Stephen Roach

Stephen Roach

Stephen S. Roach, a faculty member at Yale University and former chairman of Morgan Stanley Asia, is the author of Unbalanced: The Codependency of America and China.

Latest from Stephen Roach

The View | China’s changing growth model, not Evergrande, is the top threat to prosperity

The new emphasis on redistribution plus re-regulation strikes at the heart of the reform that has underpinned China’s growth. The Evergrande crisis will pass, but a regulatory clampdown amid a push to redistribute wealth could rewind the Chinese miracle.

The new emphasis on redistribution plus re-regulation strikes at the heart of the reform that has underpinned China’s growth. The Evergrande crisis will pass, but a regulatory clampdown amid a push to redistribute wealth could rewind the Chinese miracle.

China’s changing growth model, not Evergrande, is the top threat to prosperity
4 Oct 2021 - 7:32PM
The View | China’s regulation of its spirited tech sector could be a tipping point for the economy

There are legitimate reasons for China’s anti-tech campaign, but when the full force of regulation is used to strangle the business models and financing capacity of the economy’s most dynamic sector, it weakens confidence and the entrepreneurial spirit.

There are legitimate reasons for China’s anti-tech campaign, but when the full force of regulation is used to strangle the business models and financing capacity of the economy’s most dynamic sector, it weakens confidence and the entrepreneurial spirit.

China’s regulation of its spirited tech sector could be a tipping point for the economy
29 Jul 2021 - 5:31AM
Macroscope | How the US Fed’s reassurances on inflation fears are triggering a 1970s flashback

Now as then, the Fed sees increases in the prices of food and other essentials as transitory. But the biggest parallel may be another policy blunder – as before, the Fed is keeping real interest rates depressed, which in the 1970s only fuelled inflation.

Now as then, the Fed sees increases in the prices of food and other essentials as transitory. But the biggest parallel may be another policy blunder – as before, the Fed is keeping real interest rates depressed, which in the 1970s only fuelled inflation.

How the US Fed’s reassurances on inflation fears are triggering a 1970s flashback
26 May 2021 - 10:25PM
The View | US-China relations: why Joe Biden should go back to basics

Both sides should focus on the economic and trade issues that have long anchored the US-China relationship. That doesn’t mean dismissing other tough issues, but re-establishing common ground and trust before expanding the agenda.

Both sides should focus on the economic and trade issues that have long anchored the US-China relationship. That doesn’t mean dismissing other tough issues, but re-establishing common ground and trust before expanding the agenda.

US-China relations: why Joe Biden should go back to basics
25 Mar 2021 - 2:32AM
The View | Coronavirus vaccinations: even herd immunity may not revive America’s lost consumer spending

Notwithstanding the release of pent-up demand for consumer durables, face-to-face services, including food and entertainment services, show signs of lasting damage.

Notwithstanding the release of pent-up demand for consumer durables, face-to-face services, including food and entertainment services, show signs of lasting damage.

Coronavirus vaccinations: even herd immunity may not revive America’s lost consumer spending
24 Feb 2021 - 2:09AM
Opinion | US Capitol riot: how the internet exposes the weak links in American democracy

The internet’s role in fomenting insurrection at the US Capitol has shone a light on the flaws of the West’s embrace of open-ended connectivity. The challenge remains for the West to prevent the breakdown of order in a free society.

The internet’s role in fomenting insurrection at the US Capitol has shone a light on the flaws of the West’s embrace of open-ended connectivity. The challenge remains for the West to prevent the breakdown of order in a free society.

US Capitol riot: how the internet exposes the weak links in American democracy
21 Jan 2021 - 9:40PM
Opinion | The coronavirus pandemic may cast a longer economic shadow on the US than policymakers think

Mass vaccination does not provide immunity against longer-term economic damage. And research on major pandemics dating back to the 14th century suggests Covid-19’s impact on the US economy will be far-reaching and profound.

Mass vaccination does not provide immunity against longer-term economic damage. And research on major pandemics dating back to the 14th century suggests Covid-19’s impact on the US economy will be far-reaching and profound.

The coronavirus pandemic may cast a longer economic shadow on the US than policymakers think
23 Dec 2020 - 2:36AM
Opinion | Despite coronavirus vaccine hope, US must brace itself for a winter of despair

Vaccination is unlikely to bring about so-called herd immunity until mid-2021. For a vulnerable US economy entering lockdown again, the case for a double-dip recession is compelling.

