Economist Nouriel Roubini, known for his gloomy-yet-accurate prediction of the 2008 financial crash, warned in a recent op-ed that the global supply chain crisis combined with high debt ratios and ultra-loose monetary and fiscal policies threaten to turn the “mild stagflation” of recent months into a stagflationary crisis. Roubini argued in the Sept. 21 op-ed “Goldilocks Is Dying” that the optimistic outlook of stronger economic growth alongside moderating inflation may turn out to be wishful thinking. “Given today’s high debt ratios, supply-side risks, and ultra-loose monetary and fiscal policies, the rosy scenario that is currently priced into financial markets may turn out to be a pipe dream,” Roubini wrote. The supply-side shocks Roubini speaks of could stem from a range of sources, including new pandemic waves, demographic aging in developing and emerging economies, the balkanization of global supply chains, and cyberattacks. He argues that persistent negative supply shocks could stifle growth …
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