Paul Sheard

Last updated

Paul Sheard
SheardPaulJames.SPG.jpg
Born (1954-11-25) November 25, 1954 (age 70)
Glenelg, South Australia, Australia
Occupation Economist
NationalityAustralian/American
EducationBA (Hons), Monash University
PhD, MEc, Australian National University
SpouseYoshiko Sheard

Paul James Sheard (born November 25, 1954) is an Australian-American economist. Most recently he was Research Fellow and earlier M-RCBG Senior Fellow at Harvard Kennedy School's Mossavar-Rahmani Center for Business and Government, [1] after previously being Vice Chairman of S&P Global. [2] Sheard has held chief economist positions at Lehman Brothers, Nomura Securities, Standard & Poor's Ratings Services, and S&P Global. Prior to entering financial markets in 1995, he was an academic economist based in Australia, Japan and the United States, specializing in the Japanese economy and the economics of firm organization. He was a member of the World Economic Forum's Global Future Council on the New Agenda for Fiscal and Monetary Policy (2020-2022), having been a member of the WEF's Global Future Council on the New Economic Agenda (2018-2020) and of its Global Agenda Council on the International Monetary System (2010-2012). [3] He is a member of the board of the Foreign Policy Association and is a member of the advisory board of the Levy Economics Institute of Bard College. He is a member of the Bretton Woods Committee, [4] the Council on Foreign Relations, the Economic Club of New York and the National Committee on U.S.-China Relations. He attends and speaks regularly at conferences around the world, [5] [6] [7] [8] and his views on the global economy and economic policy are frequently cited in the international press. [9] [10] [11] [12] [13]

Contents

Career

Sheard was Kiyoshi Kojima Postdoctoral Fellow at the Australia-Japan Research Centre, [14] ANU, Lecturer in Economics, and later Associate Professor of Economics at Osaka University. He held visiting scholar positions at Osaka University, the Bank of Japan, and Stanford University, where he was also visiting assistant professor of economics.

In January 1995, Sheard became Japan Strategist for Baring Asset Management and later Head of Japan Equity Investments. In September 2000, he was appointed Chief Economist for Asia of Lehman Brothers and became Global Chief Economist of Lehman in April 2006. When Lehman failed in September 2008, after a stint at Barclays Capital, in November 2008 Sheard was appointed Global Chief Economist and Head of Economic Research at Nomura Securities, based in New York. [15] In June 2012, he moved to Standard & Poor's Ratings Services as Global Chief Economist and Head of Global Economics and Research and a member of the firm's executive committee, later becoming Chief Economist and Executive Vice President of S&P Global, the parent firm.

Sheard served as a member of committees of the Japanese Government's Economic Deliberation Council, in 1997-98 as an appointee of Prime Minister Ryutaro Hashimoto and in 1998-99 as an appointee of Prime Minister Keizo Obuchi. He served as a member of the oversight board of the Japanese Government's Research Institute of Economy, Trade and Industry, [16] 2001–2006. From 2003 to 2010, Sheard served as a non-executive director of ORIX Corporation, a large Japanese financial services firm.

Contributions

Sheard's academic work analyzed the economic rationale of distinct features of Japanese corporate organization, including the role of multi-tier subcontracting networks in the auto sector; [17] the role of main banks and interlocking shareholdings in creating an internalized market for corporate control that supported the "lifetime" employment system; [18] [19] [20] the informational and risk-sharing role of general trading companies (Sogo shosha) as financial intermediaries; [21] and assessing the arguments that Japanese firms avoided short-termism. [22] In the "structural impediments" debate of the early 1990s, Sheard argued that many of the features criticized as "non-tariff barriers" or as being anti-competitive were better understood in terms of how firms and markets in Japan were efficiently organized. [23] He pointed out that the common practice of characterizing keiretsu or affiliated enterprise groups in Japan as "horizontal groups" was confusing because to many foreign observers "horizontal" connoted within-same-market whereas most of the relationships in question were "vertical" (between stages of production) or between-market in nature. [24]