Vaccination is unlikely to bring about so-called herd immunity until mid-2021. For a vulnerable US economy entering lockdown again, the case for a double-dip recession is compelling.

Despite coronavirus vaccine hope, US must brace itself for a winter of despair
26 Nov 2020 - 5:25AM
Opinion | How ‘Covid first’ China is trumping ‘America first’ in economic recovery

In 2008, China responded to the financial crisis by addressing the source of the shock itself, not the collateral damage the shock caused. Beijing’s approach to Covid-19 is similar. By contrast, the US is paying for its government’s inability or unwillingness to limit the contagion.

In 2008, China responded to the financial crisis by addressing the source of the shock itself, not the collateral damage the shock caused. Beijing’s approach to Covid-19 is similar. By contrast, the US is paying for its government’s inability or unwillingness to limit the contagion.

How ‘Covid first’ China is trumping ‘America first’ in economic recovery
27 Oct 2020 - 4:50PM
Opinion | Why the US dollar is only going to fall faster and harder

Given the unprecedented erosion of domestic savings, an explosive current account deficit, and the Fed determined to keep rates flat, expect the dollar to plunge by as much as 35 per cent next year.

Given the unprecedented erosion of domestic savings, an explosive current account deficit, and the Fed determined to keep rates flat, expect the dollar to plunge by as much as 35 per cent next year.

Why the US dollar is only going to fall faster and harder
27 Sep 2020 - 7:27PM
The View | America must brace itself for a double-dip economic recession

Financial markets’ optimism about a V-shaped recovery from Covid-19 is not supported by the history of the US business cycle. With America still struggling to contain the pandemic, the lingering fears of infection will continue to impede any lasting recovery.

Financial markets’ optimism about a V-shaped recovery from Covid-19 is not supported by the history of the US business cycle. With America still struggling to contain the pandemic, the lingering fears of infection will continue to impede any lasting recovery.

America must brace itself for a double-dip economic recession
27 Aug 2020 - 2:51AM
The View | How the coronavirus may deliver a shock to the US dollar

US domestic saving, already depressed, is headed deep into negative territory. This is likely to lead to a record current-account deficit, and the US could see a 35 per cent dollar plunge over the next two to three years.

US domestic saving, already depressed, is headed deep into negative territory. This is likely to lead to a record current-account deficit, and the US could see a 35 per cent dollar plunge over the next two to three years.

How the coronavirus may deliver a shock to the US dollar
25 Jun 2020 - 3:33AM
Opinion | The coronavirus crisis has finally sunk the US-China relationship. What’s next?

China’s economic rebalancing set the stage for an uneasy shift in relations, and now tit-for-tat blame over the pandemic has pitched the tension into open conflict. Both Chinese and Americans will be worse off in the new cold war.

China’s economic rebalancing set the stage for an uneasy shift in relations, and now tit-for-tat blame over the pandemic has pitched the tension into open conflict. Both Chinese and Americans will be worse off in the new cold war.

The coronavirus crisis has finally sunk the US-China relationship. What’s next?
29 Apr 2020 - 4:10AM
Opinion | Why the ‘big bazooka’ used in the 2008 financial meltdown is the wrong weapon for the coronavirus crisis

The global financial crisis playbook was designed for a world facing threats to the quantity of economic growth. It cannot be the answer for a world facing a shock stemming from deficiencies in the quality of that growth.

The global financial crisis playbook was designed for a world facing threats to the quantity of economic growth. It cannot be the answer for a world facing a shock stemming from deficiencies in the quality of that growth.

Why the ‘big bazooka’ used in the 2008 financial meltdown is the wrong weapon for the coronavirus crisis
21 Mar 2020 - 3:44AM
The View | Unlike during Sars, this coronavirus epidemic is hitting the global economy when it’s down

The outbreak will pass, but it is unlikely to be the temporary blip that complacent financial markets expect, given the central role China now plays in many aspects of the world economy and the vulnerabilities in major economies.

The outbreak will pass, but it is unlikely to be the temporary blip that complacent financial markets expect, given the central role China now plays in many aspects of the world economy and the vulnerabilities in major economies.

