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Jewish settlements on occupied territory are considered illegal under international law, though Israel disputes this. Neither Israel nor Partner commented on the FIDH report.

At a conference in Cairo on Wednesday, Mr Richard said: "I am ready to abandon this [partnership] tomorrow morning but the point is that I want to secure the legal risk for the company.

"We want to be one of the trustful partners of all Arab countries."

"Simultaneously, I call on our friends to say in a clear and loud voice that they object to any kind of boycott against the Jewish state."

Over the holidays last year, according to the research firm Strategy Analytics, Apple vacuumed up nearly 90 percent of the profits in the smartphone business.

How will the search company — or anyone else, for that matter — ever make much money from Android?

Google is sanguine about Android’s prospects and said the company’s original vision for Android was never solely about huge profits. “The bet that Larry, Sergey and Eric made at the time was that smartphones are going to be a thing, there’s going to be Internet on it, so let’s make sure there’s a great smartphone platform out there that people can use to, among other things, access Google services

The fact that Google does not charge for Android, and that few phone manufacturers are extracting much of a profit from Android devices, means that much of the globe now enjoys decent smartphones and online services for low prices

at the same time, given the increasing threats to Google’s advertising business, we might also wonder how long that largess can continue.

A brighter spot for Google is the revenue it collects from sales via Android’s app store, called Google Play. For years, Android apps were a backwater, but sales have picked up lately. In 2014, Google Play sold about $10 billion in apps, of which Google kept about $3 billion (the rest was paid out to developers). Apple makes more from its App Store. Sales there exceeded $14 billion in 2014, and rising iPhone sales in China have led to a growing app haul for Apple. Still, Google’s app revenue is becoming an increasingly meaningful piece of its overall business, and it is also growing rapidly.

even if hot Silicon Valley start-ups still create apps for iOS first, app makers in other parts of the world see Android as a surer path to the masses. “The reality is that folks like you should play a role in educating the Silicon Valley,” she said.

Google’s strategy of giving Android to phone makers free has led to a surge of new entrants in the phone business, several of which sell high-quality phones for cut-rate prices. Among those is Xiaomi, a Chinese start-up making phones that have become some of the most popular devices in China.

Because Xiaomi and others don’t make much of a profit by selling phones, they’re all looking for other ways to make money — and for many, the obvious business is in apps offering mail, messaging and other services that compete with Google’s own moneymaking apps.

The situation is especially painful for Google in China, the world’s fastest-growing smartphone market, where Google’s apps are blocked. Even in the rest of Asia, where many low-cost phone manufacturers do include Google’s apps on their phones, there’s growing interest in finding some alternative to Google’s version of Android. About 30 percent of Android smartphones shipped in the last quarter of 2014 were actually modified, or forked, versions of the OS that may not be very hospitable to Google’s services, according to the firm ABI Research

Cyanogen, has raised about $100 million from several investors — and has signed a “strategic partnership” with Google’s arch-competitor Microsoft — to sell phone makers an alternative user interface that works on top of Google’s Android.

“We share services revenue with the phone makers — and today they get very little of that from Google,” said Kirt McMaster, Cyanogen’s chief executive. “There are very few companies in the world today that really like Google. Nobody wants Google to run the table with this game. So it’s a good time to be a neutral third party. We’re Switzerland, and we want to share that revenue with our ecosystem partners in a meaningful way.”

in the long run, the rise of Android switching sets up a terrible path for Google — losing the high-end of the smartphone market to the iPhone, while the low end is under greater threat from noncooperative Android players like Xiaomi and Cyanogen.

Congress and the White House seem paralyzed in deciding the future of taxes and spending. Where are we going in these areas? Investors and companies who have to make hiring decisions have no clue. “The economy is paying a high uncertainty premium right now,” says Mohamed El-Erian, the C.E.O. of the world’s largest bond fund, Pimco. “With such uncertainty, people delay as many decisions as possible.”

Sailors balanced out the weight by leaving behind their ships' ballast: stones, gravel and soil. They swapped English dirt for Virginia tobacco. That dirt very likely contained the common nightcrawler and the red marsh worm. So, almost certainly, did the rootballs of plants that the colonists imported.

In worm-free woodlands, leaves pile up in drifts on the forest floor. Trees and shrubs in wormless places depend on litter for food. When earthworms arrive, they quickly consume the leaf litter, packing the nutrients deep in the soil in the form of castings (worm excrement). Suddenly, the plants can no longer feed themselves; their fine, surface-level root systems are in the wrong place. Wild sarsaparilla, wild oats, Solomon's seal and a host of understory plants die off; grass-like species such as Pennsylvania sedge take over. Sugar maples almost stop growing, and ash seedlings start to thrive.

