With the deepening economic crisis there have been repeated calls for an early warning system of the world economy. Little has been said, how such a system should be built.
To build a global early warning system we have to overcome the predicament that Alan Greenspan highlighted: ‘How do we know when international exuberance has unduly escalated asset values?….We should not underestimate or become complacent about the complexity of the interactions of asset markets and the economy…
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