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2022 Predictions: Which Way Will the Economic Recovery Go?

January 12, 2022 Leave a comment DRI Admin

The DRI International Future Vision Committee has released its 7th Annual Predictions Report, looking ahead to 2022 and its impact on the resilience community. Download the complete report free from the DRI Library, and read on for a prediction on the continuing global economic recovery.

Prediction 3: Inflation and higher interest rates slow global economic recovery

Inflation is the increase in money supply without a commensurate increase in productivity. The pandemic has produced the conditions in which inflation is inevitable. A huge government-sponsored increase in the money supply (caused by quantitative easement (QE) and direct payments to individuals and businesses) has been accompanied by a reduction in supply caused by transport issues and some actual material shortages. Although QE is likely to end in the near future, this is unlikely to slow inflation while the supply chain and transport problems remain.

The central banks can keep interest rates down for only some time before an inevitable rate increase, thus slowing the economy. This is really a very difficult situation.

Even China will face some economic setbacks. An early example is Evergrande (the world’s most indebted real estate developer) failing to meet a series of deadlines for bond interest payments. This leaves the Chinese government in a tricky situation of how to deal with sizeable corporate failures.

Join us for DRI2022 in Las Vegas Feb. 13-16, 2022, where Future Vision Committee Chair Lyndon Bird will lead an interactive session where participants will have the opportunity to vote on a number of the key issues which have emerged from the reports. Bird will respond to voting as it happens, providing instant feedback and opinion. Please come to this session ready to participate, debate, and even argue if you wish. Challenging and controversial opinions are welcome.

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