Sat. Jan 22nd, 2022


In assessing this year’s US inflation outlook, Rana Foroohar adds, as an afterthought, the historical issue of debt and asset bubbles of decades of declining interest rates and unprecedented quantitative easing (Opinion4 January).

This is quite surprising, as today’s bubbles are much more pervasive and debt levels much higher than in 2008.

Where in 2008 the bubbles were largely confined to the US housing and credit markets, today they can be found in almost every corner of the world’s asset and debt markets.

One would think that just as the bursts of the 2008 bubbles led to a long period of very low inflation, so too will the bursts of today’s more penetrating bubbles burst when global liquidity dries up or when China’s real estate and credit leads economic growth model run out. of steam.

Desmond Lachman
American Enterprise Institute,
Washington, DC, USA



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