Transported in the bodies of sailors, malaria may have crossed the ocean as early as Columbus's second voyage. Yellow fever, malaria's frequent companion, soon followed. By the 17th century, the zone where these diseases held sway—coastal areas roughly from Washington, D.C., to the Brazil-Ecuador border—was dangerous territory for European migrants, many of whom died within months of arrival

Initially, American planters preferred to pay to import European laborers—they spoke the same language and knew European farming methods. They also cost less than slaves bought from Africa, but they were far less hardy and thus a riskier investment. In purely economic terms, the historian Philip Curtin has calculated, the diseases of the Columbian Exchange made the enslaved worker "preferable at anything up to three times the price of the European."

At the time, England and Scotland shared a monarch but remained separate nations. England, the bigger partner, had been pushing a complete merger for decades. Scots had resisted, fearing a London-dominated economy, but now England promised to reimburse investors in the failed Panama project as part of a union agreement. As Mr. McNeill wrote, "Thus Great Britain was born, with assistance from the fevers of Panama."

Eighteenth-century farmers who planted potatoes reaped about four times as much dry food matter as they did from wheat or barley. Hunger was then a familiar presence in Europe. France had 40 nationwide food calamities between 1500 and 1800, more than one every decade, according to the French historian Fernand Braudel. England had still more. The continent simply could not sustain itself. The potato allowed most of Europe—a 2,000-mile band between Ireland and the Ukraine—to feed itself. (Corn, another American crop, played a similar role in Italy and Romania.) Political stability, higher incomes and a population boom were the result. Imported from Peru, the potato became the fuel for the rise of Europe.

The sweet potato played a similar role in China. Introduced (along with corn) from South America via the Pacific silver trade in the 1590s, it suddenly provided a way for Chinese farmers to cultivate upland areas that had been unusable for rice paddies. The nutritious new crop encouraged the fertility boom of the Qing dynasty, but the experiment soon went badly wrong. Because Chinese farmers had never cultivated their dry uplands, they made beginners' mistakes. An increase in erosion led to extraordinary levels of flooding, which in turn fed popular unrest and destabilized the government. The new crops that had helped to strengthen Europe were a key factor in weakening China.

European ships accidentally imported the fungus-like organism, native to Peru, that causes the potato disease known as late blight. First appearing in Flanders in June 1845, it was carried by winds to potato farms around Paris in August. Weeks later it wiped out fields in the Netherlands, Germany, Denmark and England. Blight appeared in Ireland on Sept. 13.

the Columbian Exchange, like a biological Internet, has put every part of the natural world in contact with every other, refashioning it, for better or worse, at a staggering rate.

most economists see global trade as a win-win proposition, but resource limitation turns it into a win-lose, zero-sum contest. “The faster China grows, the higher grain prices go, the more people in China or India who upgrade to meat, the higher the tendency for Africa to starve,” he said.

Grantham argues that the late-18th-century doomsayer Thomas Malthus pretty much got it right but just had the bad timing to make his predictions about unsustainable population growth on the eve of the hydrocarbon-fueled Industrial Revolution, which “partially removed the barriers to rapid population growth, wealth and scientific progress.” That put off the inevitable for a couple of centuries, but now, ready or not, the age of cheap hydrocarbons is ending. Grantham’s July letter concludes: “We humans have the brains and the means to reach real planetary sustainability. The problem is with us and our focus on short-term growth and profits, which is likely to cause suffering on a vast scale. With foresight and thoughtful planning, this suffering is completely avoidable.”

Grantham, the public face of a company that manages more than $100 billion in assets, the very embodiment of a high-finance insider in blue blazer and yellow tie, has serious doubts about capitalism’s ability to address the biggest problems facing humanity.

When he reminds us that modern capitalism isn’t equipped to handle long-range problems or tragedies of the commons (situations like overfishing or global warming, in which acting rationally in your own self-interest only deepens the harm to all), when he urges us to outgrow our touching faith in the efficiency of markets and boundless human ingenuity, and especially when he says that a wise investor can prosper in the coming hard times, his bad news and its silver lining come with a built-in answer to the skeptical question that Americans traditionally pose to egghead Cassandras: If you’re so smart, how come you’re not rich?

Grantham believes that the best approach may be to recast global warming, which depresses crop yields and worsens soil erosion, as a factor contributing to resource depletion. “People are naturally much more responsive to finite resources than they are to climate change,” he said. “Global warming is bad news. Finite resources is investment advice.”

“Americans are just about the worst at dealing with long-term problems, down there with Uzbekistan,” he said, “but they respond to a market signal better than almost anyone. They roll the dice bigger and quicker than most.”

“E.D.F. is educating people that dealing with climate change will be good for the economy and job creation. One of Jeremy’s insights is that we can make headway on the market side because higher commodity prices will enforce greater efficiency.”

