By Stephen S. Roach, 24 April 2006
The world has avoided a major financial crisis for more than seven years. This is due more to luck than design. With oil prices surging, central banks leaning against the upside of the liquidity cycle, and global imbalances mounting, that luck may now be running out. Globalization is, by definition, a dynamic process. That’s especially the case in today’s era of IT-enabled globalization that is redefining the very concept of economic and financial market integration. Globalization is in need of a new architecture, but the powers that be are taking only baby steps in that direction. With the odds of a disruptive global rebalancing high and rising, the world can ill afford to gamble with a piecemeal approach to architectural reform.
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