King calls for radical shake-up to escape ‘low-growth trap’

Central bank models fail to appreciate demand-side secular stagnation

Mervyn King giving the Per Jacobsson lecture 2019, IMF headquarters, Washington DC

Politicians and central bankers need to radically rethink how they view blockages in the global economic system, if the world is to escape its current “low-growth trap”, said former Bank of England (BoE) governor Mervyn King today (October 19).

Persistent calls for ‘monetary activism’ – or even fiscal stimulus – to address sluggish economic growth are based on fundamentally flawed theory, said King during a Per Jacobsson Lecture address in Washington, DC.

He said if the world wanted to escape

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