Economics & Growth | Monetary Policy & Inflation
Economic historian Paul Schmelzing discusses his new paper “Eight centuries of global real interest rates, R-G, and the ‘suprasecular’ decline, 1311–2018.”
• Schmelzing’s wanted to enter the secular stagnation debate, which he felt was misguided in using the 1970s as a starting point to look at trends.
• His key findings are that long-term real rates have been trending down for 500 years and there have been 46 instances of negative rates since 1311.
• The 1960s and 70s is an outlier with rates breaking out. Volker triggered a return to the centuries old trend with his war on inflation.
This article is only available to Macro Hive subscribers. Sign-up to receive world-class macro analysis with a daily curated newsletter, podcast, original content from award-winning researchers, cross market strategy, equity insights, trade ideas, crypto flow frameworks, academic paper summaries, explanation and analysis of market-moving events, community investor chat room, and more.