The Four Horsemen of the Apocalypse

In this article, published in the Winter edition of “The International Economy” magazine, William White identifies four interrelated and systemic problems, akin to the biblical Four Horsemen, that need urgent and simultaneous attention.  Our economic, political, environmental and health systems are all operating under severe stress. Moreover, their interrelatedness implies that failure anywhere could well lead to failure elsewhere, and potentially everywhere. Where we are is not a good place to be. Recognizing the analytical uncertainties involved, and also the associated difficulties of turning plans into concrete actions, White then makes some tentative suggestions as to how policy might respond to these threats.

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Five considerations for a sustainable recovery

On 16 September, William White participated in a webinar panel chaired by John Orchard, the CEO of OMFIF. Other panelists were Robert Holzmann, the Governor of the Austrian National Bank, Pierre Siklos of the Balsillie School of International Affairs (BSIA) in Waterloo, and Danae  Kyriakopoulou, Chief Economist at OMFIF. The discussion was motivated by a paper, written by William White, and published on the same date by both OMFIF and the BSIA.



Posted by williamw in Presentations, Publications

Unsustainable policies and their remedies: five questions that need answering.

OMFIF and the BSIA (Balsillie School of International Affairs)  jointly published on 16 September a piece authored by William White. He contends that the global economic system, and indeed the state of mankind more generally, is more precarious than is commonly understood. Prior to the pandemic, the economic, political and environmental systems that underpin our democratic and capitalist institutions were already highly stressed. The pandemic, the Fourth Horseman of the Apocalypse, now threatens to trigger “tipping points”  that will not be easy to reverse. White remains optimistic that properly chosen policies can reduce these exposures, but they require answering a number of important questions. Not least, what past policies have contributed to the current, unsustainable state of affairs and should be avoided in the future? Spend and print is not a sustainable solution.

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International financial regulation: why it still falls short.

The Institute for New Economic Thinking (INET) recently published a Working Paper by William White. He argues that changes to international financial regulations, post the 2008 crisis,were undoubtedly useful but still fall short of taming global “boom-bust” credit cycles. A macrofinancial stability framework, in which both monetary and macroprudential instruments were used to “lean against the wind” of credit booms, would seem the minimum requirement to achieve the desired objective. This should likely be complemented by other measures designed to change the behaviour of market participants (including higher capital requirements)and also the structure of  markets themselves. White also notes the shortcomings of individual regulatory changes, and refers to concerns raised about their coherence as a package. The paper concludes with a brief overview of more radical solutions for change suggested in the literature (eg, Free Banking and Narrow Banking) and a final observation. The current International Monetary (Non)System imposes no international discipline to mitigate national tendencies to excessive credit creation.

Posted by williamw in Publications

Simple Lessons for Policymakers from Embracing Complexity

This article will be published shortly as a chapter in a book “New Approaches to Economic Challenges: The Financial System” , published by the OECD in Paris. It is argued in the chapter that economies are Complex, Adaptive Systems (CAS). Such systems are widespread in nature and society,have been well studied by other disciplines, and have many shared characteristics. This communality implies that insights from other disciplines might inform macroeconomic policies as well. Ironically, the embrace of complexity leads to at least ten lessons for policymakers that, while revolutionary,  are both simple and intensely practical.

On 19 August, prior to its publication by the OECD, the chapter was also published as an article in the Swiss financial newspaper “The Market”.


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To what extent will the global role of the US Dollar have changed a decade from now?

William White, together with a number of other economists, answered this question in a submission to the Winter 2020 edition of “The International Economy”.  White notes that the current dollar based regime is decidedly sub optimal, not least because it has no nominal anchor and no reliable lender of last resort, and it needs to be replaced. While there is currently no political appetite to engage in such discussions, the next serious crisis in the global financial system might change this. White suggests that a crucial exposure today is  the massive reliance on short term dollar funding faced by many non US financial institutions. Should this trigger other problems, it might lead to a broader discussion of the shortcomings of the current International Monetary (Non) System.

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Why central bankers should be humble

This article appeared in the Winter 2020 edition of “The International Economy”. White argues that there is a fundamental intertemporal inconsistency in the repeated use of monetary easing by advanced countries to stimulate aggregate demand. This arises from the fact that monetary stimulus encourages the buildup of debt which eventually strangles further spending.  Moreover, such stimulus in the advanced economies has undesirable side effects. It threatens financial instability, has negative effects on productivity growth and can seriously injure emerging market economies as well. Looking forward, there should be greater reliance on fiscal expansion in response to economic downturns, complemented by stronger fiscal contractions in upturns. Improvements are urgently needed in administrative and judicial procedures for debt restructuring, both private and public.

Posted by williamw in Publications

Fault Lines in the Pursuit of Financial Stabilty

This paper will in time be published as a chapter in a book. In the interim it will be forthcoming as an INET Working Paper. It argues that, while significant efforts have been made in the post-crisis period to  to make the global financial system more stable, worrying shortcomings remain. Comments would be appreciated before a final version is decided upon.


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Is a Global Currency War Still Possible?

William White, along with other economists, gave his answer to this question in the Summer 2019 edition of The International Economy. He concludes that “The world has been in a currency war for about a decade” as important central banks have eased domestic monetary policy either to encourage currency depreciation or to prevent appreciation. Whatever the rhetoric about the objective of policy being solely domestic, the end result has been global monetary stimulus of unprecedented magnitude.




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The 2008 Financial Crisis in Retrospect: Panel Discussion

William White made comments in the concluding panel of a two day meeting (August, 2018) in Reykjavik, Iceland. The papers and proceedings of this conference have just been published by Palgrave Macmillan as

“The 2008 Global Financial Crisis in Retrospect”  Edited by R Z Aliber and G Zoega (2019).

Mr White’s comments focus on whether post-crisis reforms to financial regulation have been sufficiently robust. He welcomes the progress made to date but concludes that threats to financial stability remain uncomfortably high.



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