Feb 06
24
Stephen Roach
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Stephen Roach has another insightful piece on macro-economics on the Morgan Stanley site, that it is well worth reading in full.
It is all about globalization and the fact that there are totally unprecedented things happening right now across the world in terms of labour, inflation, wages, deficits – you name it.
A quote:
A key aspect of this IT-enabled strain of globalization is its speed.
The Internet only came into existence about ten years ago, and yet the
user population exceeded 1 billion people in late 2005, with
penetration ratios rising to around 60% in the developed world,
according to Mary Meeker. Never before has a major technology reached so many in such a short period of time. Students of technology will tell you that’s the norm — that each succeeding wave of technological transformation is accompanied by increasingly rapid rates of dissemination. That was true of railroads, motor vehicles, air conditioning, radio, and TV. The Internet follows that pattern but with an important twist —
it rewrites the rules of cross-border connectivity between developing
and developed countries and it takes that connectivity very quickly
into the once sacrosanct realm of services. For
those reasons, alone, the potential macro impacts of the interplay
between globalization and the Internet cannot be minimized.
The Internet only came into existence about ten years ago, and yet the
user population exceeded 1 billion people in late 2005, with
penetration ratios rising to around 60% in the developed world,
according to Mary Meeker. Never before has a major technology reached so many in such a short period of time. Students of technology will tell you that’s the norm — that each succeeding wave of technological transformation is accompanied by increasingly rapid rates of dissemination. That was true of railroads, motor vehicles, air conditioning, radio, and TV. The Internet follows that pattern but with an important twist —
it rewrites the rules of cross-border connectivity between developing
and developed countries and it takes that connectivity very quickly
into the once sacrosanct realm of services. For
those reasons, alone, the potential macro impacts of the interplay
between globalization and the Internet cannot be minimized.