It may be we are past the Lessons To Learn stage in this financial crisis, but some, like a few of those very smart people who maintain jobs in finance, claim the new guru for our time—with all due respect to Professor Roubini—is Richard Koo, Chief Economist for Nomura and a former economist for the Federal Reserve Bank of New York.
Koo’s bio does not tell us much about his personal preferences but his book, The Holy Grail of Macroeconomics: Lessons from Japan’s Great Recession, has unique value now as we reflect on the fact that it took Japan ten years–their “lost decade”–or even, as Koo frames it in his introduction, fifteen years, to recover from their gruesome economic meltdown. Copies of the book have been passed like samizdat between private equity and hedge fund partners, and even a few Wall Streeters presented first editions as Valentines. Amazon’s Look Inside option shows the book’s Table of Contents, and one can understand why “Characteristics of Balance Sheet Recessions” was not such a sexy summer read. It sure is sexy now.