Heightened Political and Geopolitical Risks

Niall Ferguson, Hoover Institution Senior Fellow, tells us about rising political and geopolitical risks in the US and how to navigate markets in an election year. He joins David Westin on "Wall Street Week" daily.

[@RN-lo6xc]

Niall is one of the best in the business - supremely timely analysis

[@randomdude7384]

Epic host. Go, Katie!

[@milosnestorovic1594]

Political and Geopolitical Risks, it is Absolutely Normal and Real now, it is clear and reality, and inevitable...

[@handerson3263]

Ferguson is what we in the uk refer to as a knob.

[@ziv2liv]

I cannot even start counting how many times Niall Ferguson was wrong in his predictions.

[@RN-lo6xc]

Name one thing he is wrong about in this show.

[@ziv2liv]

@@RN-lo6xc For one, you cannot categorically claim that geo-politically, the 70s were much more dangerous times than today. You simply don't have the historical depth to judge how much in danger we are today. I would argue for instance, that given the extreme political polarization that we are in now, can bring us much more danger, but even globally, we have several conflicts that can easily escalate to much, much wider conflits.
As for Ferguson being consistently wrong, Back in 2009-2010 there was a prolonged debate between Ferguson and Krugman about the remedies to the collapsed economies as result of the 2008 debacle. Krugman argue that the quantitative easing was essential, Ferguson argued that economic austerity is the solution. The US applied quantitative easing while the UK used austerity. In the end, the US recovered WAY faster and better than the UK.

[@RN-lo6xc]

@@ziv2liv You bring up arguable points, not definitive ones. You cannot definitively claim he is wrong in his assessment of the 70s as more dangerous than today, for example. You bring up polarisation, but that is a value judgment. It is not as if the protests of the time reflect an unpolarised demos. It is also not the case that the conflicts in Ukraine and Israel betray more danger of escalation than confrontation with the Soviet Union. Ultimately, you may be right. Or I may be. Or maybe neither of us is. But that doesn’t mean you can say his assessment is wrong. It’s a matter of wait-and-see. As for the post-2008 debate, the US economy recovered because it is the US economy. It is poor practice to compare the US to the UK in this regard, as there is absolutely no way to control for all the other variables in this equation. The USD is the reserve currency, which gives the US tremendous leeway. Even so, the QE programme brought with it a ballooning debt burden which is today the main source of instability in the US economy. The jury is still out for whether this form of state overreach is helpful long-term. In any event, the true test for who was right is to model how the US economy would have fared if it implemented austerity measures, not comparing apples to oranges. I think the post-Covid stimulus militates against unbridled Keynesianism given the bout of persistent inflation we see now. So does this show Krugman was right? Absolutely not.