Guest post: Fiscal And Monetary Stimulus Has Failed – What Next? by Jonathan Rochford, CFA Portfolio Manager of Narrow Road Capital Pty Ltd
In 2009 a small group of analysts dared to question whether emergency stimulus measures were the beginning of the “Japanisation” of Europe and the US. Ultra-low interest rates, large budget deficits and then quantitative easing were all meant to be temporary. Seven years later, only the most optimistic could see these measures being put away soon.
In 2014 Larry Summers called the current malaise “secular stagnation”. The secular part implies that the change is not cyclical but has become entrenched. The stagnation part means that there is little or no growth. This year the...
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