Crisis Snobs

"I am struck by how little interest is shown in the lessons learned from the numerous financial system crashes that have occurred in developing countries over the past two decades," says Bill Easterly of NYU fame. "I guess American policy makers and analysts are 'crisis snobs' that don't think they can learn from Argentina (even Japan and Sweden seem to be a stretch.)"

Think of these who have encyclopaedic knowledge of these crises, like Ross Levine at Brown and Jerry Caprio at Williams. It's all in their book (joint with James Barth) - Rethinking Bank Regulation: Till Angels Govern. Treasury people across OECD countries have a lot to learn from them. (Jerry was my director for a couple of years and I can tell you he knows this stuff inside and out.)

This knowledge matters not just for central bankers and Treasury officials. Coffee bean growers in Indonesia reported this week that their prices have fallen by 40 percent since August. Why? If anything, there must be more coffee-drinking at financial institutions and their supervisors around the world. No. It's because shippers cannot get trade credit. And without shipping, coffee beans don't get to your Starbucks.