Brad Setser, an economist at the Council on Foreign Relations, is the author of a new discussion paper looking at “the return of the East Asian savings glut”. A summary of his paper begins in arresting fashion with statistics:【G1】______________

Prior to the financial crisis, many economists fretted about the problem of global imbalances. Measurement error aside, global trade balances; surpluses in some countries offset deficits in others.

Why do such imbalances matter? They can create problems in a few ways. Large surpluses can be a side effect of very high savings rates, for example. The large imbalances of the 2000s seemed to reflect unnaturally high savings, which contributed to a “global savings glut” that depressed interest rates and encouraged reckless borrowing.【G2】_______________These sorts of problems still apply in some circumstances.

Yet another worry has grown more salient in the post-crisis period: the demand drain imposed on the global economy by surplus countries. A rising surplus in one country implies a rising deficit in another. That deficit represents a demand drain; spending that might otherwise have taken place within the economy flowing abroad into another economy.【G3】____________However, when interest rates are near zero and political constraints prevent governments from using active fiscal policy, the demand drain is dangerous: it generally results in weaker demand, and slower growth.

Imbalances today look slightly different than they did a decade ago. Then, America accounted for nearly all of the global deficit, while oil-exporting economies were responsible for most of the surplus. Oil balances are less important now, since America produces much more oil domestically than it used to, and since global oil prices have fallen. Instead, the surplus countries are high-saving goods exporters in Europe and East Asia. The big deficit economies, somewhat strikingly, are now America, Australia,

Britain and Canada.【G4】_____________The split is a weird one which deserves more investigation.

The tricky matter is to work out what will happen next to global imbalances. Mr Setser notes that East Asian surpluses are rising partly because rates of domestic saving are high, but also because investment rates in countries like Korea have been falling.【G5】__________Depending on how Brexit unfolds, Britain, which had been a rather generous contributor to global demand thanks to its whopping current-account deficit, might find itself pushed rather roughly by financial reality toward a more balanced current account—as the tumbling pound forces Britons to cut back on imports, for example.

[A] These economies are all of a type: English-speaking, of course. Rich. But they are also highly financialised economies which specialise in the export of high-value services and safe assets, in the form of both government securities and land.

[B] Large imbalances can be unhealthy for countries on both sides of the zero; the deficit countries consuming more than they produce risk accumulating unmanageably high debts, while surplus countries can suffer from economic distortions associated with the policies that boost net exports.

[C] After shrinking dramatically during the crisis and global recession, the imbalances have begun to rebound and are now back to about 1.5% of GDP.

[D] These countries do suggest a growing vulnerability across the global economy to any future shocks to demand, from excessively rapid increases in American interest rates, for instance.

[E] The combined savings of China, Japan, Korea and Singapore is about 40 percent of their collective GDP, a thirty-five-year high.

[F] Meanwhile, Japan continues to run a rather large budget deficit; were it not for that, its current-account surplus would likely be larger. And in Europe, recovery has been built atop large and growing current-account surpluses.

[G] It is not a terribly big deal when the deficit economy can easily use monetary or fiscal policy to step on the accelerator and boost domestic spending: from the government, for instance, or through increased domestic investment.

As a species, humans are incredibly smart. Our intelligence comes with a curious caveat: our babies are among the dumbest—or, rather, the most helpless—that exist. A baby giraffe can stand within an hour of birth, and can even potentially flee predators on its first day of life. A monkey can grasp its mother and hang on for protection and nourishment. A human infant can’t even hold up its own head.

However, as Kidd and Piantadosi argue in their new paper, published in a June issue of PNAS, hu-mans become so intelligent because human infants are so incredibly helpless; the one necessitates the other. The theory is startling, but it isn’t entirely new. Researchers have been pondering the peculiarities of our birth and its evolutionary significance for quite some time. Humans belong to the subset of mammals, called viviparous mammals, that give live birth to their young. This means that infants must grow to a mature enough state inside the body to be born, but they can’t be so big that they are unable to come out.【G1】_____________The brain, therefore, must keep maturing, and the head must continue growing, long after birth. The more intelligent an animal will eventually be, the more relatively immature its brain is at birth.

Researchers have long known about this trade-off, and about the connection between brain size and neural density and intelligence.【G2】_________________

Kidd and Piantadosi’s new idea is that increased helplessness in newborns mandates increased intelligence in parents—and that a runaway selection dynamic can account for both. Natural selection favors humans with large brains, because those humans tend to be smarter.【G3】__________

During their investigation, Kidd and Piantadosi realized something important that strengthened their theory. It turns out that another variable has an even higher correlation with intelligence than brain size—time to maturity, or weaning time.【G4】___________________Orangutans have smarter babies than baboons and they wean them longer. Baboon babies, in turn, are weaned longer, and are smarter, than lemur babies.

