Why the great stagflationary debt crisis is upon us
Governments fighting wars against revisionist states, climate change, pandemics, tech disruption, and inequality will be sorely tempted to inflate their way out of debt.
Inflation rose sharply throughout 2022 across both advanced economies and emerging markets. Structural trends suggest that the problem will be secular, rather than transitory. Specifically, many countries are now engaged in various “wars” – some real, some metaphorical – that will lead to even larger fiscal deficits, more debt monetisation, and higher inflation in the future.
Revisionist states such as Russia are shaking global finances as well as politics. AP
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Nouriel Roubini is Professor Emeritus of Economics at New York University’s Stern School of Business and Chief Economist at Atlas Capital Team.
