I've used the term "stagflation" before in describing worst case scenario of high inflation (e.g. from what I remember in Volcker raising rates in the early 80's) and why I agree Jerome needs to continue increasing rates until inflation is beaten, even if it causes a recession.
This is the first time I've read of fears in MSM. Hope they're wrong.
The latest GDP numbers have economists fearing more than just a recession: ‘The U.S. might well be facing stagflation’
Quote:
Annualized U.S. gross domestic product growth slowed to 1.1%, the Bureau of Economic Analysis (BEA) reported Thursday, well below consensus expectations on Wall Street for 1.9%. At the same time, one of the Federal Reserve’s favorite inflation gauges, the personal consumption expenditures (PCE) index, increased to 4.2%, higher than the expected 3.7%.
“This morning’s data was the worst of both worlds, with growth down and inflation up,” said Chris Zaccarelli, chief investment officer of Independent Advisor Alliance.
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Quote:
... the latest GDP and inflation numbers have some experts worried that stagflation—the toxic economic combination of slow growth and high inflation that crippled the U.S economy in the ’70s—could be on the menu too.
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And some 86% of fund managers said stagflation best describes the outlook from the global economy over the next 12 months in Bank of America’s April Global Fund Manager Survey.
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