On Friday’s spread of Bloomberg’s” Surveillance”, Bloomberg journalist, scholar, President of Queens ‘ College, Allianz Chief Economic Adviser, and former Obama Global Development Council Chair Dr. Mohamed El- Erian stated that the” green power” change has helped make” a world that’s subject to higher inflation” than the world we had before.
After arguing that the 2 % inflation number is an “arbitrary” number , and going from 3 % to 2 % is n’t worth it, El- Erian said that “if you were to establish an inflation target today based on the secular issues, and let’s talk about it, the domestic paradigm is changing. We’re no longer in this Washington discussion of deregulation, liberalization, and governmental patience. We are in a world of industrial policy, government interference, and fiscal carelessness. This talk about the worldwide, we’re no longer talking about…globalization. We’re talking about polarization. Then look at the transitions we have, we have big transitions going on, not only conceptual AI, life sciences, and green power, we have things happening in health care, you have things happening in defence, you have things happening in foods safety. If you put all that together, it is a different inflationary environment. It’s a world that’s subject to higher inflation, and we’ve come from a world that was subject to lower inflation”.
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