risk is that, in order to remain on track “we need to be able [to] keep the capital markets stable, to keep banks open, to continue to maintain a high level of consumer confidence, and to make sure that the system is stable.”
He also noted that “we can’t let the market fail” and said that, despite a number of global financial crises over the past 20 years, the “main problem that we had was that we didn’t have enough institutions that could provide liquidity for everybody.”
“The problem is that this system is not fundamentally sound, and it is not sustainable,” Sizowbe said.
While there are good reasons to be worried about the economic future of the global economic system, Szombe noted that there are “a lot of things we can do” to help the global community in its fight against systemic risks.
He added: We need a better understanding of what are the risks that are being posed to our system, how much we are able to do to minimize them and to respond.
In addition to the global crisis, Sziombe also said that there is “a risk of an even deeper systemic crisis,” in the context of the broader economic crisis in the United State.
“In the United, there has been a long period of structural decline in the labor force, and there is no evidence that we can restore full employment in this country by the end of the decade,” Sziommbe told CNBC on Wednesday.
“If we keep moving the economy along, we will face this situation again in the future.”
While Saez and Sziomebs are not predicting the global meltdown, they are warning that it could take place as early as 2018.
“One of the risks we have is that we might end up in a situation in which the United Nations is able to set a minimum floor, which will make it impossible for the system to recover,” Szommbe said, according to