My morning read; global economics, leadership, and sex

This morning, over at Bloomberg, Mohamed A. El-Erian reports on the Fed’s upcoming Jackson Hole meeting; where he expects to see a shift away from policy announcements in response to current events and a return to “academic-type deliberations that tended to precede the formulation and announcement of policy initiatives.” Janet Yellen might not even be there, he reports; but I suspect she’ll be at the next gathering, when the World Bank meets in Lima, Peru.

El-Erian’s take is that the current chaos in markets is too soon, that waiting until October for policy announcements lets the China market churn cool off a bit. After a week of turmoil characterized by outsized moves in financial asset prices and spiking volatility, there is an enormous appetite to hear policy makers’ views of the two huge concerns that have shaken market confidence: Spreading evidence of a slowdown in global growth led by increasingly generalized weakness in the emerging world (with a particular emphasis on China); and concerns that central banks no longer have sufficient policy ammunition to continue their policy of repressing market volatility, boosting asset prices and inserting a buffer between prices and the more sluggish economic fundamentals.

Over at the NYT, Krugman describes this as a glut; and does so through the lens of how American’s seem to think they’re outside the global market:

Still, investors are clearly jittery — with good reason. U.S. economic news has been good though not great lately, but the world as a whole still seems remarkably accident-prone. For seven years and counting we’ve lived in a global economy that lurches from crisis to crisis: Every time one part of the world finally seems to get back on its feet, another part stumbles. And America can’t insulate itself completely from these global woes.

But why does the world economy keep stumbling?

Krugman goes builds a case of too much capital chasing too-little growth, causing repeated bubbles.

What’s causing this global glut? Probably a mix of factors. Population growth is slowing worldwide, and for all the hype about the latest technology, it doesn’t seem to be creating either surging productivity or a lot of demand for business investment. The ideology of austerity, which has led to unprecedented weakness in government spending, has added to the problem. And low inflation around the world, which means low interest rates even when economies are booming, has reduced the room to cut rates when economies slump.

Whatever the precise mix of causes, what’s important now is that policy makers take seriously the possibility, I’d say probability, that excess savings and persistent global weakness is the new normal.

Next, I went to another NYT editorial; this time from guest-writers Rohini Pande and Charity Troyer Moore, on why more women aren’t working in India.

Usually, economic growth in lower-middle-income countries creates more jobs for women. But as India’s economy grew at an average of 7 percent between 2004 and 2011, its female labor force participation fell by seven percentage points, to 24 percent from 31 percent. Despite rapidly increasing educational attainment for girls and declining fertility, the International Labor Organization in 2013 ranked India 11th from the bottom in the world in female labor-force participation.

Research shows why this matters: Working, and the control of assets it allows, lowers rates of domestic violence and increases women’s decision-making in the household. And an economy where all the most able citizens can enter the labor force is more efficient and grows faster.

(snip)

It’s not that women don’t want to work. Our analysis of data from India’s latest labor survey shows that over a third of women engaged primarily in housework say they would like a job, with that number rising to close to half among the most educated women in rural India.

Much of the reason they don’t work appears to lie in the persistence of India’s traditional gender norms, which seek to ensure “purity” of women by protecting them from men other than their husbands and restrict mobility outside their homes.

Perhaps this is why Croatia and Nambia are leading the effort to have change the way the head of the UN is appointed, and there is a push to have a woman fill the job. (This was from yesterday, but I read it this morning).

Until now, the five permanent members of the Security Council — Britain, China, France, Russia and the United States — have bargained behind closed doors to pick from a short list of candidates that is not formally publicized. Those who have prevailed have been palatable to those five governments, a common-denominator criterion that has the potential to doom the chances of more impressive and qualified public servants. Currently, there is not an effort underway to make the process truly democratic by allowing member states to elect the secretary general though a vote. Yet, by opening it to greater public scrutiny, the Security Council would be likely to take into account input and concerns from around the globe.

Whether or not the process is overhauled, dozens of members of the United Nations are pressing for a woman to succeed Mr. Ban, who has been a largely invisible and underwhelming leader. The government of Colombia, part of the roughly 20 percent of countries represented by a female ambassador at the United Nations, is leading an effort to put forward women for the job.

“Gender equality is one of the world’s most serious challenges, an unfulfilled goal that remains critical to advance towards an inclusive and sustainable future,” María Emma Mejía, the Colombian ambassador, wrote in a letter seeking support for a female secretary general.

Yet as is often the case, we struggle to get over talking about women as sex objects instead of opportunity for economic growth. At The Atlantic, Michael Kimmel looks at the structural reasons behind campus sexual assaults and at The Guardian, we learn that most of the (real) women on Ashley Madison were sex workers.

To connect this all together, today’s NYT has an excellent editorial on things we don’t know; The Case for Teaching Ignorance; which makes the case that when we teach science from a position of confidence, we undervalue the things we don’t know.

People tend to think of not knowing as something to be wiped out or overcome, as if ignorance were simply the absence of knowledge. But answers don’t merely resolve questions; they provoke new ones.

Which all left me wondering if there’s also a glut of disinterest in all things womanly except for the sexual; blinding us to the low-hanging fruits for economic growth world wide?

It’s an unknown unknown, as defined by the Great American Poet™, DH Rumsfeld:

The Unknown
As we know,
There are known knowns.
There are things we know we know.
We also know
There are known unknowns.
That is to say
We know there are some things
We do not know.
But there are also unknown unknowns,
The ones we don’t know
We don’t know.

Feb. 12, 2002, Department of Defense news briefing

[Picture via WIki Commons]

ROHINI PANDE and CHARITY TROYER MOORE