The Dynamics of Bubbles and Golden Ages
Epilogue: The World at the Turning Point
The Implications for Theory and Policy 167 Epilogue: The World at the Turning Point In June 2002, as this book is going to press, the world is at the turning point. The decisions being taken at this crossroads will determine how long, how deep and how widespread the current recession will be and whether what lies ahead is a depression, a gilded age or a true golden age. According to the interpretation presented in this book, the installation period of the current fifth great surge ended with the draining of the NASDAQ bubble, in March 2000. The recession that then began to threaten the US economy, developed through the first months of 2001 and intensified after the destruction of the World Trade Center, set the stage for a profound institutional restructuring. It is not yet clear whether the stock markets have seen the worst of their troubles or whether the reconnection between paper and real values still awaits a big jolt or two. But the structural problems causing the recession are already there to be solved, and the Information Revolution is awaiting the appropriate conditions to display the second half of its growth and its wealthgenerating potential. If the world economy is to move towards a phase of synergistic growth, a new regulatory framework is needed, along with the global organizations capable of making it effective. This is a time for institutional imagination. Financial regulation is only a small part – though perhaps the most crucial – in the wide range of...
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