As a markets economist in Tokyo, Sheard was active in the policy debate, identifying two factors as contributing to Japan's falling into and remaining in deflation: the failure of the government to aggressively recapitalize the banks after it issued a blanket guarantee of deposits in June 1995 and the aggregate demand management policy mix, under macro deleveraging, of "timid" monetary policy and stop-start fiscal policy. [25]

After the Global Financial Crisis and Great Recession, Sheard argued that sustained, aggressive monetary and fiscal policy expansion was needed to restore lost aggregate demand in the developed economies. [26]

He has argued that quantitative easing (QE), far from being inflationary "money printing," is best viewed as a "debt management operation of the consolidated government" whereby the central bank retires government debt securities and refinances them into central bank money, [27] and that, contrary to common parlance, banks cannot "lend out" their excess reserves. [28] [29] Sheard argues that, QE being a mild form of monetary easing, the unwinding of QE, in principle, is an innocuous process. [30] [31]

Invoking the metaphor of a "Monetary Garden of Eden", [32] Sheard has argued that monetary and fiscal policies should be viewed as "two sides of the same sovereign coin" and much more closely coordinated and aligned, particularly when the threat to full employment and price stability is "from below," and that the macroeconomic policy framework needs to be reformed to enable that. [33] [34] [35] [36]

Sheard has argued that monetary union without fiscal union in the euro area is unsustainable, describing the architecture of the euro area at the time of the sovereign debt crisis as akin to putting countries, when hit by a sudden loss of aggregate demand, in a "macroeconomic vice," and that a steady-state solution must involve "either less monetary union or more fiscal union." [37] Sheard identifies the fundamental problem with the economic and political architecture of the European Union as being the "selective sharing of sovereignty," viewing Brexit as being as much about the future of the EU as about the UK's relationship with the EU. [38] [39]

Long a critic of the Bank of Japan's monetary policy communication and action, [40] Sheard has been a strong supporter of the Bank's April 2013 policy shift under Governor Haruhiko Kuroda, [41] [42] describing it as the monetary policy equivalent of a Copernican Revolution. [43]

Education

Sheard received a Bachelor of Arts (Honours in Japanese and Geography) from Monash University (1981) and a PhD in Japanese Economy (1986) and Master of Economics (1988) from the ANU. [44] [45]

Awards and recognition

Sheard's 1981 undergraduate thesis was awarded the Institute of Australian Geographers’ Honours Thesis of the Year. [46] His 1997 book in Japanese, Mein Banku Shihon Shugi no Kiki (The Crisis of Main Bank Capitalism), [47] published by Toyo Keizai Shinposha, was awarded the 1998 Suntory Gakugei Prize in the Economics-Politics Section. In 2006, Sheard was recognized by Advance as one of 100 Leading Global Australians. [48] [49]

In May 2019, Monash University conferred an honorary Doctor of Laws on Sheard.[ citation needed ]

Books

Related Research Articles

<span class="mw-page-title-main">International Monetary Fund</span> International financial institution

The International Monetary Fund (IMF) is a major financial agency of the United Nations, and an international financial institution funded by 191 member countries, with headquarters in Washington, D.C. It is regarded as the global lender of last resort to national governments, and a leading supporter of exchange-rate stability. Its stated mission is "working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world."

<span class="mw-page-title-main">Macroeconomics</span> Study of an economy as a whole

Macroeconomics is a branch of economics that deals with the performance, structure, behavior, and decision-making of an economy as a whole. This includes regional, national, and global economies. Macroeconomists study topics such as output/GDP and national income, unemployment, price indices and inflation, consumption, saving, investment, energy, international trade, and international finance.

New Keynesian economics is a school of macroeconomics that strives to provide microeconomic foundations for Keynesian economics. It developed partly as a response to criticisms of Keynesian macroeconomics by adherents of new classical macroeconomics.

