Although the global financial crisis of 2008 wreaked havoc on the economies and governments of countries worldwide, it did not cause many scholars to reassess long-held beliefs concerning finance, economics, and international relations, the story says. For Katzenstein, the events that led to the financial crisis caused him to look again at important aspects in world politics. Eventually, this helped him develop a new conceptualization of power in world politics.
Events began with the American brokerage company Bear Stearns on the brink of collapse in the spring of 2008. The Monday after Bear Stearns’ bailout by JP Morgan and the Federal Reserve Bank of New York, Katzenstein found himself reminded of Black Monday 1929, when the United States financial markets crashed and much of the rest of the world followed. Growing up in Germany, Katzenstein was very aware of the financial and political disaster that befell Germany in the wake of those events. “I walked into class and told my students I never thought I would experience a Black Monday in my life time,” he remembers. “Bad things are bound to follow.”
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