Given the dollar’s global preeminence, perhaps it’s not surprising that half the dollar notes in circulation are outside the USA.


This is where the likes of Vietnam and the Philippines come in. Wages in Vietnam make China’s look almost munificent.


In 2016, high-tech enterprises accounted for almost 8% of India’s economy, and created some very rich individuals. Over half of India’s wealth belongs to just 1% of its people. Overall, India’s economy is more unequal than that of the USA, Russia and even China.


OPEC is supposed to meet regularly to coordinate production, thus keeping the oil price steady and delivering certainty and stability for its members. It does this mainly by trying to fix supply, as limiting supply should push the price higher. It sets “production targets,” which might mean ordering members to turn down the flow of oil to bolster prices when they’re low, and members are meant to agree to quotas and restrictions. But it doesn’t always work. In theory, as its largest member, Saudi Arabia dominates and should control OPEC, but the others are, on the whole, each significant enough to make a mark. Any individual member might decide to be selfish and ignore a pledge to cut output, something that’s even more likely if it suspects another member is doing the same. Since 1980, the vast majority of OPEC production quotas have been breached. In such a diverse and geographically spread group, suspicions, tensions and incentives to cheat are high.


But with the 1970s came change — both geopolitical, and to the workings of the market — and for the oil price that has spelt massive swings, a vertiginous, head-spinning rollercoaster ride. Since then, the price per barrel has dropped below $4 and it’s also spiked over $120. On the face of it, that’s a 30-fold increase. Of course, the standard cost of living has risen over time, too, but strip that out and the rise is more like 6-fold, which is still dramatic. This is something that affects every country — and every person — on the planet.


At that time, following the Bretton Woods agreement, which aimed to ensure global financial stability by making the dollar the backbone of the global economy, the greenback was the unit of international trade, widely available, and backed by gold. But there was not enough gold being mined to keep up with the number of dollars in circulation. The Bretton Woods agreement collapsed and the dollar’s position and reputation were in jeopardy.

To help re-establish the dollar’s global credibility, the USA made a deal with Saudi Arabia in 1973 to price and trade all petroleum products in dollars. So the dollar held on to its leading role in commerce, and its value was supported by the insatiable thirst for hydrocarbons. In return, the Saudis got America’s influence and backing to maintain security, particularly in holding Iran and Iraq at bay — a valuable development for them in such a volatile region.


The arms race continues, and conflicts have become an opportunity for Russia to market — and test — its firepower. As tension has increased in the Middle East in the 21st century, spending on arms in the region has doubled, and Russia is taking an ever-larger slice of the pie. In 2015, Russia intervened in the Syrian civil war in support of President Assad. The war became, as one headline put it, a “showroom for Russian arms sales,” as Assad’s troops demonstrated that firepower. The campaign cost Russia about $500M, but it’s estimated that it won about 10 times as much in increased sales internationally.


America’s wide-ranging powers aren’t just financial; it can also, for example, prosecute over emails that have been carried by an American internet server, something that internet giants such as Microsoft and Google have challenged.


Finance, industry and military armaments have always been linked, as the money and know-how required for arms development benefit industrial development, and vice versa.


It needed to take out some big foreign loans, and the biggest came from America, in dollars. Germany had been printing money during the war to pay for its military operations. After hostilities ceased, the wounded country struggled to produce the goods its citizens desperately needed. There was too much money chasing few goods. Germany’s currency, the mark, rapidly lost value as prices soared. A loaf of bread came to cost millions of marks, and tales are told of workers having to collect wages in wheelbarrows. The exchange rate plummeted as confidence in Germany evaporated. In 1914 the exchange rate was 4.2 German marks to the dollar; within a decade it was a 4.2 trillion marks.

In 1924 stability was finally restored through a combination of a coalition government, a new bank, the Reichsbank, and a new currency, the Reichsmark. The old money was burned. Then, in 1929, just as Germany was starting to enjoy better times, came the Wall Street Crash. American banks were quick to call in their loans. German banks didn’t have enough dollars (or rather the currency to buy them); some smaller institutions even collapsed. The economy slumped and unemployment rose dramatically, leading to protest and unrest. Against this backdrop of disillusionment, National Socialism — the Nazis — gained ground.


Germany and France alone make up over half of the Eurozone’s GDP.


