Stagflationary shock of Cold War II won’t be transitory
The knock-on effects on global growth and inflation from the Ukraine crisis will be a nightmare scenario for central banks that risk being damned if they do, or don’t, lift interest rates.
Now that Russian President Vladimir Putin has launched a full-scale invasion of Ukraine, we must consider the economic and financial consequences of this massive historic development.
The Ukraine war is not just another minor, globally inconsequential conflict of the kind seen in recent decades. This is a major escalation of Cold War II, in which four revisionist powers – China, Russia, Iran and North Korea – are increasingly challenging the long global dominance of the United States and the Western-led international order that it created after World War II.
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Project Syndicate
Nouriel Roubini is Professor Emeritus of Economics at New York University’s Stern School of Business and Chief Economist at Atlas Capital Team.
