Paul Volcker, former Fed Chair 1979 to 1987.
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- Inflation cooled in October, but prices have been elevated for over 20 months now, raising concerns of stagflation.
- That means the economy could be slammed with high unemployment, low growth, and persistent inflation – as well as a steep drop in stocks.
- Here’s what five experts have said about the risks of stagflation and why markets should be more concerned.
Inflation cooled more than expected in October’s Consumer Price Index report – but prices are still well above the Fed’s 2% target, and they’ve been above-target for 20 months now.
That “sticky” inflation has sparked fears of stagflation, a dreaded scenario where high inflation gets entrenched into expectations, slamming the economy with a whirlwind of slow growth, high unemployment (and yes, high prices).
Those conditions defined the US economy throughout the 1970s and early 1980s, pushing the Fed to…
