The Money Trap: Escaping the Grip of Global Finance.

• Author: Shelton, Judy
• Position: Book review

The Money Trap: Escaping the Grip of Global Finance

Robert Pringle

Basingstoke, UK: Palgrave Macmillan, 2012, 328 pp.

To read Robert Pringle's new book, The Money Trap, is to experience the slow joy of recognizing that someone out there in the world of intellectual propriety and academic correctness is willing to state the case that the global financial crisis can be traced in large part to the lack of an orderly international monetary system.

Pringle has done a great service in bringing to the debate over the causes of what is now called "the worst recession since the Great Depression" the notion that the global exchange rate regime matters; we cannot ignore the damaging impact of chaotic exchange rates among leading currencies if we are to identify what brought on the financial meltdown that has since devastated real economies around the world. But even more important, Pringle's careful analysis and assiduous tracing of events leading to the crisis provide the reader with a template for evaluating potential paths to meaningful international monetary reform. In this, he has done a service to mankind-for as Pringle notes repeatedly throughout this work, the achievement of monetary and financial stability should be pursued as a "global public good."

It is important to note the unique credentials of the author-unique in that one would not normally expect the chairman of Central Banking Publications and the founder of the Central Banking Journal to be making the argument that fundamental reform of international monetary arrangements is needed. Pringle occupies a prestigious position among those who closely follow developments affecting international money and capital markets, having served in a senior capacity at The Economist and The Banker (as editor) as well as becoming first executive director of the Group of 30, an influential think tank. His experience in advising leading commercial banks and governments on economic policy issues has brought him into the highest circles of high finance. One wonders whether Pringle will find himself less welcome at the same watering holes as a result of delivering this stinging critique of status quo global monetary and financial arrangements.

Not that he is totally alone in advancing such doubts about the wisdom of our current monetary non-system. A special bonus contained in The Money Trap is the foreword written by Robert Skidelsky-yes, Lord Skidelsky, the eminent biographer of economist John Maynard...