Grantham says that corporations respond well to this message because they are “persuaded by data,” but American public opinion is harder to move, and contemporary American political culture is practically dataproof. “The politicians are the worst,” he said. “An Indian economist once said to me, ‘We have 28 political parties, and they all think climate change is important.’ ” Whatever the precise number of parties in India, and it depends on how you count, his point was that the U.S. has just two that matter, one that dismisses global warming as a hoax and one that now avoids the subject.

Grantham, who says that “this time it’s different are the four most dangerous words in the English language,” has become a connoisseur of bubbles. His historical study of more than 300 of them shows the same pattern occurring again and again. A bump in sales or some other impressive development causes people to get excited. When they do, the price of that asset class — South Sea company shares, dot-coms — goes up, and human nature and the financial industry conspire to push it higher. People want to hear good news; they tend to be bad with numbers and uncertainty, and to assume that present conditions will persist. In the financial industry, the imperative to minimize career risk produces herd behavior.

So it’s news when Grantham, who has built his career on the conviction that peaks and troughs will even out as prices inevitably revert to their historical mean, says that this time it really is different, and not in a good way. In his April letter, “Time to Wake Up: Days of Abundant Resources and Falling Prices Are Over Forever,” he argued that “we are in the midst of one of the giant inflection points in economic history.” The market is “sending us the Mother of all price signals,” warning us that “if we maintain our desperate focus on growth, we will run out of everything and crash.”

here’s the short version: “The prices of all important commodities except oil declined for 100 years until 2002, by an average of 70 percent. From 2002 until now, this entire decline was erased by a bigger price surge than occurred during World War II. Statistically, most commodities are now so far away from their former downward trend that it makes it very probable that the old trend has changed — that there is in fact a Paradigm Shift — perhaps the most important economic event since the Industrial Revolution.”

When prices go up and stay up, it’s not a bubble. Prices may always revert to the mean, but the mean can change; that’s a paradigm shift. As Grantham tells it, oil went first. For a century it steadily returned to about $16 a barrel in today’s currency, then in 1974 the mean shifted to about $35, and Grantham believes it has recently doubled again. Metals and nearly everything else — coal, corn, palm oil, soybeans, sugar, cotton — appear to be following suit. “From now on, price pressure and shortages of resources will be a permanent feature of our lives,” he argues. “The world is using up its natural resources at an alarming rate, and this has caused a permanent shift in their value. We all need to adjust our behavior to this new environment. It would help if we did it quickly.”

Grantham is taking the Malthusian side in an ongoing debate about growth and commodity prices­. The argument often circles back to the bet made in 1980 between the biologist Paul Ehrlich, who foretold catastrophic scarcity caused by overpopulation, and the economist Julian Simon, who argued that any short-term increase in resource prices caused by population growth will stimulate inventors and entrepreneurs to find new ways to exploit those resources, lowering prices in the long run. The two men picked five commodities and wagered on whether their prices, taken as an indicator of scarcity, would be higher or lower in 1990. Simon won, 5-0, even though the world’s population grew by 800 million during that decade. Malthusians have been trying to live down that defeat ever since, but, as Grantham points out in his July letter, if we extend the original bet past its arbitrary 10-year limit to the present day, Ehrlich wins the five-commodity bet 4-1, and he wins big if the bet is further extended to all important commodities.

He’s an impassioned environmentalist not only for the usual reasons but also because he believes humanity’s vexed relationship with the planet is the great economic story of our time. “This commodities thing may turn out to be the most interesting call of my career,” he told me. “I have no doubt we’re going to have a bad hundred years. We have the resources to gracefully handle the transition, but we won’t. We apparently can’t.”

“Whether the stable population will be 1.5 billion or 5 billion,” he said to me, “the question is: How do we get there?”

the Ryan plan worsens our trillion-dollar structural deficit and the Obama plan amounts to small potatoes, at best. Worse, we are about to descend into class war because the Obama plan picks on the rich when it should be pushing tax increases for all, while the Ryan plan attacks the poor when it should be addressing middle-class entitlements and defense.

President Daniel Ortega had said Nicaragua planned to begin construction in May 2014.

He told La Prensa newspaper in Nicaragua that only when the feasibility studies were concluded would it be possible to choose a "definite route".

Several routes were proposed, all of them about three times longer than the Panama Canal, which took 10 years to build and was finished in 1914.

The waterway connects the Caribbean with the Pacific via Lake Nicaragua or Cocibolca, Central America's largest freshwater lake. Its length is estimated at just under 300km (190 miles).

The Nicaraguan government will get a minority share of the profits generated by the canal.

But HKND's owner, Wang Jing, said he had attracted global investors and it was ready to build the canal in less than six years.

Nicaraguan leaders have dreamt of building the canal for over a century.

Nicaragua's announcement comes after a European-led consortium expanding the Panama Canal threatened to halt work unless the Panama Canal Authority met more than $1.6bn (£1bn) in cost overruns.

Over time, the same network efficiencies that had given them their great advantages would become the instrument of their failures.

