Arch, that's a possibility that must be considered.
It's been somewhat amusing to read the daily parade of failed predictions by adherents to this or that economic theory, from the Austrian School of economics to interventionist fiat-money economists (which comprise prevailing global orthodoxy, practiced for decades).
Few really understand what CBs are doing, but many are absolutely convinced it's wrong. With wild abandon, they mix precepts from different schools of economic thought - then fail to take their thinking to its logical extension. For instance, one of the more extreme possibilities is that this may be the point of failure for fiat-money interventionist economics itself.
Because it's just an economic theory: one of many.
They call economics "the dismal science" for good reason: it's no "science" at all. Even economists are split: there's no consensus in their thinking, and they're supposed to be the "experts".
Globally, we have historically high levels of government debt, so great it's possible it may "crowd out" private borrowing, with all that implies.
We're in uncharted territory; I agree completely with your level-headed approach... be aware of all possibilities, don't get hung up on economic ideology, don't be guided by theory.
An old saying, paraphrased:
"Surplus is good, excessive debt is bad. All the rest is commentary."
Jim |
