What more permanent shape will the global economy take after the lockdowns are fully relieved? How fast will the global economy grow when something like normality resumes? Additional output of just 1%-2% per annum would amount to secular stagnation. Some already argue that demand will have difficulty keeping up with even modest extra supplies of goods, services and labour, and that monetary policy has shot its bolt because interest rates cannot go much below zero.

We should dismiss such underconsumption theories. Monetary stimulus comes not only from lower interest rates but also in the form of increases in the supply of money itself, as is now being demonstrated by the central banks in the developed world that are creating extra money at a rate never tried before. This is having a demonstratively helpful effect on spending and asset prices. If there is to be economic stagnation it will be for a want of willingness to supply, not from any permanent lack of demand. Stimulating...

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