Secular stagnation is not over
I do not think so. Today’s inflation will not last, but I believe that low rates will.
Secular stagnation, a concept put forward by the economist Alvin Hansen in 1938, refers to economies suffering from structurally low private demand, requiring very low interest rates to sustain demand and achieve potential output—indeed requiring interest rates so low that they are lower than the growth rate. This state is summarized by a formulation that has become famous (at least in macroeconomic discussions…): r < g, a safe interest rate lower than the growth rate of the…