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Blair Alum Talks Boom-Bust Dynamics in China on PBS Newshour In late January, Vikram Mansharamani ’92, PhD, was featured in a PBS Newshour segment that discussed the growing instability of China’s economy and its negative implications for the world. In the segment, Dr. Mansharamani, a global equity investor, Yale University lecturer and author of Boombustology: Spotting Financial Bubbles Before They Burst, argued that the Chinese economy is unsustainably inflated. As a result of over-investing to avoid economic decline, the nation has an excess of infrastructure, such as malls and office buildings, with no businesses to fill them or corresponding economic activity. “We see empty malls, empty ghost cities, excess real estate, millions and millions of units empty,” he told Paul Solman, the economics host of PBS Newshour.
But Chinese officials haven’t stopped creating new structures. “So we have got an example of a 7-yearold bridge with a 40-year use for life blown up and rebuilt. Why? Because you generate GDP credit for the explosives that you purchased, the construction crew that comes in to clean it up and the construction crew that builds the new bridge, the new steel and the new cement,” Dr. Mansharamani explained. At some point, China will stop the unnecessary building and transition its economy to be more sustainable and consumption-led. Dr. Mansharamani predicts other countries will suffer when construction slows in China, eliminating the demand that has recently boosted commodities and the economies of nations supplying the raw materials to the Chinese building boom. “As weird as that sounds, I actually think the pain will be felt outside [Chinese borders],” he concluded. To watch the interview in full, please visit www.pbs.org/newshour/bb/business/jan-june13/ makingsense_01-24.html.
CNBC Features Ty Schlobohm ’92 on Primetime Show ‘American Greed’ In late May, Arthur F. “Ty” Schlobohm IV ’92 was featured in an episode of CNBC’s primetime television show “American Greed.” The episode recounted the 2010 Ponzi scheme orchestrated by Trevor Cook, which Mr. Schlobohm helped the FBI to uncover. When he was approached about the “revolutionary” foreign currency trading deal, Mr. Schlobohm began researching the proposed agreement, which he quickly determined to be fraudulent. Upon learning about the operation, Mr. Schlobohm said he felt an obligation to reveal Mr. Cook and his dishonest actions. “‘This is on you, Ty. This is on you. Do something about it,’” he told CNBC in an interview for a “Bounty Hunters” news segment in 2011. Mr. Schlobohm also addressed the Society of Skeptics on the topic in February 2011. 54 Summer 2013
Posing as a major contributor to the fund, Mr. Schlobohm attended investor meetings while wearing a wire to record Mr. Cook and his partners’ actions. The information Mr. Schlobohm collected helped the FBI convict Mr. Cook for swindling more than 900 investors’ combined $190 million. Thanks in large part to Mr. Schlobohm’s whistleblowing, Mr. Cook was ultimately sentenced to 25 years in prison. The full episode of “American Greed” featuring Mr. Schlobohm is available for purchase on iTunes. To watch an episode trailer, go to www.cnbc.com/id/100754548.