The Grandmaster Who Gave Up Chess (Mostly) To Shape Global Economics

Ken Rogoff is a very hard person to pin down. He's both a GM and has a doctorate in economics. He's drawn Magnus Carlsen, Mikhail Tal, and Tigran Petrosian, yet he is better known as the former Chief Economist of the International Monetary Fund.

He once received very high praise from Bobby Fischer. He has met world leaders, including Angela Merkel, who also plays chess—yet didn't know he was a grandmaster. He still loves chess and follows it incessantly, yet he claims to have played fewer than five complete games of any kind since his retirement in 1980 (one of those games was against a six-year-old, and another was a draw against Magnus Carlsen!).

Rogoff is a classic case of the "chess bug" never fully leaving any of us. In his new book, Our Dollar, Your Problem, the Harvard professor makes the case that the U.S. dollar will not be the world's reserve currency forever, yet he weaves in chess references nearly every chapter.

While you could be tempted to skip straight to the index to see on what page he discusses his fascinating 2003 meeting with Arkady Dvorkovich (a full 15 years before Dvorkovich became FIDE president), the book itself is an insightful journey into monetary policy and Rogoff's peripatetic double careers. While he insists it is not a memoir, there's a healthy mix of financial wonkiness and chess anecdotes to please a wide array of readers.

Chess.com spoke with Rogoff and discussed his formative chess years as a teenager in the Balkans, how that influenced his world view today, and what position Dvorkovich had set up on his chess board for that prescient meeting. Given his preeminence in the economics world, the interview also ends with a quick foray into straight financial questions.

The full video interview is below. We've also printed out several questions and answers below, editing some for space and clarity.

Chess.com: Chess.com is pleased to be here with grandmaster Ken Rogoff. He did his undergraduate and graduate at Yale, his PhD from MIT, and he's currently a professor of economics at Harvard, and is a former chief economist of the International Monetary Fund.

But what you want to know is that he's the former U.S. Junior Champion, and he's drawn games with luminaries like Petrosian, Tal, and even Magnus. But his third book comes out this month: Our Dollar, Your Problem. Here it is. I've got my advance copy, which centers around the U.S. dollar's dominance in the international economy.

Ken, thank you for joining us.

Rogoff: Thank you for having me. I'm a big fan of Chess.com—not that I'm playing, not under a pseudonym, nothing. But I'm just excited about how well it's doing. I love chess and I want to see its popularity grow. You've done a lot for that.

Chess.com: Absolutely, chess is doing well, and we've got a lot of chess experiences to talk about with you today. We're going to travel all the way back to your formative years, when you lived in the former Yugoslavia. You saw the effects of the economy in Belgrade, Zagreb, and Sarajevo. And I'm wondering, did some of those experiences in your European travels help convince you to become an economist or shape your views on the economy?

Rogoff: Well, it might have shaped me as an economist, but it was a very tortured decision not to play chess. I think it was quite unusual in my age group to really give it up. The truth is, I was a teenager. I lived between London, Spain, and the former Yugoslavia, especially in Sarajevo. I was also in Zagreb and Belgrade. I loved chess. I was absolutely passionate about it.

You know, I decided to go to college. I played full-time in the summers. I did nothing else. During the year, I just followed it. I didn't play. But yeah, it was a very difficult decision to give it up. But definitely it influenced me as an economist. Chess influences me to start with. I don't want to try to unpack it all in one phrase. But one thing that's kind of hard for your generation to get your head wrapped around—I don't think anybody had an idea of quite how much the Soviet bloc was going to implode. I don't think anybody knew that, trust me, the White House didn't know it, the CIA didn't know. And when I went to Yale as an undergraduate, let me tell you, the professors didn't know. We were taught it was doing great...

Chess.com: Well, you also mentioned in the book that you were a guest commentator for the Fischer-Spassky match in 1972. I did not know that. Take us a little inside that time. Did the match feel historic when it was happening? Were the geopolitical overtones obvious in the moment?

Rogoff: There's never been a moment for chess like that. Actually, if you go to Paul Morphy, you know, in the late 1850s, early 1860s, he was on the front page of every American newspaper every day because we had never beaten the Old World at anything, and he was beating them at chess. I mean, I'm an economist and a historian, you hesitate to say never. It is remarkable.

