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Hedge strategies became famous after the strange year of 2008 when Lehman Brothers went bankrupt and the Norwegian stock market crashed by 55%. Countries could benefit from the hedging strategies known from the financial world during an era when the American hegemony is about to end. In a polar or bipolar world where stakes are well known hedging is unnecessary, but in a multipolar world dominated from two to ten states the importance of hedging increases. A successful foreign policy hedging strategy aims at finding a low delta by reducing and managing risk, pushing decision making into the future, keeping options open and developing insurance mechanisms. L. Pitkaniemi

Explains that the late-2000 recession was mainly due to the fact that politicians, businessmen and economists had forgotten the lessons of the great depression resulting in a moral hazard of overleveraging as big corporations knew that the government would bail them out. The seeds for this economic crisis were already sawn by the stock market bubble in the 1990's that eventually spread into more important sectors due to bad government policies based on neoliberalism. It is important that policy makers see the economic crisis as a possibility and aim at full employment while redesigning the credit system in order to avoid future crises. L. Pitkaniemi

Discusses what problems were present in the world economy on a macro and a micro level, how it resulted in the financial crisis and how the authorities were trying to intervene in order to stabilize the situation. On the macroeconomic level Americans bought cheep Asian goods while printing a lot of money, but inflation was kept at bay since the money was sent to Asia. The circle was complete when Americans lent the money back from Asia and speculated with it. On the microeconomic level structured investment vehicles (SIVs) and asset backed commercial paper (ABCP) created problems especially when they were combined with collateralized debt obligations (CDOs) and mortgage-backed securities (MBS). The boom turned into bust after 2006 when there were not enough house buyers left. L. Pitkaniemi