Recent financial crises in Mexico and Europe should not deter the United States from exploring the potential benefits of an internationalized economy, said leading American executives who appeared at a panel discussion during the June 3 conference at Boston College.
Fortune magazine columnist and CBS radio host Marshall Loeb led the discussion, titled
"The Stability of Global Financial Markets.
Loeb reviewed events of the past few years, such as a fall in the American dollar and the European stock market crash, which at the time appeared to signal a more pervasive world-wide economic crisis. Although
"the sky has not fallen,
" Loeb said these events raise the question of whether the US is more financially vulnerable through its participation in a global economy.
"Are we, perhaps, losing control of our own destiny?
" he said.
Fortune magazine columnist and CBS radio host Marshall Loeb introduces the panel discussion on "The Stability of Global Financial Markets."
Panelists said the global economy holds risks for those who take part in it, but also offers opportunities for growth, and the infusion of new ideas and methods to improve standards of living.
Robert Pozen, managing director, senior vice president and general counsel of FMR Corp., said foreign economic activity in the US has helped ease the country's budget deficit, for example, while Bank of Boston Vice Chairman and Chief Financial Officer William Shea noted Argentina's privatization of its social sec urity system as an example of the innovation often sparked by entry into the world marketplace.
Part of the reason for the economic volatility, panelists pointed out, is the dramatic transition among many regions and countries to different forms of government, and by extension, new ways of running their economies.
"We are dealing with a whole new instrument, a new relationship between financial institutions and the world,
" Securities and Exchange Commission Chairman Arthur Levitt Jr. said.
"We have not worked out all the aspects of the potential systemic problems wh ich go along with this.
Loeb invited panel members to describe their experiences in emerging markets such as India, Brazil and Mexico, and the unique characteristics in those countries and regions which might affect the global market.
Toward the end of the session, panelists listed some critical factors which could determine American prospects for growth in the global economy. Among other comments, Bear Stearns & Co. Senior Managing Director and Chief Economist Wayne Angell said price s tability should be a priority, while American Stock Exchange Chairman and CEO Richard Syron said the US must pay more attention to increasing productivity and reducing consumption.
Loeb, concluding the discussion, s aid it is important for those supporting America's role in the global market to decry protectionism. He also remarked on the
" of computer and information technology in educating Americans for the world economy, and said such technology should be readily available to all children.
Other panelists included E.M. Warburg Pincus & Co. Managing Director W. Bowman Cutter, a former White House National Economic Council deputy director; and D.E. Shaw & Co. Chairman David E. Shaw.
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