Economist Larry Summers stated that “we’re now facing real risks of a 1970s-type scenario…the same kind of broad phenomenon of stagflation.” And that this is partially “a response to the excessive stimulation of the economy during 2021.”
On Friday’s broadcast of Bloomberg’s “Wall Street Week,” economist Larry Summers stated that “we’re now facing real risks of a 1970s-type scenario…the same kind of broad phenomenon of stagflation.” And that this is partially “a response to the excessive stimulation of the economy during 2021.”
Summers stated that monetary policy is effective at tamping down inflationary pressures, “but it may not be an effective tool without engineering a slowdown in the economy. The last dot plot has the Fed believing that three things are going to happen together: that inflation’s going to fall below three, unemployment’s going to stay well below four, and interest rates are never going to go above 2.5. I don’t think those things are all likely to happen together.
He continued, “I think we’re now facing real risks of a 1970s-type scenario, not quite as high levels of inflation as we saw in the 1970s, but the same kind of broad phenomenon of stagflation. And that is, in part, a response to the very bad break we’ve gotten from the geopolitics and what’s happening with oil and commodities. But it’s also a response to the excessive stimulation of the economy during 2021.
Singapore Latest News, Singapore Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
How the Ukraine crisis could make the 2020s like the 1970sThe surge of commodity prices from the Russian invasion makes for a striking parallel between the 2020s and the 1970s.
Read more »
European markets set to fall as U.S., Europe consider Russian oil ban; oil prices surgeEuropean stocks are set to tumble after news that the U.S. and European allies are considering a ban on Russian oil imports, posing a global stagflation risk.
Read more »
Eastern US faces hail, wind, severe weather riskAfter deadly tornadoes tore through the Midwest this weekend, the risk has now moved into areas stretching from the Southeast to the Northeast.
Read more »
Belstaff coasts through Morocco in easygoing campaignBritish fashion label Belstaff has escaped the cold to visit the warm coast of Morocco as it celebrates its spring/summer 2022 collection and anxiously awaits the summer season.
Read more »
Inside SoCal: 3/6 Wrap UpWe're celebrating Women's History Month and paying tribute to L.A. trailblazers.
Read more »
Houston's Hobbit Cafe turns 50 this year, with enormous burgers and mead to celebrateNoted for its Lord of the Rings theme, Hobbit Cafe is celebrating fifty years in...
Read more »