<span class="mw-page-title-main">Global financial system</span> Global framework for capital flows

The global financial system is the worldwide framework of legal agreements, institutions, and both formal and informal economic action that together facilitate international flows of financial capital for purposes of investment and trade financing. Since emerging in the late 19th century during the first modern wave of economic globalization, its evolution is marked by the establishment of central banks, multilateral treaties, and intergovernmental organizations aimed at improving the transparency, regulation, and effectiveness of international markets. In the late 1800s, world migration and communication technology facilitated unprecedented growth in international trade and investment. At the onset of World War I, trade contracted as foreign exchange markets became paralyzed by money market illiquidity. Countries sought to defend against external shocks with protectionist policies and trade virtually halted by 1933, worsening the effects of the global Great Depression until a series of reciprocal trade agreements slowly reduced tariffs worldwide. Efforts to revamp the international monetary system after World War II improved exchange rate stability, fostering record growth in global finance.

<span class="mw-page-title-main">Monetary policy</span> Policy of interest rates or money supply

Monetary policy is the policy adopted by the monetary authority of a nation to affect monetary and other financial conditions to accomplish broader objectives like high employment and price stability. Further purposes of a monetary policy may be to contribute to economic stability or to maintain predictable exchange rates with other currencies. Today most central banks in developed countries conduct their monetary policy within an inflation targeting framework, whereas the monetary policies of most developing countries' central banks target some kind of a fixed exchange rate system. A third monetary policy strategy, targeting the money supply, was widely followed during the 1980s, but has diminished in popularity since then, though it is still the official strategy in a number of emerging economies.

<span class="mw-page-title-main">Money creation</span> Process by which the money supply of an economic region is increased

Money creation, or money issuance, is the process by which the money supply of a country, or an economic or monetary region, is increased. In most modern economies, money is created by both central banks and commercial banks. Money issued by central banks is a liability, typically called reserve deposits, and is only available for use by central bank account holders, which are generally large commercial banks and foreign central banks.

Modern monetary theory or modern money theory (MMT) is a heterodox macroeconomic theory that describes currency as a public monopoly and unemployment as evidence that a currency monopolist is overly restricting the supply of the financial assets needed to pay taxes and satisfy savings desires. According to MMT, governments do not need to worry about accumulating debt since they can pay interest by printing money. MMT argues that the primary risk once the economy reaches full employment is inflation, which acts as the only constraint on spending. MMT also argues that inflation can be controlled by increasing taxes on everyone, to reduce the spending capacity of the private sector.

Capital controls are residency-based measures such as transaction taxes, other limits, or outright prohibitions that a nation's government can use to regulate flows from capital markets into and out of the country's capital account. These measures may be economy-wide, sector-specific, or industry specific. They may apply to all flows, or may differentiate by type or duration of the flow.

<span class="mw-page-title-main">Dynamic stochastic general equilibrium</span> Macroeconomic method

Dynamic stochastic general equilibrium modeling is a macroeconomic method which is often employed by monetary and fiscal authorities for policy analysis, explaining historical time-series data, as well as future forecasting purposes. DSGE econometric modelling applies general equilibrium theory and microeconomic principles in a tractable manner to postulate economic phenomena, such as economic growth and business cycles, as well as policy effects and market shocks.

The neoclassical synthesis (NCS), or neoclassical–Keynesian synthesis is an academic movement and paradigm in economics that worked towards reconciling the macroeconomic thought of John Maynard Keynes in his book The General Theory of Employment, Interest and Money (1936) with neoclassical economics.

<span class="mw-page-title-main">Outline of economics</span>

The following outline is provided as an overview of and topical guide to economics:

<span class="mw-page-title-main">2008–2009 Keynesian resurgence</span> Great Recession-era revival of interest in aggregate demand-side economics

Following the global 2007–2008 financial crisis, there was a worldwide resurgence of interest in Keynesian economics among prominent economists and policy makers. This included discussions and implementation of economic policies in accordance with the recommendations made by John Maynard Keynes in response to the Great Depression of the 1930s, most especially fiscal stimulus and expansionary monetary policy.