Unlike during Sars, this coronavirus epidemic is hitting the global economy when it’s down
25 Feb 2020 - 10:26PM
The View | The world economy is on the precipice, and don’t look to trade growth to cushion a fall

The IMF’s latest assessment of the global outlook is sobering – a shock event will easily tip fragile economies into recession. Global trade is sluggish from the impact of protectionism. An expansion in cross-border trade, a reliable growth driver in the past, is unlikely.

The IMF’s latest assessment of the global outlook is sobering – a shock event will easily tip fragile economies into recession. Global trade is sluggish from the impact of protectionism. An expansion in cross-border trade, a reliable growth driver in the past, is unlikely.

The world economy is on the precipice, and don’t look to trade growth to cushion a fall
28 Jan 2020 - 11:05PM
Opinion | For the cause of the next financial crisis, look to central banks’ overextended balance sheets

Assets of the US Federal Reserve, European Central Banks and Bank of Japan stand at 3.5 times their pre-crisis level. Protectionism, populism and political dysfunction could provide the trigger that tips vulnerable global markets into crisis.

Assets of the US Federal Reserve, European Central Banks and Bank of Japan stand at 3.5 times their pre-crisis level. Protectionism, populism and political dysfunction could provide the trigger that tips vulnerable global markets into crisis.

For the cause of the next financial crisis, look to central banks’ overextended balance sheets
26 Dec 2019 - 2:53AM
Opinion | If Trump’s interest in the US-China trade war is flagging and a deal is near, what will the future look like?

The US president and China both seem ready for a trade-war truce. While fears of deglobalisation and global decoupling are overblown, the US may still divert trade away from China, at a cost to American consumers.

The US president and China both seem ready for a trade-war truce. While fears of deglobalisation and global decoupling are overblown, the US may still divert trade away from China, at a cost to American consumers.

If Trump’s interest in the US-China trade war is flagging and a deal is near, what will the future look like?
27 Nov 2019 - 3:49AM
The View | In the rush to demonise China over trade, the West has failed to give Beijing enough credit for its green leadership

China is focusing on sustainability at a point when its per capita output is barely more than one-third that of advanced economies. A relatively poor country has made a conscious choice to shift from the quantity to the quality of growth.

China is focusing on sustainability at a point when its per capita output is barely more than one-third that of advanced economies. A relatively poor country has made a conscious choice to shift from the quantity to the quality of growth.

In the rush to demonise China over trade, the West has failed to give Beijing enough credit for its green leadership
26 Sep 2019 - 2:25AM
Opinion | Trump’s incoherent policies take aim at a China that no longer exists

The US president, by failing to recognise a China in transition, is applying bizarre trade and economic fixes that fail to neutralise its existential threat to America and will end up destabilising the global economy.

The US president, by failing to recognise a China in transition, is applying bizarre trade and economic fixes that fail to neutralise its existential threat to America and will end up destabilising the global economy.

Trump’s incoherent policies take aim at a China that no longer exists
29 Aug 2019 - 2:04AM
Opinion | For all his bluster, Donald Trump’s approach to economics has three basic flaws. Look to 2020 for their impact

From corporate tax cuts to the trade war to putting pressure on the Federal Reserve, Trump has ignored the lessons of history and failed to grasp the link between budget deficits, tariffs and monetary policy.

From corporate tax cuts to the trade war to putting pressure on the Federal Reserve, Trump has ignored the lessons of history and failed to grasp the link between budget deficits, tariffs and monetary policy.

For all his bluster, Donald Trump’s approach to economics has three basic flaws. Look to 2020 for their impact
26 Jun 2019 - 3:11AM
Opinion | Why Donald Trump can’t make America great again by replicating Ronald Reagan’s script

Unlike Reagan who targeted Japan in the 1980s, Trump has inherited a US economy with a chronically low savings rate and that is much more globally integrated. Without the US raising national saving, trade will simply shift from China to other countries.

Unlike Reagan who targeted Japan in the 1980s, Trump has inherited a US economy with a chronically low savings rate and that is much more globally integrated. Without the US raising national saving, trade will simply shift from China to other countries.

Why Donald Trump can’t make America great again by replicating Ronald Reagan’s script
29 May 2019 - 2:20PM
Opinion | Donald Trump’s case against China is deeply flawed and ignores weaknesses in the American economy

The US narrative on China – from the trade deficit to intellectual property theft to support for state-owned enterprises – rests on shaky foundations and does not account for America’s macroeconomic shortcomings.