Putting these facts together helped Kidd and Piantadosi develop their hypothesis. The connection be-tween head size and intelligence does create incentives for babies to arrive earlier. But it’s the connection between weaning time and intelligence that may really be driving the cycle.【G5】__________________And so the cycle continues.

[A] As we grew smarter, we were better able to take care of our infants, so they could be born more helpless and allow us to grow even smarter. This is why the cycle happens to humans and not to lemurs.

[B] You need to be smarter to care for more helpless creatures, which means you need a larger brain— which means that babies have to enter the world at an even more helpless stage of development, since there is a finite size to their brain at birth, mandated by the physiology of live birth.

[C] In other words, the time it takes to shepherd newborns through absolute helplessness to a point of relative self-sufficiency predicts primate intelligence more strongly than the best measure that has previously been proposed, namely, head circumference.

[D] For instance, Robin Dunbar found that the ratio of neocortical volume to brain size can predict the social-group size in a number of species, including bats, cetaceans, and primates, while Simon Read-er has demonstrated links in tool use and innovation to brain size in primates.

[E] This may create evolutionary incentives for babies that are born at an even earlier developmental stage, which require more intelligence to raise. This creates the dynamic: over time, helpless babies make parents more intelligent, which makes babies more helpless, which makes their parents more intelligent, and so on.

[F] This leads to a trade-off: the more intelligent an animal is, the larger its head generally is, but the birth canal imposes an upper limit on just how large that head can be before it gets stuck.

[G] This is a contradiction. Humans are born quite helpless, far more so than any other primate, but, fairly early on, we start becoming quite smart, again far more so than any other primate.

We have come to think of teenagers as a breed apart—ask any parent of one. But as a driver of culture, as a consumer niche, as a state of contrariness, the subspecies known as teenager wasn’t even identified until World War II, the point at which British music writer Jon Savage’s fascinating new book, Teenage: The Creation of Youth Culture 1875-1945, ends.【G1】___________

Amid the chaos of mass urbanization in the late 19th century, teens were already notoriously drawn to trouble. The street gangs that carved up New York City back then were fueled by crime, but many members joined primarily for the sake of the fringe benefits—access to the forbidden pleasures of drink, drugs and sex.【G2】_______________________For example, the Parisian gangsters of that era—known as Apaches—wore silk scarves and, writes Savage, “an air of bourgeois arrogance.” In England’s inner cities, where there were regular pitched battles between gangs, the look was edgier. A youth worker in the 1890s noted that a proper Manchester “scuttler” could be identified by a loose white scarf, plastered-down hair, bell-bottom trousers.

In 1898, G. Stanley Hall, an American psychology pioneer, defined a new stage of life called “adolescence,” characterized by parental conflict, moodiness and risk taking. Contrary to the disciplinarian ethos of the day, Hall recommended that adolescents be given “room to be lazy.” His prediction that “we shall one day attract the youth of the world by our unequaled liberty and opportunity,” not only prophesied a culture that would revere youth but also patented it as American.

【G3】______________The view of a German lieutenant colonel, Baron Col-mar von der Goltz, in 1883 that “the strength of a nation lies in its youth,” was pretty much shared by all the muscle-flexing European powers of that era. World War I ultimately spent the lives of as many as 3 million of Europe’s adolescents, and the pangs were felt for decades. “The Great War,” Savage writes, “forever destroyed the automatic obedience that elders expected from their children.”

In the Europe of the 1920s, that generational dissent was mostly expressed either in the arts (Jean Cocteau, Fritz Lang, Aldous Huxley) or in outright decadence.【G4】_________Nowhere more so than in Germany, where the Wandervogel, a popular, free-spirited, back-to-nature youth movement whose non-political ideals had survived World War I, found itself lujacked in the 1930s by the Hitler Youth. By 1939, membership of the Hitler Youth stood at 8.9 million.

【G5】________________The self-styled Swing Kids of Hamburg and the Zazous of Paris paid a heavy price in beatings and scalpings for growing their hair, wearing Zoot suits, and dirty dancing to banned jazz. “Instead of uniformity, they proclaimed difference; instead of aggression, overt sexuality,” writes Savage, with as good a recipe as any for the teenage era that was about to dawn.

Teenage is a bracing reminder that the tides of teen rebellion after 1945 were always about more than loud music and fashion. That story has often been told, not least by Savage in his 1991 history of punk, England’s Dreaming.

