Summary: Opening Scene: The World Is Ten Years Old.
“ The trouble spread to one continent after another like a virus.” USA Today
On December 8, 1997, the government of Thailand shut down 56 of their countries finance houses. These finance houses borrowed heavily in U.S. dollars and lent those dollars out to Thai businesses for the building of hotels, office blocks, luxury apartments and factories. Almost overnight, these private banks had been bankrupted by the crash of the Thai currency, the baht. This situation caused a domino effect on other leading businesses that caused money problems. Many businesses couldn’t pay the finance houses back, many finance houses couldn’t repay their foreign leaders and the whole system went into gridlock putting 20,000 white-collar employees out of work. The Thai crisis triggered a general flight of capital out of practically all the Southeast Asian emerging markets, driving down the value of currencies in South Korea, Malaysia and Indonesia. Southeast Asian slowdown began to have an important effect on commodity prices around the world, including Russia. Too many of Russia’s factories couldn’t make anything of value. Without much of a growing economy, the Russian government became dependent on taxes from crude oil and other commodity exports to fund its operating budget. The hedge funds – the huge unregulated pools of private capital that search the globe for the best investments – were the transmission device from Russia to all the other arising markets in the world, particularly Brazil. The declines in Brazil and the other emerging markets became the delivery that triggered a herdlike stampede into U.S. Treasury bonds. The abrupt drop in the yield on U.S. Treasury bonds was then the transferal device, which twisted more hedge funds and investment banks. In order to make money in such a profoundly competitive world the hedge funds had to look for more exotic bets with larger pools of cash. The cold war system that had dominated international affairs since 1945 had been replaced by a new interconnected system called globalization. World War 1, the Russian Revolution and the Great Depression broke the first era of globalization and global finance capitalism apart. The Cold War was also an international system and it lasted from 1945 to 1989, when the Berlin Wall fell. It was replaced by another system: the new era of globalization we are now in. What is new today is the degree and intensity with which the world is being linked into a single globalized marketplace. The new era of globalization, compared to the one before World War 1, is turbocharged. It is built around falling telecommunications costs- thanks to microchips and the Internet. People can now offer and trade services globally, from giving advice to software writing to data processing. This era of globalization is unique not only because these technologies are making it possible for corporations to reach farther, faster, cheaper and deeper around the world, but because it is allowing individuals to do so. To understand the post-Cold War world, you have to start by understanding that a new international system has succeeded it- globalization.
Summary # 2 – Tourist with an Attitude
In the very beginning the author says that life is like room service – you never know what you’re going to find outside your door. When he went to a hotel in Tokyo, he ordered four oranges and each time he got something different, such as orange juice and peeled oranges. Another time at the Metropole Hotel in Vietnam he ordered tangerines and the waiter said there were none left. The waiter then asked if he wanted watermelon and he said yes, and instead of watermelon he brought four tangerines. He is the foreign affairs columnist for The New York Times and he describes it as the best job because he gets to be a tourist with an...