Gita Gopinath

I mean, I think that's something we should keep in mind.

I don't think we should take this resilience as some sort of an absolute structural shift that keeps economies growing at their long-term trends, regardless of how big the shock is that's affecting them.

We have this mindset right now in the policy world, and therefore people who are investing in markets, that the state is there to fix a lot of the problems.

And we see it right away even now.

What's happening with energy prices going up is that there are many countries that are capping fuel prices, that are cutting energy taxes.

the instinctive reaction is to protect households and protect their spending power.

And when you do that, that helps corporate profitability, and that is going to be favorable for markets.

So we've been in this environment, now either explicitly or implicitly, I mean, there has to be this notion that the economy has been resilient,

And it is a reflection of what I call bliss, which is big lasting state support, which has helped economies all over the world, not just in the US, but in many other countries.

So the expectation is that that will continue.

And going back to where we started with this conversation, just given how high debt levels are, that's just increasingly questionable, which means that I think governments are going to move towards far more

unorthodox approaches, including price controls, financial repression, the kinds of things that we haven't encouraged in a long time.

Yeah, I read a lot of pieces on this, that somehow China will continue to run trade supplicies because everything it wants, it produces for itself.

and producers for the rest of the world.

And so that's that.

I mean, that makes little sense to me.

Firstly, if you just look at China's spending behavior, they run a surplus on their goods trade front, but they run a deficit on their services trade front.

And so one of the reasons why China's overall deficit, current account deficit or trade deficit, is around 3% of GDP

as compared to like 10% of GDP before the great financial crisis is because they are big consumers of services around the world.

Chinese tourism has been a big contributor to incomes around the world and the service deficit that they run.