Editor's note.

• Author: Dorn, J.A.
• Position: Ways to escape financial crises and poverty reduction

Poverty reduction requires adopting the fight institutions, including monetary institutions. This issue of the Cato Journal examines the impact of alternative monetary arrangements on economic development. The articles were first presented at the Cato Institute's 23rd Annual Monetary Conference--Monetary Institutions and Economic Development--cosponsored with The Economist, November 3, 2005. I thank the authors for updating their articles to reflect ongoing changes in the international financial architecture, especially China's currency reform.

The various financial crises that plagued the global economy in the last two decades of the 20th century taught us important lessons. But as Kenneth Rogoff asks in his article, "Will emerging markets escape the next big systemic financial crisis?"

The growing global imbalances are not sustainable and will require adjustments, which will be smoother if markets lead the way rather than reverting to destructive protectionism. The United States, in particular, needs to address its own twin deficits by increasing saving and cutting the fiscal deficit before telling other countries what to do, argues Nouriel Roubini. And Samuel Brittan adds, "It is ironic that Western statesmen play down the genuine grounds for criticizing Chinese leaders, such as their still appalling human rights record ..., and instead lecture the Chinese on the need to revalue the renminbi."

In considering how global imbalances and financial crises will be resolved in the post-Greenspan era, it is essential to recognize the close link between monetary credibility and sustainable development, as both Roger W. Ferguson Jr. and Mickey Levy do. Although inflation was held in check during the Greenspan era, William Niskanen shows that mistakes were made. In particular, the Fed provided too much...