It's just everybody knew who he was. I would go in a taxi cab in Spain, and the driver—I mentioned I played chess—and the driver who is, you know, just a normal Spanish person, will turn around and go, "Bobby Fischer loco," because he had this reputation... Your young viewers may not know who Mel Brooks and Gene Wilder are, they're just two of the giants of cinema back then. They were comedians. They wanted chess lessons. Chess was cool. It was a remarkable period. So yes, that PBS show, it was by far their most-watched show ever.

They played it five hours a day, live, showing the games! Can you imagine that? People say chess is like watching the grass grow, no offense to people. But the idea that that would be their most successful show... Donations poured in. And they had this wonderful broadcaster, Shelby Lyman, who, I guess, a lot of women thought was cute, who was the reporter. But he was very entertaining and energetic... My first wife kind of saw me on that show and decided to meet me. Maybe that happens to chess players all the time, but that did not happen to me very much.

Chess.com: O.K., well, that's a good way to meet somebody, I suppose! What about modern commentary? Do you watch anything that, for example, Chess.com is producing? And what do you think about all of the advancements in camera angles, statistics, and post-game interviews? Did you prefer it back in the PBS days, or do you kind of like some of the modern advances?

Rogoff: No, it's much better with the modern advances. The trouble with the PBS days is it's just hard to be that entertaining year in and year out. So Shelby Lyman was able to last through the entire match. But I think if it had been the same again and again, people would have gotten a little bit bored with the style. It'd be hard to have the creativity. Chess is made for the internet. It really is. I mean, you can have the computer analysis.

It's very, very internet-friendly. So I absolutely watch Chess.com and think you do a great job. It's terrific. The commentators express excitement about the game... I'm a pretty busy person. I'm not glued to it all the time, but absolutely, I will watch it in bursts.

Chess.com: There are many top chess players who have gone into economics or investing. You name-drop Norman Weinstein in your book. Pascal Charbonneau comes to mind. There are many others. Do you think that growing up and learning how to play chess makes people good at finance? Or do you think that the people who have a proclivity toward chess are just naturally going to be good at issues involving monetary policy and finance?

Rogoff: Well, I think one of the things I love about chess is that chess is amenable to all different kinds of intellects, all different kinds of personalities... But certainly finance is one of them. Now, to be fair, is chess better than poker for finance? I don't know. I mean, poker is sort of more on point.

Particularly, I'm a macroeconomist, which means you look at policy and interest rates and exchange rates, but sort of academic, longer-term things, and in finance, that's called macroinvesting. Where's the big kahuna? Norman Weinstein was really good at that. That's what he was known for. [That's] where I first heard the phrase "everyone else is just looking a move ahead and Norman's looking for the big kahuna." He was really an elite foreign exchange trader. And chess teaches you that—I don't want to go into cliches—but you need to do both in chess. It's very good for you. Where is your long-term opportunity?

I'd say another thing about finance: It's not just about what to bet on, it's also about where your confidence is. How well do you know it? It's like in chess when you're sort of saying, "how should I change my position? What am I looking for?" You're making that kind of decision. 

Chess.com: Let's get back to your book. I know you largely left the chess world in the late 70s, but we had an interesting intersection of chess and economics, which you could not have known at the time. But in 2003, you met with current FIDE President Arkady Dvorkovich in Moscow, and you described him as being quite affable and charming. And when you arrived, he had a position set up of one of your games with Reshevsky. I've also found him to be very good in conversation with people. Tell us about that meeting and maybe how you think he's done as FIDE president, if you care to comment on that.

Rogoff: Well, the latter is harder for me, being out of it. So I was the chief economist at the International Monetary Fund (IMF), and I went to the Soviet Union. At that time, the IMF was very important to them. Russia had a big default that rocked the world in 1998. My book talks about it. And they were still coming out of it and were working with the IMF, which oftentimes sort of tries to help countries out of it.

So I got there, I met with all kinds of people, the finance minister, the head of the central bank. I did not meet with (Vladimir) Putin, but I met with a number of very high officials. And the people at the IMF said, "We want you to meet this person we think is the smartest economist in the government. He is amazing. He will explain everything to you." So I said O.K. I met him and I got to his office and he's improbably young, it turned out (I looked it up later). I think he was 30 at the time, or he might've been 29.