[A] His prediction was proved right. But in Europe, any such optimism was overwhelmed by a half-century of war and talk of war.

[B] Despite the clamps on freedom during the first years of World War II, the pockets of youthful defiance that Savage describes in Germany and occupied France showed a daring contempt for fascist authority, expressing it to the beat of American pop culture.

[C] But caught up in a renewed spiral to war, youths, many of them jobless, were soon being courted by political groups on the left and right.

[D] His 576-page trawl through the social commentary, memoirs and report of Europe and the U.S. in those decades shows how all the indicators of modern youth culture—the generational antagonism, the moral panics, the idealism, the shocking dress sense—were in place long before teenagers made a name for themselves.

[E] What’s yet to be accounted for is the curious disappearance in recent years of the generation gap between teens and their elders.

[F] And then, as ever since, young toughs also had an eye to fashion.

[G] Poverty and lack of education were recognized early on as the root problem of these disaffected youths.

[A] The person-skills match approach to selection

[B] The impacts of bad selection decisions

[C] The importance of structured interviews

[D] Demographic changes in Europe

[E] The person-environment fit

[F] The unstructured interview and its validity

[G] The birth rate in Europe

Usually, organisations fail because of undercapitalisation, poor financial management, and adverse market conditions etc. Yet, organisations with sound financial backing, good product ideas and market awareness often underperform. Therefore, a more complete explanation of “what went wrong” must consider the essence of what an organisation is and that the most important and often the most expensive financial input is people.

【G1】____________________________________________________

An organisation is only as good as the people it employs. Selecting the right person for the job involves identifying the essential or desirable range of skills, educational and professional qualifications necessary to perform the job and then recruiting the candidate who is most likely to possess these skills or at least is perceived to have the ability and predisposition to acquire them.

【G2】_______________________________________________

Work invariably takes place in the presence or under the direction of others, in a particular organisational setting. The individual has to “fit” in with the work environment, with other employees, with the organisational climate, style of work, culture of the organisation. Different organisations have different cultures.

【G3】_______________________________________________

Poor selection decisions are expensive. For example, employing an unsuitable technician on an oil rig or a nuclear plant could, in an emergency, result in millions of pounds of damage or loss of life. Hiring a wrong person may result in low job satisfaction, lack of organisational commitment and employee stress, which affect organizational outcomes.

【G4】_______________________________________________

However, despite the importance of the recruitment decision and more objective selection techniques available, many organisations are still prepared to make this decision on the basis of a single 30- to 45-minute unstructured interview. Indeed, research has shown that a selection decision is often made within the first four minutes of the interview. In the remaining time, the interviewer then attends exclusively to information that reinforces the initial “accept” or “reject” decision. Research into the efficiency of selec-tion methods has consistently demonstrated that the unstructured interview, where the interviewer asks any questions he or she likes, is a poor predictor of future job performance and fares little better than more controversial methods like graphology and astrology.

【G5】______________________________________________

The future, we are told, is likely to be different. Detailed surveys of social and economic trends of the European Community show that Europe’s population is falling and getting older. The birth rate in the Community is now only three quarters of the level needed to ensure replacement of the existing population. By the year 2020, it is predicted that more than one in four Europeans will be aged 60 or more and barely one in five will be under 20. The changing demographics will not only affect selection ratios. They will also make it increasingly important for organisations wishing to maintain their competitive edge to be more responsive and accommodating to the changing needs of their workforce if they are to retain and develop their human resources. More flexible working hours, the opportunity to work from home or job share, the provision of childcare facilities etc., will play a major role in attracting and retaining staff in the future.

[A] It turns out that unemployed youth with the most education in high-income economies have worse physical well-being than those with less education. Unemployed youth with college degrees have the lowest physical well-being, followed by those with secondary education, and then primary education. So not only is there something unique about youth unemployment in high-income economies, but there is also something unique about educational attainment levels within them. So what might explain these counterintuitive and troubling findings?

[B] We know a lot about the devastating health effects of unemployment. But new analysis reveals just how bad it can be for unemployed youth in high-income countries. Our Gallup-Healthways Global Weil-Being Index found that among 47 high-income countries, the physical well-being of unemployed young adults between the ages of 15 to 29 is statistically tied with employed people aged 50 and older. And in the U.S., where we were able to analyze a sufficient sample size, unemployed youth have a worse physical well-being compared with employed older adults. The same phenomenon is not observed in many lower-income to upper-middle-income economies, where unemployed youth on average enjoy higher physical well-being compared with employed older adults. In other words, these findings are unique to unemployed young people in many highly developed economies.

