by Daniel Costello

Not everyone likes historian Niall Ferguson . I get it. Saying the Harvard prof is a self-promoter is like saying Hank "King Henry" Paulson appears a bit unsure of how to deal with the financial crisis this week. There's understatement and then there's understatement.

Despite that, I'm a fan. One plug: "The War of the World: Twentieth Century Conflict and the Descent of the West" is a really good book.

Here's his historical take on the recent economic downturn in Vanity Fair this month.

Here's another exploring whether the current financial crisis means the global balance of power is shifting for good. In short, it looks at whether the relationship between China and America - ok, a term he annoyingly termed as "Chimerica" several years ago — is likely to move in China's favor.

 

Some onlookers think the two co-dependent economies, which accounted for nearly half the world's economic growth this decade, may begin to move apart as China relies less on exports to America and cares less about the yuan's peg to the dollar. More decoupled from the U.S., China could foster even stronger relationships with Russia, Europe and other regional Asian economies.

From Ferguson:

Already "China was projected to overtake the United States in gross domestic product in 2040. But in more recent reports, that has been brought forward to 2027. Maybe it will be even sooner. For one inevitable consequence of the credit crunch is that the United States will grow more slowly for the foreseeable future — at closer to 1 or 2 percent per year, rather than the 3 or 4 percent it has grown used to. By contrast, China's semi-planned economy can comfortably maintain growth of 8 percent or more per year, propelled forward by state-led investment in infrastructure and growing."

Now time for some caveats: people have pegged the downfall of the U.S.'s political-economy before and have walked away filled with egg on their face.

According to the Morgan Stanley Capital International index, the U.S. stock market is down around 18 percent to date this year. The equivalent figure for China is 48 percent, and for Russia — the worst affected of the world's emerging markets — it is 55 percent. These figures are not very good advertisements for the more regulated, state-led economic models favored in Beijing and Moscow.

Does Wall Street's meltdown presage the end of the American century? Not likely. Hysteria can often lead people to make some pretty silly predictions. Still... guess we'll just have to stay tuned.