In the financial services industry, it led to the financial crisis

In the case of Wal-Mart, its adoption of technology to manage its supply chain at first reaped great benefits, but over time it cost competitors and suppliers hundreds of thousands of jobs, thus “gradually impoverishing its own customer base,”

The N.S.A.? It developed computer technology that could monitor the entire world — and, in the process, lost control of the contractors it employed.

“Networks need a great number of people to participate in them to generate significant value. But when they have them, only a small number of people get paid. This has the net effect of centralizing wealth and limiting overall economic growth.” Thus, in Lanier’s view, is income inequality also partly a consequence of the digital economy.

His great example here is Kodak and Instagram. At its height, writes Lanier “Kodak employed more than 140,000 people.” Yes, Kodak made plenty of mistakes, but look at what is replacing it: “When Instagram was sold to Facebook for a billion dollars in 2012, it employed only 13 people.”

the value of these new companies comes from us. “Instagram isn’t worth a billion dollars just because those 13 employees are extraordinary,” he writes. “Instead, its value comes from the millions of users who contribute to the network without being paid for it.”

There are two additional components to Lanier’s thesis. The first is that the digital economy has done as much as any single thing to hollow out the middle class

It is Lanier’s radical idea that people should get paid whenever their information is used. He envisions a different kind of digital economy, in which creators of content — whether a blog post or a Facebook photograph — would receive micropayments whenever that content was used

A digital economy that appears to give things away for free — in return for being able to invade the privacy of its customers for commercial gain — isn’t free at all, he argues.

Lanier wants to create a dynamic where digital networks expand the pie rather than shrink it, and rebuild the middle class instead of destroying it.

The market, i.e., globalization, is tying economies more tightly together than ever before, making our workers, investors and markets much more interdependent and exposed to global trends, without walls to protect them.

the rapid growth of carbon in our atmosphere and environmental degradation and deforestation because of population growth on earth — the only home we have — are destabilizing Mother Nature’s ecosystems faster.

n sum, we’re in the middle of three “climate changes” at once: one digital, one ecological, one geo-economical. That’s why strong states are being stressed, weak ones are blowing up and Americans are feeling anxious that no one has a quick fix to ease their anxiety. And they’re right.

The only fix involves big, hard things that can only be built together over time: resilient infrastructure, affordable health care, more start-ups and lifelong learning opportunities for new jobs, immigration policies that attract talent, sustainable environments, manageable debt and governing institutions adapted to the new speed.

we’re not going to respond to the big global issues until they hit the economy. It’s hard to imagine a stronger example than a city of 20 million people running out of water. Yet despite the clear threat, the main response is ‘we hope it rains.’ Why such denial? Because the implications of acceptance are so significant, and we know in our hearts there’s no going back once you end denial. It would demand that the country face up to the urgency of reversing rather than slowing deforestation” and “the need to prepare the country for the risks that a changing climate presents.”

Chile’s effort, started as a pilot program in 2010, has attracted nearly 2,000 entrepreneurs, whose businesses have raised more than $100 million in financing.

Mr. Wadhwa described Chile’s initiative as the world’s most aggressive effort to lure entrepreneurs and said it was putting Chile on the map as a destination for start-ups.

A sweetener that the Spanish government should highlight, he said, is its unsecured lending program, which has about €100 million, or $125 million, to lend to innovative small and midsize companies annually. The loans, from €25,000 to €1.5 million, are available to all entrepreneurs, regardless of nationality, who have a business based in Spain

Last year, it made more than 600 unsecured loans to entrepreneurs, with an average amount of about €131,000.

Harvard historian Sven Beckert makes the case that in the 19th century what most stirred the universe was cotton.

Today some 350 million people are involved in growing, transporting, weaving, stitching or otherwise processing the fibers of this plant.

the slave plantations that spread across the American South, a form of outsourcing before the word was invented. These showed that cotton could be lucratively cultivated in bulk for consumers as far afield as another continent, and that realization turned the world upside down. Without slavery, he says, there would have been no Industrial Revolution.

Beckert’s most significant contribution is to show how every stage of the industrialization of cotton rested on violence.

As soon as the profit potential of those Southern cotton fields became clear in the late 1780s, the transport of slaves across the Atlantic rapidly increased. Cotton cloth itself had become the most important merchandise European traders used to buy slaves in Africa.

Then planters discovered that climate and rainfall made the Deep South better cotton territory than the border states. Nearly a million American slaves were forcibly moved to Georgia, Mississippi and elsewhere, shattering many families in the process.

The search for more good cotton-­growing soil in areas that today are such states as Texas, Arkansas, Kansas and Oklahoma was a powerful incentive to force Native Americans off their traditional lands and onto reservations, another form of violence by the “military-cotton complex.”

by 1850, two-thirds of American cotton was grown on land that had been taken over by the United States since the beginning of the century.

