We’ve now seen the worst crisis and the deepest recession since the 1930s, and unprecedented
government firepower unleashed in response. It’s been a Galapagos Islands of economic exotica:
central banks out of interest-rate bullets reaching for their monetary bayonets, debt crises stalking rich
and poor countries, fear of inflation side by side with fear of deflation. The smiles have been wiped
off the experts’ faces. The public’s indifference to the economy has been replaced by rapt attention
and, let’s face it, a lot of fear.
With such a turbulent and uneasy global economy, clear explanations of what’s going on are vital.
Yet, most people find economics shrouded in jargon and dry numbers. The Little Book of Economics
provides the solution.
Telling the story of our economy has been my stock in trade for 20 years now. At newspapers in
Canada, then at the Wall Street Journal, and now The Economist, I’ve followed markets, talked to
workers, visited businesses, and got to know central bankers. Then I’ve explained to readers and
listeners in plain, simple terms, what’s going on in the economy, why, and how it affects them.
I was introduced to economics as a child. My mother, a practicing economist, now retired,
delighted in trying to apply what she knew about the dismal science to her four children’s upbringing.
We must have been the only kids in town whose weekly allowance was indexed to inflation. I took
economics in college, though not intending to write about it; I just wanted a fallback in case
journalism didn’t work out. Right out of college, I joined a metropolitan daily newspaper that put me
on the night shift covering local politics, crime, and the like, a lot of which never made it into the
paper. The business section, however, had lots of space in it and regular hours, so I got a transfer.
Soon, I was writing about the economy and the markets, and loving it.
In the process, I discovered a chasm between the economics taught in college and the real world.
Textbooks go on about the money supply but it turns out central banks ignore it. Simple questions like
“how big is the national debt?” have complicated answers. I learned about fiscal policy but not about
debt crises.
