5 Questions With Stephen Roach
Stephen Roach, non-executive Chairman of Morgan Stanley Asia, is also a member of the faculty of Yale University. Roach is widely regarded as one of Wall Street's most influential thought leaders and has presented expert testimony to the U.S. Congress. His research focuses on globalization, the emergence of China and India, and the capital market implications of global imbalances.
Q: How did you get started in this business?
A: I did my PhD in the early '70s, joined the Fed in '73 and have been in the business ever since.
Q: What was the biggest victory in your career?
A: That I was among the first to discover China for what it is, and envisaged Asia to be the global power it is.
Q: What lessons did you learn during the Asian Financial Crisis that can be applied today?
A: That imbalances matter. Asia lacked foreign exchange reserves, had current account deficits and was vulnerable to capital outflows. The crisis saw Asia took aggressive measures to protect itself and this has been accomplished.
Q: Who has been the biggest influence in your life?
My personal hero is Paul Volcker, the courageous central banker who dealt with inflation.
Another is China — I have deep respect for Chinese leaders of the last 30 years. China has been nothing short of a miracle.
Q: What keeps you awake at night?
The sad state of U.S. economic policy. With issues ranging from low interest rates, trillion-dollar stimulus, unemployment and under-employment, the U.S. economy is mis-managed in a way I have never seen before. I am worried at the state of things and worried for my children.