Stephen Roach ’68

2011 Distinguished Alumni Award Honoree

Stephen Roach: Then and NowAs one of Wall Street’s most influential economists, Stephen Roach ’68 knows a thing or two about good investments. He has recently put this knowledge to good use with a teaching position at Yale University, where he is developing new curricula on Asia and macroeconomic policy.

Roach has spent the bulk of his career as chief economist at Morgan Stanley, and more recently, as chairman of the firm’s Asian businesses, including a three-year stint in Hong Kong. A prolific writer and communicator on the global economy, he welcomes the challenge of being back in a college classroom.

A California native, Roach enrolled at UW-Madison in Fall 1963, with aspirations of becoming a civil engineer. “It was sort of serendipitous,” he said. “I simply did not want to follow my friends who went to one of the California campuses. I wanted to go as far as my parents would let me and still pay for my education. Wisconsin was the place, but it wasn’t a well-thought out and informed decision.”

It took him more than a year to figure out that engineering was not his calling. “My third semester was not a high point of my time at Madison,” Roach recalled. “I was halfway through when I dropped everything and took a job checking coats at the alumni center.”

He transferred to the College of Letters and Science and explored several majors before landing on economics. “I quickly became aware of the great tradition of economics at Madison and loved being part of it,” he said.

“Now I am a teacher — bringing it all full circle. That makes me deeply mindful in this great university and committed to giving something back in return.”

His Wisconsin experience was also deeply influenced by happenings on the world stage. “Madison itself was going through a massive transformation, and it certainly changed my life,” he said. “When I showed up in 1963, Madison was the quintessential football school. I joined a fraternity [Alpha Epsilon Pi] and the emphasis was on social life. When I left in 1968, the character of the campus had changed with demonstrations of protest and dissent over the Vietnam War.”

After graduating from UW, Roach enrolled at New York University, where he earned his master’s and doctoral degrees in economics. He served on the research staff of the Federal Reserve Board and was a research fellow at the Brookings Institution before joining Morgan Stanley in 1982.

Roach’s current research and writings on globalization, the emergence of China, productivity and the macroeconomics impacts of information technology have appeared in academic journals, books, and congressional testimony and on op-ed pages of the Financial Times, the New York Times, the Washington Post and the Wall Street Journal. His opinions on the global economy have helped shape the policy debate from Beijing to Washington.

His latest book, The Next Asia, was named the 2009 Book of the Year by China Business News — China’s equivalent of the Wall Street Journal.

While working in Hong Kong, Roach had the opportunity to co-teach a course at Yale and discovered a new passion. In 2010, he jumped at the opportunity to join the faculty of Yale University as a senior fellow and senior lecturer, with a joint appointment at the Jackson Institute for Global Affairs and the School of Management. He will also continue his 28-year career with Morgan Stanley in Asia and other parts of the world.

“I was deeply involved in academia until age 28, and I thought I wanted to be a teacher when I was getting my PhD,” Roach said. “But I ended up working for the Federal Reserve Board and on to Wall Street. So it never panned out. However, in the back of my mind, I always had the flame burning that I might want to teach someday if the situation arose.”

Last fall, he launched his first course on the Chinese economy, The Next China. “I always heard teaching was a lot of work, and it ended up being many multiples of what I anticipated,” he said.

At age 65, Roach says he’ll never retire. “There are too many exciting and fun things to do that I have great passion for,” he said. “I spent 30 years on Wall Street and that was fantastic. And now, being able to be part of a great university and teach and work with young people — it’s immensely exciting and satisfying.”

In Appreciation

I came to Madison in the Age of Innocence. It was the fall of 1963, and the University of Wisconsin was a classic Big Ten football school. For the first half of the season, the Badgers were undefeated and ranked #1 in the national polls. Nothing else really seemed to matter.

That innocence was quickly shattered by the gunshots of Dallas in November of that same fateful year. A young president was dead and the hopes and dreams of a generation of college students were in tatters. Little did we know at the time that the assassination of John F. Kennedy marked the beginning of one of America’s most tumultuous periods of social and political unrest. And Madison, of course, was right in the eye of this storm.

Over the relatively short span of four years, the college experience was turned inside out. When I left Madison in early 1968, the stinging aroma of tear gas was still in the air. Anti-war demonstrations had erupted with a vengeance in late 1967. A once-idyllic campus was in turmoil. Students and faculty, alike, came together in questioning and ultimately challenging many of America’s core value propositions. The innocence of a freshman had vanished into thin air.

In the midst of such turmoil, it is next to impossible to get a real sense of perspective. Only with the benefit of hindsight have the tectonic shifts that occurred during my four years plus in Madison come into sharper focus. It was certainly my wake-up call. I became less focused on “what” and more interested in “why.”

As difficult a period as this was — for the university community as well as for our nation — there were many silver linings. At the top of my list was the personal awakening of a deep sense of intellectual and academic curiosity. The football season and Greek life faded quickly into the background. I suddenly discovered I had a burning desire to learn. The time-honored Wisconsin economics tradition came alive for me — and set me on the path to graduate school, a doctorate, and a long career as a Wall Street economist.

And now I am a teacher — bringing it all full circle. That makes me deeply mindful of my roots in this great university and committed to giving something back in return. All I can offer are the lessons of my own journey. While the world today is a very different place than it was in the 1960s, some things never change. The current generation of students is facing its own loss of innocence. Sure, the context, the issues and the pressures are very different. But that doesn’t minimize the tough transitions and difficult choices that lie ahead — to say nothing of the self-discovery that will be required to meet these challenges head on.

I strongly believe that my generation has a responsibility to draw on our collective experiences in helping today’s students find the way. For those of us who were privileged to attend the University of Wisconsin in the 1960s, it would be a real pity if we squandered the searing memories of those extraordinary days in Madison. To me, there is no greater lesson to pass on than that wake-up call of 45 years ago.

Related Links:

Honored Economist Builds on Wisconsin Roots