Rogoff: And [Dvorkovich] has this giant, giant office in the Kremlin, which is kind of impressive. And he had a chess game sitting in the middle of the room. And it was the very, very end of a game I won against the great Samuel Reshevsky. Reshevsky was quite elderly at the time, and I was not. So I'm not going to say I was better than Reshevsky, no way. But he had that position.

And in truth, I was so tense about going to meet this super Kremlin genius official, and a little nervous about it because you're in the Kremlin. I have a very good memory for my chess positions, but this was way late in the game when Reshevsky didn't resign when the game was over. He played like an extra 20 moves. And I didn't right away recognize the position. And Dvorkovich said, "You know, that's your game." And I said, "Wow!"

And then he mentioned that his father was an elite arbiter. One of the top arbiters in the world. [Ed: Vladimir Dvorkovich.] He explained things to me with a candor, a clarity that no one else did. When you're in the Kremlin, you have to take everything with a grain of salt. I emphasize that in the book. But I mean, some of his phrasing was so... You know, he's explaining it, "There are a lot of problems in Russia," but he said, "You know, everyone's broke."

I can't remember the exact numbers, but "you give two million soldiers Kalashnikov rifles and a million policemen..." I'm forgetting the name of the pistol, Markovitch pistols or whatever. I'm not getting that one right, "...and they're going to do some corrupt things."

Chess.com: Might've been Makarov, but yeah.

Rogoff: Makarov, right. Yeah, "...you're going to get some corruption. And, you know, these people, their families can't eat. Everyone's desperate. People are driving a taxi because they're earning more money than they can earn as a doctor." It was this clarity that I hadn't experienced anywhere else.

Chess.com: So obviously, you've talked economics with Dvorkovich. What about with any modern GMs? I know that Nakamura used to talk a lot about investing on his stream. Have any grandmasters come to you to seek out your very learned opinions on perhaps where to invest their money?

Rogoff: Well, I  think one person who would definitely talk to me was Nigel Short. I met him actually when he was preparing to play Kasparov. I met him when he was preparing with Lubomir Kavalek, who was a good friend of mine. We both lived in Washington, D.C. I met him in 2010, and Nigel was married to a Greek woman, and he had a lot of his assets in Greece. It was just on the cusp of things going south. And he said, "Should I keep my money there?" I said, "No! Get it out!" And he was so grateful to me later. I mean, I could have been wrong.

Chess.com: We might get to a few straight economics questions at the end, but getting back to chess, you actually played Richard Greenblatt's (computer), one of the first chess computers, back in the 70s. You said you actually gave up chess right after beating it. And then you made a really incredible claim that you've not played a single game of competitive chess since the late 70s, except for that one draw. We need to mention that you did make a draw with Magnus in your one competitive game. Is that really true? You've never gone online or played with anybody any sort of game of serious chess?

Rogoff: Yes, it's literally true. I played a game against the son of my wife's best friend. He was six years old. I wouldn't play her father when he asked. I just don't want to.

I did a blindfold exhibition in 2005 against maybe 12 players who were teenagers, some of whom were pretty good. I think I won all the games, but that was exhausting. And I actually played a game once in DuPont Circle (in Washington, D.C.), at a park with chess sets. I walked by, that was probably 1983, I played one game. That's it.

I have not played online. I have not played with computers. I haven't played. You ask why? I love chess. I think about chess all the time. In fact, in my book, I said to myself, "You think about chess all the time. Why don't you reveal that a little bit when you're thinking about things?"

[Ed: Chess.com could not source that game against the six-year-old, but we did find this one.]

Chess.com: You've met world leaders from all over. You chronicle a lot of those meetings in the course of your book. Do you think that being a grandmaster gave you a little bit of extra clout? Not that they wouldn't respect you anyway, your bona fides are unparalleled, but do you think that that gave you a little bit of extra standing? Like: "This guy, he's really, really smart because he's a grandmaster too."

Rogoff: So I actually only talk about a small percentage of my meetings with world leaders in the book... I think no, although I had this remarkable meeting with Angela Merkel. She was the Chancellor of Germany during the European debt crisis. It was in 2012. And it was a one-on-one meeting that lasted two, two and a half hours. It was scheduled for half an hour. She found me a good sounding board. She was just thinking out loud and decided to talk for a long time. I don't want to pretend that I had so many things to say. But it was an amazing meeting.

