Paul Kedrosky
speaker
1,259 appearances
4 recordings
2 series
first heard Apr 2026
last heard 3d ago
Paul Kedrosky’s voice in public audio — every appearance, attributed to the second.
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recordings per month · last 12 monthsRecordings per month over the last 12 months — 4 in all, peaking in Sep 2026 with 1.
Appearances
To put myself into a kind of uh like a debt workout and say, I'm gonna spend the next 10 years getting all this debt off my balance sheet again because it doesn't need it.
I don't want to have it there anymore because it's no longer required for you know ongoing purposes because I'm not spending that heavily in future and I'm being punished for it because I have this huge debt obligation.
So think about the consequences.
You're not spending on growth, you're not spending on employment.
And you're trying to unwind all this debt and get it off your balance sheet.
So a balance sheet is recession, is a workout where heavily indebted companies, irregardless of interest rates, continue to try and get themselves less leverage, get the debt off their balance sheets.
And so the problem is, of course, this is going to come at a time when there's already other pressures on hiring, with you know, the AI effects at the margin.
So the effects overall on
Hiring will be even more dramatic because companies are are will be focused entirely on deleveraging.
So at the same time as they're looking for opportunities to use AI to have fewer people around.
So this will be really consequential over the next five years.
And it's really not well understood that we kind of sit on the edge of a Japan moment in terms of the likelihood of a balance sheet recession, given that there's this really profound misunderstanding of what the causes are of inflation.
Inflation in the economy and what's what w the effect that rates are gonna have, and we're actually sitting in a kind of def deflationary moment masked by what's happening in AI.
So for regular people, the ex your expectation should be that over the next, say over the next year or so, we'll start seeing increasing signs that the economy is much weaker than people expect.
And as a result, we'll probably be heading into a a relatively longer recession, which is inevitable after a moment like this.
A longer recession than people expect that with a few policy policy errors could easily be something on par with uh what often is called a depression.
So a recession that turns into a depression, which means multi-year and really consequential in terms of companies and themselves becoming insolvent as they try to work off debt.
So the problem, of course, is normally when that happens, w the government steps in and tries to, in a Keynesian way, and tries to replace the lost consumer spending with increased fiscal spending.
Um and the problem, of course, is that most
uh and there was a great IMF report out this week showing that most countries around the world are basically all fiscal stimulused out because we've gone through multiple episodes over the last fifteen years.
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