Beckert practices what is known as global or world history: the study of events not limited to one country or continent.

another major theme of “Empire of Cotton” is that, contrary to the myth of untrammeled free enterprise, this expanding industry was fueled at every stage by government intervention.

it was not just in the United States that planters’ thirst to sow large tracts with cotton pushed indigenous peoples and self-sufficient farmers off their land; colonial armies did the same thing in India, West Africa and elsewhere

it was not only white Southerners who were responsible for the harsh regime of slave-grown cotton: merchants and bankers in the North and in Britain lent them money and were investors as well.

From Denmark to Mexico to Russia, states lent large sums to early clothing manufacturers. Whether it was canals and railways in Europe or levees on the Mississippi, governments jumped in to build or finance the infrastructure that big cotton growers and mills demanded

Britain forced Egypt and other territories to lower or eliminate their import duties on British cotton.

he wants to use that commodity as a lens on the development of the modern world itself. This he divides into two overlapping phases: “war capitalism” for the stage when slavery and colonial conquest prepared the ground for the cotton industry, and “industrial capitalism” for the period when states intervened to protect and help the business in other ways

Today, a “giant race to the bottom” by an industry always looking for cheaper labor has shifted most cotton growing and the work of turning it into clothing back to Asia

violence in different forms is still all too present. In Uzbekistan, up to two million children under 15 are put to work harvesting cotton each year

In China, the Communist Party’s suppression of free trade unions keeps cotton workers’ wages down, just as British law in the early 1800s saw to it that men and women who abandoned their ill-paid jobs and ran away could be jailed for breach of contract.

in Bangladesh, the more than 1,100 people killed in the notorious collapse of the Rana Plaza building in 2013 were mostly female clothing workers, whose employers were as careless about their safety as those who enforced 14- or 16-hour workdays in German and Spanish weaving mills a century before

what about the United States? Before the 1914 war, the great economic potential of the U.S. was suppressed by its ineffective political system, dysfunctional financial system, and uniquely violent racial and labor conflicts. “America was a byword for urban graft, mismanagement and greed-fuelled politics, as much as for growth, production, and profit,”

as World War I entered its third year—and the first year of Tooze’s story—the balance of power was visibly tilting from Europe to America. The belligerents could no longer sustain the costs of offensive war. Cut off from world trade, Germany hunkered into a defensive siege, concentrating its attacks on weak enemies like Romania. The Western allies, and especially Britain, outfitted their forces by placing larger and larger war orders with the United States

His Wilson is no dreamy idealist. The president’s animating idea was an American exceptionalism of a now-familiar but then-startling kind.

That staggering quantity of Allied purchases called forth something like a war mobilization in the United States. American factories switched from civilian to military production; American farmers planted food and fiber to feed and clothe the combatants of Europe

But unlike in 1940-41, the decision to commit so much to one side’s victory in a European war was not a political decision by the U.S. government. Quite the contrary: President Wilson wished to stay out of the war entirely. He famously preferred a “peace without victory.” The trouble was that by 1916, the U.S. commitment to Britain and France had grown—to borrow a phrase from the future—too big to fail.

His Republican opponents—men like Theodore Roosevelt, Henry Cabot Lodge, and Elihu Root—wished to see America take its place among the powers of the earth. They wanted a navy, an army, a central bank, and all the other instrumentalities of power possessed by Britain, France, and Germany. These political rivals are commonly derided as “isolationists” because they mistrusted the Wilson’s League of Nations project. That’s a big mistake. They doubted the League because they feared it would encroach on American sovereignty.

Grant presents this story as a laissez-faire triumph. Wartime inflation was halted. Borrowing and spending gave way to saving and investing. Recovery then occurred naturally, without any need for government stimulus. “The hero of my narrative is the price mechanism, Adam Smith’s invisible hand,

It was Wilson who wished to remain aloof from the Entente, who feared that too close an association with Britain and France would limit American options.

Wilson was guided by a different vision: Rather than join the struggle of imperial rivalries, the United States could use its emerging power to suppress those rivalries altogether. Wilson was the first American statesman to perceive that the United States had grown, in Tooze’s words, into “a power unlike any other. It had emerged, quite suddenly, as a novel kind of ‘super-state,’ exercising a veto over the financial and security concerns of the other major states of the world.”

Wilson hoped to deploy this emerging super-power to enforce an enduring peace. His own mistakes and those of his successors doomed the project,

What went wrong? “When all is said and done,” Tooze writes, “the answer must be sought in the failure of the United States to cooperate with the efforts of the French, British, Germans and the Japanese [leaders of the early 1920s] to stabilize a viable world economy and to establish new institutions of collective security. … Given the violence they had already experienced and the risk of even greater future devastation, France, Germany, Japan, and Britain could all see this. But what was no less obvious was that only the US could anchor such a new order.”