[C] Seeing such a low percentage of young people who are thriving in their physical well-being relative to others cries out for action. Much attention has been dedicated to the problem of youth unemployment in developing countries (for good reason), but it is clearly a problem for high-income countries as well. And in high-income countries—where unemployed youth may suffer from stigmas and lack family support—it raises important questions about how best to serve them and help them find meaningful work.

[D] Second, unemployment may be harder to bear when family support is absent. Take three reference points: India, Mexico, and the U.S. In India, the vast majority of Generation-program students are living with several members in their households. U.S. youth, on the other hand, are often on their own. Mexico is a middle point between the two. For reference, Mexico and India, when viewed as part of upper-middle-income and lower-middle-income economies, tend to have higher percentages of thriving among young unemployed adults.

[E] What’s the cause? A quick answer would be that many of these young adults were in poor physical well-being to begin with, preventing them from working. This is possible. But our analysis also leads to some other viable explanations. Could the stigma of not having a job as a young person in a highly developed economy be devastating enough that it is similar to adding 30 years of aging to one’s physical well-being?

[F] For answers, we turned to McKinsey Social Initiative’s Generation, a youth employment program that is active in five countries spanning various income levels: the U.S., Spain, Mexico, India and Kenya, It has supported more than 8,000 youth across these geographies in the past 20 months, and its data and experiences yield two hypotheses that may explain why these outcomes are so prevalent in the United States specifically.

[G] First, sharing the burden with a peer group lessens the health effects of unemployment. In Spain, youth unemployment rates had reached more than 50% two years ago and remain upward of 40%. In spite of this massive rate, the physical well-being of unemployed Spanish youth is higher than that of unemployed youth in the U.S., where youth unemployment rates were between 11% to 12% in July this year. We hypothesize that U.S. youth who are unemployed could be suffering lower physical well-being than their counterparts because they are an anomaly in a high-employment economy and therefore bear a higher individual cost.

【G1】→E→【G2】→【G3】→【G4】→【G5】→C

[A] One of the reasons making air cleaner can have so immediate an effect is that even a little dirt can do a lot of damage. A reduction of just 10 micrograms of pollution per cubic meter of air—a degree of improvement many of the surveyed cities were able to attain during the two-decade-plus period— could extend human life-spans a full nine months. How small is 10 micrograms per cubic meter? Consider that simply by living with a cigarette smoker, you’re exposed to a daily dose of 20 to 30.

[B] As with so many other things, President Barack Obama’s coming into power has people hoping that these kinds of questions will be more aggressively addressed than they were over the past eight years. Even during the most heated days of the fall campaign, neither candidate went so far as to promise longer life in exchange for a vote. But a smart environmental policy could deliver just that.

[C] The benefits of cleaner air may even be felt in towns whose skies weren’t that dirty to begin with. Those that began with the very lowest levels still saw health benefits from small improvements. The evidence isn’t yet there to determine whether those benefits would continue growing until the fine-particle pollution got down to zero; one of the cities closest to that, Albuquerque, New Mexico, still hovers around 5 micrograms per cubic meter. But at this point, it doesn’t seem that the benefits decrease. “If it continues to follow what we’ve observed, it appears that there are health benefits down to very low levels of exposure,” says Dr. Pope, the study’s lead author.

[D] Nobody pretends that polluted air isn’t terrible for your health. Clean up the skies over any dirty city, and the people who live there will all but certainly become healthier. That, at least, has been popular wisdom, but until now, no one had ever put it to a statistical test. Now someone has, and the results are striking: according to a study just published, when local governments decide to remove the smog, local residents actually live an average of five months longer.

[E] Pittsburgh, Pennsylvania, for example, is one city in the survey that was at the 30-microgram level before the decline of the steel industry in the 1980s drove the dirt out of the skies—even as it drove jobs out of town. Pittsburgh was one of the biggest winners in the new study, with residents gaining roughly 10 months in life expectancy over what they had when the mills were still churning.

[F] The next step for both researchers and policymakers is determining which sources of dirt—power plants, motor vehicles, other industrial polluters—make the biggest contributions to particle levels and thus should be most aggressively targeted. “In a difficult economic situation,” asks Dr. Douglas Dockery, “where can we spend the dollars that would have the most benefit?”

[G] In order to reach so precise a finding, the study’s authors had to do some exhaustive number-crunching, surveying pollution rates and longevity in 51 cities across the U.S. over a 21-year period from 1979 to 2000. Overall, they found that lifespan in all of the areas increased by an average of nearly three years—from 74 to 77—as a result of a host of factors, most notably reduced smoking and improved income. But 15% of the change was attributable to cleaner air.

D→【G1】→【G2】→【G3】→【G4】→【G5】→B