Eswar Prasad

economy is certainly holding together.

We see that in economic performance.

We see that in financial markets.

And of course,

It is a relative perspective that is important here as well, because the U.S.

economy looks much better, even though there are some weaknesses relative to most of the countries.

China, as I said, is growing in a very unbalanced fashion.

India, it is true, is registering pretty good growth right now.

But the rest of the world, especially advanced economies in Europe, Japan, the United Kingdom, are in a shambles.

The one concern I have about the U.S.

is that things look very good on the surface, whether you look at GDP growth, labor market performance, financial market indicators.

Under the surface, if you take the doom loop thesis seriously, there are a lot of tensions building up that I think are really fraying the social fabric.

I think the reality is that if you look at government expenditures, you know, interest expenditures on government debt have been rising and they're sucking money away from more productive investments.

So going back to my discussion of productivity, that really matters.

is a crucial issue.

You know, we don't quite know why productivity in the US is doing so well.

I mean, we have some guesses.

AI may be an important part of it.

Maybe the deregulation that we've seen over the last year is an important part of it.

So if we can generate this sort of dynamism so that if you look at