And that was what Americans of the 1920s and 1930s declined to do—because doing so implied too much change at home for them: “At the hub of the rapidly evolving, American-centered world system there was a polity wedded to a conservative vision of its own future.”

The Forgotten Depression is a polemic embedded within a narrative, an argument against the Obama stimulus joined to an account of the depression of 1920-21. As Grant correctly observes, that depression was one of the sharpest and most painful in American history.

Then, after 18 months of extremely hard times, the economy lurched into recovery. By 1923, the U.S. had returned to full employment.

“By the end of 1916, American investors had wagered two billion dollars on an Entente victory,” computes Tooze (relative to America’s estimated GDP of $50 billion in 1916, the equivalent of $560 billion in today’s money).

the central assumption of his version of events is the same one captured in Rothbard’s title half a century ago: that America’s economic history constitutes a story unto itself.

Americans, meanwhile, were preoccupied with the problem of German recovery. How could Germany achieve political stability if it had to pay so much to France and Belgium? The Americans pressed the French to relent when it came to Germany, but insisted that their own claims be paid in full by both France and Britain.

Germany, for its part, could only pay if it could export, and especially to the world’s biggest and richest consumer market, the United States. The depression of 1920 killed those export hopes. Most immediately, the economic crisis sliced American consumer demand precisely when Europe needed it most.

But the gravest harm done by the depression to postwar recovery lasted long past 1921. To appreciate that, you have to understand the reasons why U.S. monetary authorities plunged the country into depression in 1920.

Monetary authorities, worried that inflation would revive and accelerate, made the fateful decision to slam the credit brakes, hard. Unlike the 1918 recession, that of 1920 was deliberately engineered. There was nothing invisible about it. Nor did the depression “cure itself.” U.S. officials cut interest rates and relaxed credit, and the economy predictably recovered

But 1920-21 was an inflation-stopper with a difference. In post-World War II America, anti-inflationists have been content to stop prices from rising. In 1920-21, monetary authorities actually sought to drive prices back to their pre-war levels

James Grant hails this accomplishment. Adam Tooze forces us to reckon with its consequences for the rest of the planet.

When the U.S. opted for massive deflation, it thrust upon every country that wished to return to the gold standard (and what respectable country would not?) an agonizing dilemma. Return to gold at 1913 values, and you would have to match U.S. deflation with an even steeper deflation of your own, accepting increased unemployment along the way. Alternatively, you could re-peg your currency to gold at a diminished rate. But that amounted to an admission that your money had permanently lost value—and that your own people, who had trusted their government with loans in local money, would receive a weaker return on their bonds than American creditors who had lent in dollars.

Britain chose the former course; pretty much everybody else chose the latter.

The consequences of these choices fill much of the second half of The Deluge. For Europeans, they were uniformly grim, and worse.

But one important effect ultimately rebounded on Americans. America’s determination to restore a dollar “as good as gold” not only imposed terrible hardship on war-ravaged Europe, it also threatened to flood American markets with low-cost European imports. The flip side of the Lost Generation enjoying cheap European travel with their strong dollars was German steelmakers and shipyards underpricing their American competitors with weak marks.

American leaders of the 1920s weren’t willing to accept this outcome. In 1921 and 1923, they raised tariffs, terminating a brief experiment with freer trade undertaken after the election of 1912. The world owed the United States billions of dollars, but the world was going to have to find another way of earning that money than selling goods to the United States.

Between 1924 and 1930, world financial flows could be simplified into a daisy chain of debt. Germans borrowed from Americans, and used the proceeds to pay reparations to the Belgians and French. The French and Belgians, in turn, repaid war debts to the British and Americans. The British then used their French and Italian debt payments to repay the United States, who set the whole crazy contraption in motion again. Everybody could see the system was crazy. Only the United States could fix it. It never did.

The reckless desperation of Hitler’s war provides context for the horrific crimes of his regime. Hitler’s empire could not feed itself, so his invasion plan for the Soviet Union contemplated the death by starvation of 20 to 30 million Soviet urban dwellers after the invaders stole all foodstuffs for their own use. Germany lacked workers, so it plundered the labor of its conquered peoples. By 1944, foreigners constituted 20 percent of the German workforce and 33 percent of armaments workers

“If man accumulates enough combustible material, God will provide the spark.” So it happened in 1929. The Deluge that had inundated the rest of the developed world roared back upon the United States.

From the start, the United States was Hitler’s ultimate target. “In seeking to explain the urgency of Hitler’s aggression, historians have underestimated his acute awareness of the threat posed to Germany, along with the rest of the European powers, by the emergence of the United States as the dominant global superpower,” Tooze writes. “The originality of National Socialism was that, rather than meekly accepting a place for Germany within a global economic order dominated by the affluent English-speaking countries, Hitler sought to mobilize the pent-up frustrations of his population to mount an epic challenge to this order.”

