What next for the post covid global economy: Could negative supply shocks disrupt other fragile systems?

This INET Working Paper, posted on 26 January 2023, is based upon an earlier  presentation. White’s general premise is that our economic, political, public health and environmental systems are all complex, adaptive systems and each is showing clear signs of distress. Moreover,  problems in any one system could easily spread to other systems in a “cascade of tipping points”. In this particular paper, White suggests that existing stress in our economic/financial system is likely to be made worse by a multitude of future, negative supply shocks. In turn, these economic problems might pose a threat to the democratic order in some countries. The paper finishes with reflections on policies that might help to stabilize the situation.

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People get ready: An era of shortages is going to replace our era of plenty

The C D Howe Institute in Toronto published on 5 December an Intelligence Memo written by William White. Essentially a short letter written to the Canadian Minister of Finance, the Memo identifies six sets of negative, future  supply shocks that will put upward pressure on Canadian prices in the next few years. Adding to the difficulties, the Memo also identifies a number of sectors where higher investment spending will be required – not least to deal with environmental issues. To mitigate inflationary pressures, and to  avoid a potentially dangerous reliance on tighter monetary policy, White implies that consumption should be constrained through targeted fiscal measures.



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Is a Dollar Crisis Coming?

This article was published in the Summer 2022 edition of The International Economy. William White notes that forecasts to date which have predicted the demise of the US dollar have been wildly inaccurate. Nevertheless, the arguments supporting those earlier forecasts remain valid and may even have strengthened over time. White suggests there are reasons (solid) for anticipating another global economic and financial crisis, and for believing (less solid) that this could finally trigger a dollar crisis as well.

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How central bank mistakes after 2019 led to inflation

William White wrote the Forward for a New Zealand Initiative publication, authored by Graeme Wheeler and Bryce Wilkinson, in which they contend that expansionary central bank policies contributed significantly to the global inflationary pressures which have emerged in recent years. In his Forward, White agrees that the analytical framework used by many central banks is fundamentally flawed. Not least, central banks have for decades underestimated the importance of recurrent shifts in the supply capacity of the global economy.

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Canadian International Council

On November 18, the Canadian International Council (CIC) posted on  their website a paper prepared earlier by William White for the Council for Economic Policies, a think tank in Zurich. White had made a presentation in July, based in large part on that paper, to a joint meeting of the CIC and the Konrad Adenauer Stiftung. His notes for that meeting are also attached below.


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If something cannot go on forever, it will stop.

At the end of March, the Council on Economic Policies (a Zurich based think tank) posted this piece written by William White. White identifies the many challenges, actual and emerging, threatening the future of our democratic, market based systems and indeed of mankind itself. Our economic, political, environmental and health systems are all showing increased signs of stress and any one of them might “stop”. Since all of these systems are interrelated, problems that emerge in one system will threaten the other systems as well. White describes the key characteristics of more sustainable systems, and suggests policies that might be required to move from the unsustainable path we are on currently to a path that would actually leads us to where we want to go.

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Data science in economics and finance for decision makers

A book with this title, edited by Per Nymand-Andersen and published by Risk Books, became available on 23 March. William White wrote an endorsement, praising the book for its comprehensive approach to the subject (20 chapters written by authors with different specialities) and its willingness to address both the opportunities and the practical challenges offered by new techniques for data collection and  analysis.



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The full case against ultra low and negative interest rates

On 17 March, INET published on its website a blog note (summary) and  Working Paper by William White. The Working Paper argues that, by encouraging the issue of debt, often for unproductive purposes, monetary stimulus becomes increasingly ineffective with time. Worse, it has a number of side effects that become increasingly burdensome over time. It threatens financial instability in a number of ways, leads to real resource misallocations that lower potential growth, and finally produces a policy “debt trap” that cannot be escaped without significant economic costs.

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International financial regulation: Why it still falls short

Previously a Working paper posted by INET, this article has now been published as a chapter in a book called “The next money crash and a reconstruction blueprint”. Edited by Uli Kortsch, the book makes the case that economic systems in which private banks (and shadow banks) effectively create money are inherently prone to crises of increasing seriousness. It effectively argues for a modern version of the Chicago Plan that replaces bank-created-money with sovereign-created-money. White’s paper helps document many of the problems generated by the current system and why monetary and regulatory policies have not been able to overcome them. He also lists a number of reforms, in order of their ease of implementation, that could in principle reduce the need for more radical reform. White finishes by noting that monetary reform at the national level is not enough. We also need to reform the International Monetary (Non) System.

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