The Only Game In Town summary

Central banks managed to restore calm to financial markets after the 2008 crisis, but they failed to create what Western countries need the most: strong growth.

All in all, the central banks’ new ventures have created ten major worrisome developments. Let’s take a look at the first two now.

In recent decades, globalization has been closing the worldwide gap between rich and poor countries. Yet within each country, income inequality is increasing.

In fact, income inequality is now higher than at any point in the past fifty years. The average income of the top 10 percent of the Western world is about nine times higher than that of the lowest 10 percent, according to the Organization for Economic Co-operation and Development, or the OECD.

We’ve seen that domestic nationalist political movements are on the rise. Unfortunately, this isn’t the only increasing global concern.

Geopolitical tensions are also on the rise because Western economies can no longer manage the international monetary system. The Western countries are the heart of the current global financial system. The United States is the most influential player in both of the world’s two most powerful financial institutions, the International Monetary Fund, or the IMF, and the World Bank.

If you’re the head of your company, you take a risk when you invest in training your labor force. You can’t be sure it will eventually pay off. If you’re an investor, you take a financial risk with your investment: you can’t know whether the share price will rise or fall.

In other words, companies take economic risks and investors take financial risks.

It would be nice if there were one simple solution for all the global economic problems of our time. Alas, there is not. But there are four key measures we can take to help regenerate growth.

First off, we need to take the idea of inclusive growth – growth that benefits everyone – more seriously. Central banks have proven to be ineffective at fostering inclusive growth with their financial engineering. Instead, we have to focus on structural reforms, like strengthening infrastructure and improving education systems.

Where is the current economic course leading us? It’s impossible to predict the future, but we do know a few things.

In the future, countries will likely be divided into four groups: those that prosper, those that are slowly growing, those that stagnate and those with a volatile future.