When considering the source of this research, the title and employer of the author mean a great deal.  By definition, Citigroup can and will attract some of the brightest economic minds on the globe and can afford to pay for it…therefore these ares not the idle musings of an arm-chair pundit.  Normally, 3rd place wouldn’t be anything to celebrate.  However, if in a few decades our current $14T+ economy is only the third largest in the world then the global economy is about to go on one hell of a rocket ride.

“We expect strong growth in the world economy until 2050, with average real GDP growth rates of 4.6 percent per annum until 2030 and 3.8 percent per annum between 2030 and 2050,” Buiter wrote in a market research.

“As a result, world GDP should rise in real PPP-adjusted terms from $72 trillion in 2010 to $380 trillion dollars in 2050,” he wrote.

If things do play out as optimistically as this then it truly should be something to celebrate as companies (and their employees) will find more and bigger growth in their international markets almost as far as the eye can see – talk about a tailwind at your back.

Anecdotally, I do meet and speak with C-level executives on a weekly basis throughout Michigan and it does seem like the companies that have developed a global marketplace for their products and services are enjoying a fantastic upswing out of the Great Recession. This kind of research report can only help underpin reasons to think it should continue.

In my own view it seems a bit Pollyannish as I’ve been around long enough to know that unfettered compound growth rates  only seem to truly play out in the ivory towers (unless one is on the tuition fees committee of every major college).  Moreover, the report doesn’t address how we will manage the resource requirements to get there – save cold fusion or a breakthrough in AI – like the Singularity described by Dr. Ray Kurzweil. 

However, I hope he’s right because it would mean truly unprecedented economic bounty for the one country on earth that will benefit the most from a “rising tide” of Western consumerism spreading around the globe – the USA.  Plus, it feels good to find reasons to be optimistic.  In the spirit of unbridled capitalism I can already see the T-shirts now, “We’re #3 and that’s OK”.

http://econ.st/eQOGoE

What a brilliant concept.  I think this is a great idea…maybe impractical for the 99% of us that have to earn a living by showing up and doing something 60+ hours a week but a great concept to explore nevertheless.  I’m an avid reader of non-fiction (and occasional fiction): memoirs, economic history, fictional history, business/mgt books and I, too, have seen how seemingly unrelated concepts can help dust off a barely recalled memory from a book or magazine article read months or years ago.  I’m sure many more intersections of ideas skim off the margins of my mind from long forgotten memories of books read years ago.  Johnson has a clever and succinct way to describe the outcome of such a vacation of the mind: private serendipity.

I’m a bit disappointed in the chapter Bush put together about the financial crises. He is attempting to walk the reader through some of the decisions he made to intervene into the market. I’m not writing to criticize what he did with respect to injecting banks with fresh capital and bailing out GM & Chrysler. Moreover, with a bias towards Adam Smith-type markets and plenty of Milton Friedman sprinkled in I was initially shocked at the level of Federal Government intervention, but to do nothing and watch these companies and banks dissolve would have surely been a gamble we would have regretted not taking -especially living in the “manufacturing ground zero state” of Michigan….which is why I wanted the real meat behind those decisions and what was said behind the closed doors of the Oval Office. I wanted to learn something new with a ringside seat at history being made. I didn’t find it. Almost everything Bush wrote about in the final chapter was heard and/or read before by most people following the news closely (aka glued to CNBC.com streaming video). I just don’t understand why he didn’t share more novel details of why his administration decided to change TARP from a troubled-asset relief purchase program to a capital injection program. That was more than just a one or two sentence decision he gave in the book. I also wanted a lot more to chew on with respect to bailing out GM & Chrysler. He didn’t even mention Rick Wagoner’s name in the book. Those who have criticized Bush in the past about being too high level, if not aloof, are going to be feel somewhat vindicated if this chapter is a good proxy to the rest of the book. For example, Bush justified (in part) the federal government intervention into the banks and car manufacturers because the “free market had failed.” But I would argue that the market was doing exactly what it was supposed to – punishing companies and decision makers for assuming asset prices only rise in value and manufacturers can have runaway entitlements with out-of-control pensions, wages, and employee benefits while losing market share at the same time. About the only thing new I learned was that Robert Gutierrez was much more instrumental in this whole crisis than I would have initially guessed and I’m seeking out Mr. Gutierrez’s reflections of those days to offset what I didn’t learn from Bush’s memoirs.

What is Bernanke? I fear we will only know by looking in a rear view mirror.