Could it be that world governments and central banks are now taking drastic measures to re-inflate their economies because they don't believe their own economic statistics?
Downward pressure on the U.S. economy is already becoming apparent. Data on home sales, industrial production, jobless claims and regional manufacturing surveys have all recently disappointed.
As the outlook for growth continues to deteriorate, whilst the price for goods and services remain stubbornly high, the risk of stagflation returns. This would be a tough scenario, where policy options tackling one of these issues would only worsen the other.
By Hilda Ochoa-Brillembourg
President, CEO & CIO
Strategic Investment Group
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Because there are many similarities to the 1970s when it comes to the economy, I am going to dub the current economic situation "inCESSION," not "stagflation."
Because "stagflation" sounds a hell off a lot scarier than "recession," you'll probably be hearing a lot about it in the financial media over the coming weeks.
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