From Great Moderation to Great Stagflation

 On the supply side, the backlash against hyper-globalization has been gaining momentum, creating opportunities for populist, nativist, and protectionist politicians. Public anger over stark income and wealth inequalities also has been building, leading to more policies to support workers and the “left behind.” 

However well-intentioned, these policies are now contributing to a dangerous spiral of wage-price inflation.

Central banks are thus locked in a “debt trap”: any attempt to normalize monetary policy will cause debt-servicing burdens to spike, leading to massive insolvencies, cascading financial crises, and fallout in the real economy.

Nouriel Roubini Project Syndicate 9 August 2022

https://www.project-syndicate.org/commentary/great-stagflation-has-replaced-great-moderation-by-nouriel-roubini-2022-08

Forget transitory v persistent. The new fear is that price pressures are “structural”

At the heart of this is not whether central bankers can bring down prices, but whether the underlying inflation dynamic has changed. 

Those in the “structural” camp argue that the recent period of low inflation was an accident of history—helped by relatively calm energy markets, globalisation and Chinese demographics, which pushed down goods prices by lowering the cost of labour.

Buttonwood The Economist 11 August 2022

https://www.economist.com/finance-and-economics/2022/08/11/how-should-investors-prepare-for-repeat-inflation-shocks

Stefan Ingves; världen ändrar sig hela tiden och då får man försöka förstå världen så gott det går - The “Great Moderation”

https://englundmacro.blogspot.com/2021/05/stefan-ingves-varlden-andrar-sig-hela.html

Nouriel Roubini said the US is facing a deep recession

Bloomberg 25 July 2022

https://englundmacro.blogspot.com/2022/07/nouriel-roubini-said-us-is-facing-deep.html