The US narrative on China – from the trade deficit to intellectual property theft to support for state-owned enterprises – rests on shaky foundations and does not account for America’s macroeconomic shortcomings.

Donald Trump’s case against China is deeply flawed and ignores weaknesses in the American economy
30 Apr 2019 - 5:30PM
Opinion | Donald Trump is wrong. The US economy is not strong enough to win cold war 2.0

While the US prevailed in the cold war with the Soviet Union, its economy is in a much weaker position today. Both the US and China should resolve their own economic imbalances and then work together to preserve the post-war world order.

While the US prevailed in the cold war with the Soviet Union, its economy is in a much weaker position today. Both the US and China should resolve their own economic imbalances and then work together to preserve the post-war world order.

Donald Trump is wrong. The US economy is not strong enough to win cold war 2.0
4 Apr 2019 - 2:14AM
Opinion | How US trade negotiators are misreading China while ignoring America’s dangerously low savings rate

China’s recent economic slowdown is less a result of the trade war than its deleveraging campaign, which can be adjusted as needed. Meanwhile, US economic strength is likely to be short-lived as the effect of its tax cuts fades.

China’s recent economic slowdown is less a result of the trade war than its deleveraging campaign, which can be adjusted as needed. Meanwhile, US economic strength is likely to be short-lived as the effect of its tax cuts fades.

How US trade negotiators are misreading China while ignoring America’s dangerously low savings rate
26 Feb 2019 - 1:41PM
Opinion | The US-China trade war and Brexit are dealing body blows to already weak global trade

Growing protectionism, increased tariffs and Brexit-induced disruption are all adding stress to the global trade cycle and could spark a sudden downturn from which no major economy will be spared.

Growing protectionism, increased tariffs and Brexit-induced disruption are all adding stress to the global trade cycle and could spark a sudden downturn from which no major economy will be spared.

The US-China trade war and Brexit are dealing body blows to already weak global trade
30 Jan 2019 - 3:39AM
Opinion | Rising interest rates mean the US Federal Reserve is back to the fundamentals, and that’s reason to celebrate

The Federal Reserve’s interest rate increases show the central bank is returning to the era of reliance on market fundamentals, ending the period of asset-friendly easy money.

The Federal Reserve’s interest rate increases show the central bank is returning to the era of reliance on market fundamentals, ending the period of asset-friendly easy money.

Rising interest rates mean the US Federal Reserve is back to the fundamentals, and that’s reason to celebrate
27 Dec 2018 - 3:17AM
Opinion | Four ways Donald Trump and Xi Jinping could reframe US-China relations at their G20 meeting

A bilateral US-China investment treaty to resolve conflict over market access and macroeconomic adjustments on savings would go a long way towards resolving differences. A global accord on cybersecurity and a permanent secretariat for bilateral dialogue would also be productive.

A bilateral US-China investment treaty to resolve conflict over market access and macroeconomic adjustments on savings would go a long way towards resolving differences. A global accord on cybersecurity and a permanent secretariat for bilateral dialogue would also be productive.

Four ways Donald Trump and Xi Jinping could reframe US-China relations at their G20 meeting
27 Nov 2018 - 4:02AM
Opinion | US inflation is set to rise. The Fed must act now

Stephen Roach says the trade war’s impact on global value chains and the tight US labour market will fan inflationary pressures of the current US economic upturn, so the Fed is right to press on with monetary tightening – and should, perhaps, even step it up

Stephen Roach says the trade war’s impact on global value chains and the tight US labour market will fan inflationary pressures of the current US economic upturn, so the Fed is right to press on with monetary tightening – and should, perhaps, even step it up

US inflation is set to rise. The Fed must act now
24 Oct 2018 - 1:56AM
Opinion | US-China marriage of convenience has fallen into codependency – can it avoid a messy divorce?

China’s shift in its growth model away from heavy savings has become a source of discomfort to the US but the relationship can be transformed into one of mutual interdependence.

China’s shift in its growth model away from heavy savings has become a source of discomfort to the US but the relationship can be transformed into one of mutual interdependence.

US-China marriage of convenience has fallen into codependency – can it avoid a messy divorce?
27 Sep 2018 - 7:17PM