If you care about the American economy,
you need to read The Shadow Market
If you care about American political power around the globe,
you need to read this book.
If you want to make money in the global financial markets,
you really need to read this book.
"Dense and disturbing...Weiner succeeds in making
the case that something fundamental has changed
in the world."
— The New York Times Book Review
Eric J. Weiner has covered business and economics for more than fifteen years. His first book, What Goes Up: The Uncensored History of Modern Wall Street as Told by the Bankers, Brokers, CEOs, and Scoundrels Who Made It Happen, was named one of the best books of 2005 by Barron's magazine and one of "The Year's Most Enriching Reads" by Kiplinger's. A former columnist and reporter for Dow Jones Newswires, he has written for The Wall Street Journal, Los Angeles Times, The Boston Globe, and numerous other major publications. He lives in Great Barrington, Massachusetts, with his wife, Paige, and their son, Jake.
Book Excerpt
The Future Happened Yesterday
Do you ever get the feeling that something's going on in the global economy that we don't fully understand? That while Americans have been focused on fixing our wounded economy and worrying about our lost jobs and battered bank accounts, the world around us was changing in important but nearly imperceptible ways? You'd be right. It did. Enormous economic changes are taking place around the globe, many of them hidden in plain sight, others just plain hidden—kept from the press, the government, and, most of all, the everyday investor. Ever since 2008, when the global financial system melted down, the economic world as we know it has been flipped on its head. Countries and corporations that once dominated the planet have been decimated. Meanwhile, other powers have risen in their place and asserted themselves globally. And although the American economy appears to be recovering somewhat, and a handful of us are beginning to feel more confident about the future, the truth is that we won't be returning to "normal" any time soon.
The structural changes in the global economy have created both dangers and opportunities. If we ignore them, we may suffer mightily—as citizens, as workers, and as investors. Our children may suffer even more. The march of economic history, let it be recalled, is indifferent to your plight or mine. It doesn't care whether the United States becomes, in a few decades, a weakened, second-tier economy riddled with debt and unemployment, and beholden to other countries and a new global currency that is not the U.S. dollar. That could happen, too. However, if we take the trouble to understand the changes now occurring, we might be able to make them work to our advantage. We might be able to get out in front of future economic waves. A few of us may even get wealthier as a result.
In stark terms, here is what has happened: While our economy tanked, nations like China and the small oil-rich states of the Persian Gulf, which still had plenty of wealth on hand, suddenly discovered that they were really rich compared to the rest of the world. So they started using their cash to seize geopolitical power. Wealth and influence crept to the East. Meanwhile, America literally didn't have the money to save itself and the rest of the world from the financial contagion it started. Our banks and investment institutions flat-out didn't have the capital to rescue the financial system themselves. By late 2008, the Bush administration was desperately trying to stave off an economic panic. That fall, you may remember, as the stock market reeled and America's largest banks stared at insolvency, the U.S. Treasury Department sent envoys to China, Singapore, Abu Dhabi, Kuwait, and Saudi Arabia looking for investments of hundreds of billions of dollars. But Bush's envoys were completely rebuffed. The problem was that each of these countries already had been burned by the earlier failures of major U.S. investment banks like Lehman Brothers and Bear Stearns; they had little appetite for taking on more American risk. So America plunged into financial chaos as the government was forced to launch massive bailouts and stimulus programs that will saddle us with financial obligations for decades to come.
The Pentagon has run elaborate simulations of global financial war. Result: America lost, and the shadow market won.