Germany was a weaker and poorer country in 1939 than it had been in 1914. Compared with Britain, let alone the United States, it lacked the basic elements of modernity: There were just 486,000 automobiles in Germany in 1932, and one-quarter of all Germans still worked as farmers as of 1925. Yet this backward land, with an income per capita comparable to contemporary “South Africa, Iran and Tunisia,” wagered on a second world war even more audacious than the first.

That way was found: more debt, especially more German debt. The 1923 hyper-inflation that wiped out Germany’s savers also tidied up the country’s balance sheet. Post-inflation Germany looked like a very creditworthy borrower.

On paper, the Nazi empire of 1942 represented a substantial economic bloc. But pillage and slavery are not workable bases for an industrial economy. Under German rule, the output of conquered Europe collapsed. The Hitlerian vision of a united German-led Eurasia equaling the Anglo-American bloc proved a crazed and genocidal fantasy.

The foundation of this order was America’s rise to unique economic predominance a century ago. That predominance is now coming to an end as China does what the Soviet Union and Imperial Germany never could: rise toward economic parity with the United States.

t is coming, and when it does, the fundamental basis of world-power politics over the past 100 years will have been removed. Just how big and dangerous a change that will be is the deepest theme of Adam Tooze's profound and brilliant grand narrative

“My comparison is to speed limits,” Ms. Admati said in an interview near the Stanford campus. “Basically what we have here is the market has decided nobody else should be driving faster than 70 miles an hour and these are the biggest trucks with the most explosive cargo and they are driving at almost 100 miles an hour.”

“At one level, the story on capital and liquidity ratios is very simple: From the viewpoint of the stability of the financial system, more of each is better,” he said. But the United States, he said, was constrained by practicality. If other countries aren’t willing to impose stricter capital requirements on their own banks — and they don’t appear to be — then unilateral increases would hurt the American banking industry and the broader economy.

“If you lower the speed limit on one highway, you’ll have fewer accidents on that highway,” he said. “But the other road will just get more crowded.”

Ms. Admati compares this logic to letting American manufacturers pollute so that they can compete more effectively with companies in China.

banks continue to rely on debt financing far more than other kinds of corporations. Last year, the eight largest American banks together derived less than 5 percent of their funding from shareholders, according to Thomas M. Hoenig, vice chairman of the Federal Deposit Insurance Corporation. The average equity financing for nonfinancial corporations was about 60 percent.

Banking is the only industry subject to systematic capital regulation. Borrowing by most companies is effectively regulated by the caution of lenders. But the largest lenders to banks are depositors, who generally have no reason to be cautious because federal deposit insurance guarantees repayment of up to $250,000 even if the bank fails. This means the government, which takes the risk, must also impose the discipline.

The industry’s more serious argument is that equity is more expensive than debt. If governments require banks to raise more equity, the industry warns, the results would be higher interest rates, less lending and slower economic growth.

an increase of 10 percentage points in capital requirements would raise interest rates by 0.25 to 0.45 percentage points.

This, in the view of Ms. Admati, is a small price to pay for fewer crises. She notes that debt is cheaper than equity largely because of government subsidies — not just deposit insurance but also tax deductions for interest payments on other kinds of debt — so more equity would basically transfer costs from taxpayers to banks

the economic impact may well be positive. A study last year by Benjamin H. Cohen, an economist at the Bank for International Settlements, found that banks with more capital tended to make more loans.

Ms. Admati says large banks should be required to raise at least 30 percent of their funding in the form of equity, about six times more than the current average for the largest American banks.

she says, banks should be required to suspend dividend payments, thus increasing their equity by retaining their profits, until they are sufficiently capitalized.

She freely concedes that there is no particular science behind her 30 percent equity figure. The point, she says, is that 5 percent is the wrong ballpark. The proper baseline, in her view, is what the market imposes on other kinds of companies.

“We have too much belief that we can be precise,” she said. “I don’t mean 20 percent. I don’t mean 30 percent. I mean add a digit. I mean a lot more.”

The type of inequality that currently characterizes the world’s economies is unlike anything seen in recent years

“Between 2002 and 2010 the total wealth of the poorest half of the world in current U.S. dollars had been increasing more or less at the same rate as that of billionaires,” it said. “However since 2010, it has been decreasing over that time.”

“Do we really want to live in a world where the 1 percent own more than the rest of us combined?” Ms. Byanyima said. “The scale of global inequality is quite simply staggering.”

Investors with interests in finance, insurance and health saw the biggest windfalls, Oxfam said

More than a quarter of those with incomes between the middle of the income distribution and the 75th percentile will probably run short.

The standard prescription is that Americans should put more money aside in investments. The recommendation, however, glosses over a critical driver of unpreparedness: Wall Street is bleeding savers dry.

“A greater part of the problem is the failure of investors to earn their fair share of market returns.”

His observation suggests a different policy prescription: shoring up Americans’ retirement requires, first of all, aligning the interests of investment advisers and their clients.

