Tomorrow, Tuesday December 2, at 4:30pm (please note special start time for this week), we will webcast our next MIT class on the global crisis. The session will run until 7pm, as usual, with a break around 5:30pm.
This is the last class on the crisis that we will broadcast & record, at least for now. (There will also be a class on Tuesday, December 9, which will review the crisis to date; I’ll post summary materials but that session will not be recorded.)
On December 2nd, I plan for us to cover the following topics:
- The Citigroup Bailout, including whether this is or is not good value for the taxpayer (search this website for Citigroup to see readings). Robert Rubin’s interview with the Wall Street Journal on Saturday is also essential reading (the WSJ article requires a subscription; the blog naked capitalism provides a free summary and some reactions worth discussing.
- The situation in Europe, which continues to worsen. We’ll review the latest developments in the real economy and indications of various kinds of pressures (think: Italy, but the UK, Spain and other countries may well come up).
- Prospects for global financial system reform. We can see fairly clearly the strategy of President-Elect Obama’s team with regard to fiscal policy, and we can infer some implications for monetary policy. But what is their likely global strategy, with or without the IMF? How does this fit with what the rest of the G7 or emerging markets or any other influential players want? Can we see a full overhaul of the global system coming soon? If not, why not? (Search for Global Reform on this website for readings.)
Feel free to post questions here or email to us, through this website. We’ll cover as many as possible in the classroom discussion.
Details on the webcast and some potentially useful background follow:
The RealMedia stream for Tuesday afternoon will be:
RealPlayer version 8 provides all required functionality for viewing this webcast. Here’s a link that provides some verification resources for viewers of RealMedia content: http://web.mit.edu/smcs/help/realhelp.htm
A recording will be available to download later in the week, probably on Thursday.
And, in case it is helpful, here is a summary of our MIT Global Crisis class materials on the web so far:
#1, October 29: The slides I used are available on the web. This session was not recorded.
https://baselinescenario.com/2008/10/29/mit-class-1-on-global-crisis/
#2, November 4: Video available, with summary of discussion:
https://baselinescenario.com/2008/11/06/downloadable-mit-class-on-the-global-crisis/
#3, November 18: Class outline is in the first link; video is in the second link
https://baselinescenario.com/2008/11/18/session-outline-mit-global-crisis-class-at-4pm-today/ https://baselinescenario.com/2008/11/21/video-of-tuesdays-mit-class/
#4, December 2: see materials above and postings to follow
Note: original course plan was posted at the end of October, but more than a few things changed in the world since then:
https://baselinescenario.com/2008/10/28/mit-global-crisis-class-outline/
If you read this far, hopefully you know that the readings for the class are the postings on this website in general: http://BaselineScenario.com. Structuring and opening up a MIT course in this way is an experiment. Based on your feedback (e.g., posted here or emailed to us or otherwise sent to MIT Sloan), we’ll either do something like this again or not.
The Baseline Scenario 
Briefly, as a non-economist, I have become addicted to this site. Hardly any day passes without me checking at least a few times on the latest updates. I think it is very important for the public at large to understand the fundamental issues concerning the economy. This knowlege will only help us prevent future disasters like the current one (hopefully). The work of Simon Johnson and all the others involved here is a great public service to us all and quite exciting. Thank you, and please please do not cease your wonderful efforts.
One concern I have which arises in the context of the Citi bailout is the existence of the so-called “shadow banking system”. One continually hears about “off balance sheet” assets.
How can there be such a thing? How can banks and other institutions be allowed to have assets and liabilities which are not present on the balance sheet? What has happened to the accounting standards in this country (in the world)? How can investors and others concerned about the financial health of institutions possibly make reasonable assessments if much of the pertinent information is not even publicly presented on a companies financial reports?
Please continue to participate in making MIT courses available to the public. MIT Sloan has made a valuable service to public discourse at a critical time in our nation’s history.
Providing Internet access to your classroom is a great idea. Please keep it up!
Ditto to Joe Sofer’s comments. I am extremely addicted as well and it is one of the few sites I look at daily. My days are crazy and it’s good to have a site I can go to that will give me a brief summary and commentary on the daily economic issues in “plain english”. The links to other sites help sort through the thousands of sites out there. As for a comment Tom K made in a previous post (sorry, I can’t remember which one or the exact comment) about the lack of comments, I think it may be due to people like me who read this all the time but don’t necessarily feel they know enough to add a comment. One thing I like about this site is that it DOESN’T have a lot of “useless” comments (the clutter of comments on other blogs usually discourages me from reading them because you have to sort through so many random ones to find a few interesting ones). The few people that comment on this site generally have something to add or say, not just a comment for the sake of posting a comment (of course this comment I just posted contradicts that… but I wanted to make sure your receive the feedback you asked for – let’s say this is my “vote” to keep the site going!) Please keep it up! This is an extremely usefull gathering of information, commentary, links and resources for your average joe (or jane) like me.
This website does an invaluable service in educating the public about the financial crisis. It is a great gift to put information of this quality into the public domain. This blog empowered me to have an intelligent discussion with my Senator’s staff about the crisis. Thanks and Kudos to Simon Johnson, Peter Boone, James Kwak, and MIT.
Please record 12/9 lecture as well!
To chime in with the chorus this site is a tremendous public service. The video classes in particular are a type of detailed, reasoned analysis that can’t be found anywhere else. Keep them coming please. If you get a chance in class I’d love to hear a discussion of the probability that this crisis will ultimately lead to a failure of fiat money due to excess monetization as treatment for the patient. What effect would a return to gold standard have on the world’s markets and currencies? Are there any realistic scenarios of a non-fiat currency based on something other then gold? (ie basket of commodities)
Contrary to the other commenters on this blog, I find Mr. Johnson’s analysis of the “global crisis” surprisingly provincial and simple minded.
The global economy is in the midst of a collapse of a global asset bubble that was fueled by excess leverage, low interest rates and large transnational flows of capital and credit.
Since the asset bubble was global and the result of large global financial flows, one would expect Mr. Johnson to try to understanding the crisis from the perspective of how global financial forces and linkages created the bubble and how they are likely to act as the bubble bursts. The fact that the financial and credit markets of nearly all trading economies have become integrated and are in aggregate largely unregulated are a big factor in the bubble and the unwinding of the bubble. Understanding those linkages and transmission mechanisms would be a good place to start in understanding the crisis and how to solve it. Instead, Mr. Johnson engages in a lot of ambulance chasing, reacting to local crises of the day.
To be truthful, I have a hard time believing that Mr. Johnson is actually an economist.