Rogoff: I actually pushed my idea at the time that I thought Germany should be really magnanimous about forgiving and writing down the debt of Italy, Spain, Ireland, everybody. And she was actually somewhat open to the idea, but thought it wasn't constitutional. She told me a lot of things which were incredible. She was very smart. And I'll leave it at that. I respect her a lot.

So we finished the meeting, and she said, "Now we have to have pictures taken." I have one in my house. And the pictures are with these giant chess pieces. And I'm thinking: "Did she know that I'm passionate about chess?" And actually, it was because she played chess! It wasn't because of me at all. 

Chess.com: Well, they've got to get better researchers on their team! Anyway, moving on a little bit here toward the end of our interview, I just want to talk a little bit about economics. In fact, even at the very end of your book, you had to throw in a paragraph about the recent U.S. election because that probably came right when you were going to press, and the possible impacts of that. So even though we've got a chess audience, you know, they're probably wondering about your opinion on some things.

I don't know if you're at liberty to talk about it, but here we go with a little lightning round. What is your stance on tariffs?

Rogoff: It's the dumbest policy I've seen in my 50 years of being an economist. By the way, I finished the book the day of the election. I had no idea who would win. I'm an international economist, and you'd think I'd just say tariffs are just generally dumb. They're not so bad, low tariffs. If Donald Trump had come in and just put 10% tariffs, and we went home... You know, taxes are bad, tariffs are a tax. They're mostly on Americans, however he presents it. You could cut another tax. But the problem is not the tariffs. The problem is this 140% on China. If he came in and said, "I'm going to put these tariffs on until you take yours off. You take yours off, I take mine off." I kind of understand it.

But this one is just dumb. It's just one of these things that, if I make a chess comparison, I think of him as a good coffeehouse player. I don't even know if you still have expression? Good coffeehouse players are dangerous, particularly with the initiative, you know, they understand some things and probably don't know a lot of book, don't know a lot of openings. In many ways, that describes Trump's economics. He has some really good instincts, but sometimes the book learning is right. And this is a case where he thinks he knows better from his coffeehouse experience, but what he's doing, the faster he walks it back, the better.

Chess.com: And just to add to the analogy, I've played some coffeehouse players who like to do takebacks, even though I don't officially condone that.

Rogoff: I'm going to use that! I'm going to do that. Oh my God, I hadn't thought of that! Wow. I mean, thank you. That is such a great analogy. I had an analogy that sort of spoke to me, but I didn't quite have it. I'll throw in your idea, Mike, and now it's a home run.

Chess.com: It's all yours. I'm happy to have you borrow it. A couple more econ questions, and then we'll let you go. The through line in your book is that the U.S. dollar, as you said, has peaked and eventually will be replaced by something. Do you think it'll be another currency or do you think it'll be a cryptocurrency when the U.S. dollar inevitably falls?

Rogoff: So my prediction in the book is that it loses its dominance. It's not going to be replaced anytime soon. It just takes a long time to do that. But actually, if you go back 20 years, what everyone thought was happening was that the Euro would become bigger than it did.

I know crypto is very important to your listeners, and I'm gonna tie this back to chess. Because I lived on my own as a young chess player, I feel like I saw a lot of things, and not everyone was following the laws and the rules, and I sort of became quickly aware that there was a big underground economy that was not necessarily paying taxes. I learned over time that cash is used in the underground economy. I'm not giving a moralistic thing about it, but people are trying to avoid detection. And crypto is often more efficient for doing that. I don't believe crypto is going to take over the dollar in the legal economy.

Chess.com: Fascinating. And my final question is really about what you mentioned a couple of times in the book, that institutions that we never think will fail eventually do. You did not see the Soviet Union collapsing... So I'm gonna ask you a fun chess and econ question: What do you think is more likely to exist in, let's say, 50 years: the U.S. Federal Reserve, FIDE, or Chess.com?

Rogoff: I would say not FIDE. I'm sorry to FIDE... You know, I think that's a tough call between Chess.com and the Federal Reserve. I talk a lot about in the book, about Federal Reserve independence. I wrote the first academic paper about why you should have an independent central bank when nobody did. It was very influential in forming central banks. I believe in independent central banking. But it's very hard to be independent, technocratic in a world that's so divided, that's so political.

I'm going with chess. Chess.com. I hope you continue to grow and you're like Disney or, you know, these companies that go on like Coca-Cola. That would be great, and it would tell me that chess was doing really well. So I'm gonna root for you, but I don't know how to choose between those two.