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Stiglitz on capitalism and its discontents

So it was fitting that the bank's former chief economist -- and biggest critic -- Joseph Stiglitz, would take to the pulpit of St. Paul's Cathedral in London's financial district to deliver a jeremiad excoriating global capitalism for its sins.

More than 800 people packed St. Paul's on a Friday evening in May to hear the 60-year-old Nobel Prize recipient expound the thesis of his latest book, Globalization and its Discontents. Stiglitz accused industrial countries of ignoring their policies' impact on others, citing as one example former Fed chief Paul Volcker's interest rate hikes. Stiglitz contends that they triggered the 1980s' Latin American debt crisis. He urged the World Bank and the IMF to shift financial risks toward richer countries.

Today, Stiglitz said, the U.S. is abusing its position as holder of the leading reserve currency to finance a growing current-account deficit with the world's savings. "We have not yet brought to the subject of finance an ethical perspective," he argued.

Stiglitz's newest project might merit a return to the pulpit: His next book, due out this fall, is tentatively titled The Roaring '90s.