Larry Summers

From 2022 to 2025, US unemployment and inflation will both average above 5 percent (stagflation).

“The Fed's current policy trajectory is likely to lead to stagflation, with average unemployment and inflation both averaging over 5 percent over the next few years”

Said on

15 March 2022 · Washington Post op-ed, "The Fed is charting a course to stagflation and recession"

Source

The Fed is charting a course to stagflation and recession · Lawrence H. Summers (reprint of Washington Post column)

Should come true

2025

How sure they sounded

is likely to

Categories

Economy

Importance

4 of 5 · US stagflation would have had major global economic consequences.

Outcome

Inaccurate

US unemployment never went above 4.5% from 2022 through 2025, far from averaging over 5% (BLS). Inflation was high in 2022 but fell to about 3% by 2024, so the predicted stagflation did not happen. No recession was dated either (NBER).

Evidence:

• https://data.bls.gov/timeseries/LNS14000000
• https://www.nber.org/research/business-cycle-dating