<span class="mw-page-title-main">Lost Decades</span> Period of economic stagnation in Japan

The Lost Decades are a lengthy period of economic stagnation in Japan precipitated by the asset price bubble's collapse beginning in 1990. The singular term Lost Decade originally referred to the 1990s, but the 2000s and the 2010s have been included by commentators as the phenomenon continued.

John Howland Cochrane is an American economist who has served as the Rose-Marie and Jack Anderson Senior Fellow at the Hoover Institution since 2015. A specialist in financial economics and macroeconomics, he has been a professor of finance and economics by courtesy at the Stanford Graduate School of Business since 2016. From 1994 to 2015, he served as the AQR Capital Management Distinguished Service Professor of Finance at the University of Chicago Booth School of Business.

Richard Andreas Werner is a German banking and development economist who is a university professor at University of Winchester.

<i>The Return of Depression Economics and the Crisis of 2008</i> 2008 edition of 1999 book by Paul Krugman

The Return of Depression Economics and the Crisis of 2008 is a non-fiction book by American economist and Nobel Prize winner Paul Krugman, written in response to growing socio-political discourse on the return of economic conditions similar to The Great Depression. The book was first published in 1999 and later updated in 2008 following his Nobel Prize of Economics. The Return of Depression Economics uses Keynesian analysis of past economics crisis, drawing parallels between the 2008 financial crisis and the Great Depression. Krugman challenges orthodox economic notions of restricted government spending, deregulation of markets and the efficient market hypothesis. Krugman offers policy recommendations for the prevention of future financial crises and suggests that policymakers "relearn the lessons our grandfathers were taught by the Great Depression" and prop up spending and enable broader access to credit.

<span class="mw-page-title-main">Nicoletta Batini</span> Italian economist

Nicoletta Batini is an Italian economist, notable as a scholar of innovative monetary and fiscal policy practices. During the crisis she pioneered the IMF work exposing the dangers of excessive fiscal austerity and designed ways to consolidate public debt successfully during phases of financial deleveraging. Since 2003 at the International Monetary Fund, she has served as Advisor of the Bank of England's Monetary Policy Committee between 2000-2003 and was Professor of Economics at the University of Surrey (2007-2012), and Director of the International Economics and Policy office of the Department of the Treasury of Italy's Ministero dell’Economia e delle Finanze (MEF) between 2013-2015. Batini's fields of expertise include monetary policy, public finance, open economy macroeconomics, labor economics, energy and environmental economics, and economic modeling. She has handled extensive consultancy roles in the public sector in advanced and emerging market countries. She holds a Ph.D. in international finance from the Scuola Superiore S. Anna and a Ph.D. in monetary economics from the University of Oxford.

<span class="mw-page-title-main">Jagjit Chadha</span> British economist

Jagjit Singh Chadha (Punjabi: ਜਗਜੀਤ ਸਿੰਘ ਚਢਾ, born 1 December 1966 in West Yorkshire is a British economist who is the Director of the National Institute of Economic and Social Research.

Ronald Ian McKinnon was an applied economist. His primary interests were international economics and economic development, with strong secondary interests in transitional economies and fiscal federalism. Understanding financial institutions in general, and monetary institutions in particular, was central to his teaching and research, with interests ranging from the proper regulation of banks and financial markets in poorer countries to the historical evolution of global and regional monetary systems in the context of the world dollar standard.

The economic effects of Brexit were a major area of debate during and after the referendum on UK membership of the European Union. The majority of economists believe that Brexit has harmed the UK's economy and reduced its real per capita income in the long term, and the referendum itself damaged the economy. It is likely to produce a large decline in immigration from countries in the European Economic Area (EEA) to the UK, and poses challenges for British higher education and academic research.

