Escaping the structural liquidity trap

Investment needs to be subsidised not taxed if developed countries want to avoid inflation and financial crises, writes Andrew Smithers

The economic performance of the US and other major developed economies in the 21st century has been poor, whether the comparison is made with the period of nearly 80 years that have passed since World War II or with the rest of the world over the past two decades. Having suffered the most severe post-war financial crisis in 2008, we now face a high risk of another one; output and incomes have stagnated and inflation has shot up. This abject failure has dangerously damaged liberal democracy

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