Actively managed mutual funds, in which many workers invest their retirement savings, are enormously costly.

Altogether, costs add up to 2.27 percent per year, Mr. Bogle estimates.

By contrast, a passive index fund, like Vanguard’s Total Stock Market Index Fund, costs merely 0.06 percent a year in all.

Assuming an annual market return of 7 percent, he says, a 30-year-old worker who made $30,000 a year and received a 3 percent annual raise could retire at age 70 with $927,000 in the pot by saving 10 percent of her wages every year in a passive index fund. (Such a nest egg, at the standard withdrawal rate of 4 percent, would generate an inflation-adjusted $37,000 a year more or less indefinitely.) If she put it in a typical actively managed fund, she would end up with only $561,000.

In 1979, almost two in five private sector workers had a defined-benefit pension that would pay out a check until they died. Today only 14 percent do. Almost one in three, by contrast, must make do with a retirement savings account alone to supplement their Social Security check.

nobody was paying attention to the safeguards that might be needed when corporate retirement funds managed by sophisticated professionals were replaced by individual 401(k)s and Individual Retirement Accounts.

“Wall Street makes no money on low-cost index funds,” said David F. Swensen, who runs the investment portfolio for Yale. “That is the problem.”

Harvard and colleagues from M.I.T. and the University of Hamburg sent “mystery shoppers” to visit financial advisers. They found that advisers mostly recommended investment strategies that fit their own financial interests. They reinforced their clients’ misguided biases, encouraging them to chase returns and advising against low-cost options like low-fee index funds.

For all their flaws, 401(k) plans have a fiduciary responsibility to act in participants’ best interest. Managers of I.R.A.s, by contrast, are not legally bound to put their clients’ interests first. They must offer “suitable” products — a much squishier standard.

The White House’s Council of Economic Advisers argues that “conflicted advice” by advisers who get payments from the funds they recommend reduces the annual returns to investment by 1 percentage point, a more modest penalty than Mr. Bogle’s analysis

In 2010, the Labor Department proposed imposing fiduciary responsibility on I.R.A. advisers. The resistance from Wall Street was so fierce that the Obama administration was forced to back down. Last month, the administration tried again.

Unlike regulations in Canada and some Western European countries, which have essentially banned kickbacks from funds to investment advisers, the Obama administration’s proposed rule does not directly attack conflicts of interest.

on occasion, Google X will send projects back to the core company so they can have a more immediate benefit. That is what happened to Google’s neural network project (formerly called “Google Brain”) a so-called machine learning effort in which researchers use algorithms to teach computers to do things like read text or understand spoken language.

“It would be fair to say Google Brain is producing in value for Google something that would be comparable to the total costs in Google X — just that one thing we’ve spun out,” Mr. Teller said.

But I wouldn’t be so sure. True, a new president who looked at the evidence and listened to the experts wouldn’t go down that path. But evidence and expertise have a well-known liberal bias.

Financial markets seem to believe the same. At any rate, there’s no sign in current asset prices that investors see a significant chance of the catastrophe that would follow a return to gold.

The interesting question is what will happen to monetary policy if a Republican wins next year’s election. As best as I can tell, most economists believe that it’s all talk, that once in the White House someone like Mr. Rubio or even Mr. Cruz would return to Bush-style monetary pragmatism.

this hard-money orthodoxy is relatively new. Republicans used to base their monetary recommendations on the ideas of Milton Friedman, who opposed Keynesian policies to fight depressions, but only because he thought easy money could do the job better, and who called on Japan to adopt the same strategy of “quantitative easing” that today’s Republicans denounce.

George W. Bush’s economists praised the “aggressive monetary policy” that, they declared, had helped the economy recover from the 2001 recession. And Mr. Bush appointed Ben Bernanke, who used to consider himself a Republican, to lead the Fed.

The Chinese authorities have acted after a string of poor economic figures showed that previous efforts to boost exports and growth against the headwind of an overvalued currency had failed.

As part of the devaluation, the authorities said they would widen the criteria to include more market information, allowing the currency to rise or fall more rapidly than before. The central bank sought to reassure financial markets that it was not embarking on a steady depreciation.

Albert Edwards, analyst at Societe Generale, said the yuan had become overvalued against the dollar in recent years and was unsustainably high relative to other major currencies.

Unlike the pound and other major currencies, the yuan’s value is determined each day by the People’s Bank based on movements the previous day.

One financial analyst said the devaluation, which pushed the yuan to a four-year low, heralded a tidal wave of cheap goods from Asia as other south east Asian countries followed suit.

A spokesman said the downward movement of the currency was a result of a project to liberalise its management and not a deliberate attempt to drive down its value.

Oil prices remained below $50 a barrel, down from more than $110 a barrel last summer when the slowdown in China first became apparent. The prices of key industrial and construction metals – nickel, copper and aluminium – hit six-year lows.