References

  1. ↑ "Paul Sheard". Mossavar-Rahmani Center for Business and Government. Retrieved 1 July 2020.
  2. ↑ "Stocks". Bloomberg.com. 12 January 2018. Retrieved 14 January 2018.
  3. ↑ "Paul Sheard". World Economic Forum. Retrieved 14 January 2018.
  4. ↑ Noort, Jeff van den. "The Bretton Woods 2014 Conference - Delegates and Contributors - The Center for Financial Stability". www.centerforfinancialstability.org.
  5. ↑ "Paul Sheard - The Institute of International Finance". www.iif.com. Archived from the original on 31 December 2017. Retrieved 29 December 2017.
  6. ↑ "Session on subprime crisis held at BFA - Xinhua - English.news.cn". news.xinhuanet.com.
  7. ↑ "Global Conference 2016 - Speaker: Paul Sheard". www.milkeninstitute.org. Archived from the original on 31 December 2017. Retrieved 29 December 2017.
  8. ↑ Limited, Alamy. "Stock Photo - Boao, China's Hainan Province. 26th Mar, 2017. Paul Sheard, Executive VP & Chief Economist of S&P Global, speaks at the session of". Alamy.{{cite web}}: |last= has generic name (help)
  9. ↑ "Sheard: Will be interesting to see how President Trump remakes the Fed". CNBC. 21 November 2017.
  10. ↑ Source, CNBC US (21 November 2017). "Sheard: Will be interesting to see how President Trump remakes the Fed". CNBC. Retrieved 14 January 2018.
  11. ↑ "Paul Sheard - Latest & Breaking News on Paul Sheard - Photos, Videos, Breaking Stories and Articles on Paul Sheard". Moneycontrol. Retrieved 14 January 2018.
  12. ↑ Reuters Editorial (18 January 2017). "It's complicated! Don't view Brexit as hard or soft: S&P". U.S. Retrieved 14 January 2018.{{cite web}}: |author= has generic name (help)
  13. ↑ Coy, Peter (12 November 2013). "What Billionaire Ray Dalio Gets Wrong About Money". Bloomberg.com. Retrieved 14 January 2018.
  14. ↑ "Australia-Japan Research Centre |". Ajrc.crawford.anu.edu.au. Retrieved 7 May 2023.
  15. ↑ "Corporate and Investment Bank | Barclays". Investmentbank.barclays.com. Retrieved 7 May 2023.
  16. ↑ "RIETI - Research Institute of Economy, Trade and Industry". www.rieti.go.jp.
  17. ↑ “Auto production systems in Japan: organizational and locational features,” Australian Geographical Studies, 21(1), pp.46-68, 1983
  18. ↑ "Cross Holding".
  19. ↑ “Main banks and internal capital markets in Japan,” Shoken Keizai, 157, pp.255-285, 1986
  20. ↑ “The main bank system and corporate monitoring and control in Japan,” Journal of Economic Organization and Behavior, 11, pp.399-422, 1989
  21. ↑ “The Japanese general trading company as an aspect of interfirm risk-sharing,” Journal of the Japanese and International Economies, 3(3), pp.308-322, 1989
  22. ↑ “Long-termism and the Japanese firm,” in Mitsuaki Okabe (editor), The Structure of the Japanese Economy: Changes on the Domestic and International Fronts, Macmillan Press, pp.25-52, 1994
  23. ↑ “The economics of Japanese corporate organization and the ‘structural impediments’ debate,” Japanese Economic Studies, 19(4), pp.30-78, 1991
  24. ↑ “Keiretsu, competition, and market access,” in Edward M. Graham and J. David Richardson (editors), Global Competition Policies, Institute for International Economics, pp.501-546, 1997
  25. ↑ “The Japanese economy: where is it leading in the Asia Pacific?,” in Mari Pangestu and Ligang Song (editors), Japan’s future in East Asia and the Pacific: In honour of Professor Peter Drysdale, Asia Pacific Press, pp.1-30, 2007
