Must-Watch: The big surprises that shocked me over the past decade were:
- The lack of knowledge of their own derivatives books–and thus of their own risk posture–at the major money-center universal banks. That turned what ought to have been a garden-variety sectoral episode of financial distress into what will, I think, in the end be the worst macroeconomic catastrophe in history.
- The failure of central banks and governments to take aggressive-enough action to generate a V-shaped recovery–the (completely false) view that once the downturn had been stemmed their proper task had been accomplished and their job was essentially over, and that a V-shaped recovery would come of itself.
But there is also a third:
(3) The productivity slowdown–the fact that, even before 2008, the tide of rapid third-industrial-revolution productivity growth we saw starting in 1995 had ebbed. This I, still do not understand at all…
: Making Sense of the Productivity Slowdown: November 16, 2015: 8:30 am–3:45 pm (ET)…
…David J. Stockton will chair the first session (9:00–10:15 am), focused on understanding the US productivity slowdown…. John Fernald… Jaana Remes… Peter Orszag of Citi… Jacob Funk Kirkegaard… Kyoji Fukao… Marcel Fratzscher… Sebnem Kalemli-Ozcan… Chang-Tai Hsieh… David Ramsden… Lawrence H. Summers… Marcus Noland… Daniel Andrews… Jeremy Bentham… John Van Reenen… and Adam S. Posen, PIIE