Money Machine

Chapter 22Stars Align

Christmas 2008 brought little holiday cheer to the world. Too many people—investors, consumers, employees, and their families—had been punished by the crushing waves of the global economic crisis. A number of major financial institutions in the United States and Europe had failed. Personal bankruptcies soared, as did unemployment rates. Western banks were still in serious trouble, despite the unprecedented bailouts and infusions of capital by the U.S. and European governments, which were doling out what soon amounted to trillions of dollars.

Away from the epicenter, Asia continued to weather things a little better. China registered an economic growth rate of 9% for 2008—impressive for sure, although it was the country's lowest figure in seven years and the annualized rate for the fourth quarter was only 6.8%. By its own standard, China was in its worst economic slowdown in a decade. The Chinese stock markets were trading in bear territory. Nobody knew how bad things could get, how and when the crisis would end, and how much more damage might be done before then. Investors and policymakers alike were trying to sort out what had gone wrong, and what could be done to pull economies out from the malaise.

Over the holidays I traveled to Whistler, the ski resort in western Canada, with my daughter LeeAnn for a much‐needed vacation. I did my best to escape a bit, although I will confess that there were moments when I was checking my phone from the chairlifts. ...