  26. ↑ “Navigating historic times,” Standard & Poor’s Ratings Services Ratings Direct, Oct. 8, 2012
  27. ↑ Sheard, Paul (7 August 2014). "A QE Q&A: Everything You Ever Wanted To Know About Quantitative Easing" (PDF). Standard & Poor’s Ratings Services RatingsDirect.
  28. ↑ Sheard, Paul (13 August 2013). "Repeat After Me: Banks Cannot And Do Not "Lend Out" Reserves" (PDF). Standard & Poor’s Ratings Services RatingsDirect.
  29. ↑ "Standard & Poor's Explain Money Creation: "Banks Cannot and Do Not 'Lend Out' Reserves"". PositiveMoney. 17 August 2017.
  30. ↑ Sheard, Paul (17 August 2017). "QExit Q&A: Everything You Ever Wanted To Know About The Exit From Quantitative Easing" (PDF). Standard & Poor’s Ratings Services RatingsDirect.
  31. ↑ Stone, Amey (17 August 2017). "Investors Need Not Fear 'QExit,' But It Will Lead to Higher Rates". Baron's.
  32. ↑ “Time For Some Blue-Sky Thinking On The Future Of Macroeconomic Policy S&P Global Ratings RatingsDirect, March 24, 2016; “Helicopter Money And The Monetary Garden Of Eden,” S&P Global Ratings RatingsDirect, May 4, 2016
  33. ↑ "Rethinking Monetary Policy: Lessons And Reminders From the Great Financial Crisis," Standard & Poor's Ratings Services RatingsDirect, April 3, 2013
  34. ↑ Poljak, Vesna (8 July 2018). "Macroeconomics needs a reboot says economist Paul Sheard". Australian Financial Review.
  35. ↑ Sheard, Paul (2018). "Rethinking Macroeconomic Policy Frameworks" (PDF). Reinventing Bretton Woods Committee and Astana International Financial Centre.
  36. ↑ Sheard, Paul (29 April 2019). "It's Time to Rethink the Conventional Macroeconomic Framework". BrettonWoods@75 Blog.
  37. ↑ “Navigating Historic Times...With No Room For Error,” Standard & Poor’s Ratings Services RatingsDirect, Oct. 8, 2012
  38. ↑ Sheard, Paul (22 July 2016). "Brexit's Wake-Up Call to the EU: Selectively Sharing Sovereignty Is Not Sustainable" (PDF). S&P Global Ratings RatingsDirect.
  39. ↑ Sheard, Paul (25 July 2018). "Brexit is a wake-up call to the EU, but so far it is not being answered". Briefings for Brexit.
  40. ↑ “Japanese Reflation Is In Play, But Hurdles Galore Stand In The Way,” Standard & Poor’s Ratings Services RatingsDirect, Jan. 3, 2013
  41. ↑ "Change Of The Guard--And The Deflation Storyline--At The Bank of Japan,” Standard & Poor’s Ratings Services RatingsDirect, March 28, 2013
  42. ↑ Sheard, Paul (12 June 2013). "All You Need To Know About 'Abenomics'" (PDF). Standard & Poor’s Ratings Services RatingsDirect.
  43. ↑ Sheard, Paul (7 October 2016). "The Bank Of Japan Breaks New Ground Yet Again--And It May Work This Time" (PDF). S&P Global Ratings RatingsDirect.
  44. ↑ "Paul Sheard Alumni Profile". Monash University.
  45. ↑ "The Global Economy by 2020: Pressures and Prospects" (PDF). crawford.anu.edu.au.
  46. ↑ "The Institute of Australian Geographers". Iag.org.au. Retrieved 7 May 2023.
  47. ↑ Malcolm, J.P. (2013). Financial Globalization and the Opening of the Japanese Economy. Taylor & Francis. p. 379. ISBN   978-1-136-85502-3 . Retrieved 31 December 2017.
  48. ↑ "Advance.org". Advance The Global Australian Network.
  49. ↑ Delegates advance.org [ dead link ]
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.