A central banker has two lives: the first is spent studying neoclassical money supply mechanics; the second begins when they realize the real world doesn’t work that way. If Warsh has not entered the second phase, he soon will, since he’s been tasked with the impossible: to helm a machine that requires no operator.

There is a recurring temptation in political economy to reduce social order to a problem of conflict. If human interests are not perfectly aligned, the argument goes, stability must rest on mechanisms that prevent clashes, enforce boundaries, and ensure compliance with rules, especially those governing property. This view—while internally consistent—overlooks a more fundamental insight: social coordination does not depend on the absence of conflict, but on individuals adjusting their plans within a framework of dispersed knowledge.

While reading The Wealth of Shadows—Graham Moore’s excellent historical novel about pre-World War II global finance—I couldn’t help but feel a growing sense of unease regarding the current state of international economics.