Central banks usually set interest rates with the aim of fine-tuning the economy. At the beginning of the euro experiment, the ECB set interest rates in order to help the largest economy, Germany, which needed a boost, as it was suffering higher unemployment. A rate cut lowered German borrowing costs, put more money in the average German’s pocket, and made Germans more inclined to spend than to save. However, the rates were too low for the Irish economy, which needed to cool down. A rate cut there encouraged people to take on more credit and spend more. Borrowing in Ireland was growing at the fastest rate in the Eurozone, and fueled a growth spurt. The country was nicknamed the Celtic Tiger. High streets were awash with cash; retailers felt confident about putting up prices faster. Inflation rose. Mortgages were more affordable. A property boom ensured in Dublin. Boom tends to be followed by bust, as demand runs out of steam; Ireland ran true to form. 15 years on, unemployment in Ireland was higher than when it had joined the Eurozone.


They might have sought support from fellow members at this point, but Germany made it clear it wasn’t the responsibility of its taxpayers to bail out its struggling Eurozone relatives. Linked only by a common currency, the ailing PIGS were effectively left to their woes.

Fresh from one crisis, the guardians of global finance were wary of another one. So the IMF and the EU waived some of Greece’s debts and handed it some emergency cash. As with parents rescuing a recalcitrant teenager, the bailout came with strings attached. Greece was told it had to reduce its spending and get its house in order. Austerity measures included big cuts to pensions and public jobs, and hikes in tax. Already on the breadline, Greeks were outraged. Why shouldn’t Germany and its other richer neighbors foot more of the bill, be a bit more charitable and understanding? Why should hanging out in the big boys’ club mean playing by their tough rules? Greece objected to what it perceived as Germany being heavy-handed. Moreover, it was bristling that its richer counterpart may have been unfairly favored by EU policy. Rebelling against the cost-cutting its creditors were insisting on, Greece elected an anti-austerity government. The haggling over the cuts and handouts continued.

5 years on, Greek pensions have been cut a dozen times, resulting in a 40% drop in value. Families have borne the hardship. The economy remains wobbly and investors nervous.


The fortunes of the new EU clan vary considerably, and incomes in the newly arrived states of the former Eastern European bloc in particular tend to be much lower. An electrician in Germany earns 6 times as much as one in Romania. The cost of living is higher in Berlin in Bucharest, but only twice as high. The difference between those earnings and costs represents the standard of living. The possibility of a higher standard in Berlin could well be enough to tempt a Romanian electrician to pack his bags and his diploma and head west. He’d be one of the many European economic migrants gravitating towards the riches of Germany: in 2015, that was 685K people. Although many are sending a proportion of their new-found wealth back to their countries of origin, this brain drain has also left a skills deficit back home.


In 2015, Germany’s population was swelled by 1.1M asylum seekers, a third of them Syrian.

Merkel’s policy was labelled “the biggest foreign-policy mistake any Western leader has made since 1945.”


This pattern of migration is, of course, nothing new; people fleeing religious persecution in Britain in the 17th century appropriated the home of the dollar, the USA. The difference is that there is now a far greater number of people in the world protesting a right to a decent standard of living.


London is not just Europe’s financial capital; it’s the world’s. It’s handily located in the middle of the world’s time zones: 5 hours ahead of NY, 9 behind Japan. It’s English that’s the global business language — for now.

Money is the lubricant that enables the global economy to run smoothly, the fuel that keeps livelihoods on track. Managing it is huge business in the UK. Much of the world’s money converges on London, and has done through the city’s long and distinguished history.


It just goes to show that if money doesn’t move around the system, everything stops. If people are not willing to spend, trade and lend to each other, activity dries up and economic collapse is the likely outcome.

With fewer dollars circulating, incomes shrank and jobs were lost — especially as, across the West, consumers had previously been able to borrow to fund their spending. Recovery was painful.


Ultimately, Lauren’s wage is just the price someone is prepared to pay for her labor. And, like all prices, it comes down to supply and demand, which can vary according to what job she’s in and where she’s working; it can even decide whether she has a job at all.


Lauren may not feel a Silicon Valley CEO is worth a thousand of her, but the market begs to differ. The fierce competition for medical school or law school means that the average doctor or lawyer is much sought after and, in the USA, generously enumerated.


The share of GDP, the nation’s income, going to workers is lower today than it was 40 years ago. In 2016, the bosses of America’s biggest companies earned almost 300 times as much as their average employee. In 1965, that figure was just 20 times.