YOU AND I HAVE A RENDEZVOUS WITH SCARCITY: Global economy is heading into a decade of low growth, economist says.

“The reopening of the Chinese economy is certainly going to give a significant boost to growth all over the world, but also — and I think it is a very important factor — German exporters, French exporters have felt the pinch of the lockdown and the weakening of the profit environment in China, and this is certainly going to help a lot.”

However, he suggested that this boost will not come close to bringing growth levels close to where they were in the years before the pandemic for a good while to come.

“I think that we are probably going to move into a decade of very, very poor growth in which developed economies are going to find themselves lucky with 1% growth per annum, if they are able to achieve it, and what is more unfortunate than everything else is with elevated levels of inflation,” Lacalle said.

“I think that we are living the backlash of massive stimulus packages that were implemented in 2020 and 2021. That has not delivered the kind of potential growth that many economists expected.”

Unexpectedly! Why, it’s as if “Milton Friedman isn’t running the show anymore,” as a befuddled senior citizen once said.