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Zombies and stagflation: Mario Draghi’s crisis prescription
In late March, Mario Draghi broke his post-ECB silence with an article in the Financial Times that set out several recipes for how to address the economic difficulties brought on by measures to contain the COVID-19 pandemic. Essentially calling for a “whatever it takes” part two, he urged central banks to open the liquidity gates and governments to take on huge debt burdens. There is a significant question however, about whether those measures will solve the problem or compound it.