Press

William White and Sunil Sharma coauthored an article that was posted by OMFIF on 21 April, 2022. They argue that we could be one serious economic crisis away from significant political turmoil that might threaten our democratic traditions. After decades of slow growth, stagnant real wages, and the many costs of covid, a restless public is increasingly inclined to see political structures as “rigged” and “unfair”.  We must cease relying on macroeconomic stimulus (especially monetary policy) to paper over structural problems, while inadvertently making them worse. Instead,  policymakers should address those structural issues more directly: not least, rising inequality, market concentration, environmental degradation and the need for debt restructuring.

https://www.omfif.org/2022/04/structural-reforms-required-to-safeguard-democratic-future/

William White, along with others, answered a question posed by the editors of The International Economy for their Winter 2022 edition: “To what extent is today’s massive global ocean of liquidity breaking all the rules in US financial markets?” White suggests (page 10) that nominal bond rates have stayed low, in part, because the Fed has convinced the bond markets that real rates are “naturally” low, and that higher inflation is only transitory. Should either of these arguments be contested, and White notes there are good grounds to believe they might be, then nominal rates might rise sharply. In this case, ” the effects on an overleveraged global economy would not be pretty”.

Along with twenty other economists, William White answered the question posed by The International Economy. White advised that the negative effects of ultra-easy monetary policy extend well beyond overpriced assets and that another economic downturn could be triggered by a variety of sources. A new focus on facilitating “orderly” debt restructuring would be unpalatable but still preferable to a “disorderly” and potentially disastrous alternative.