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Opinion
Mark Gongloff

China’s Hot New Export Could Be Stagflation

Prophets of inflationary doom, take note.

Those stacks don’t buy as much as they used to.

Those stacks don’t buy as much as they used to.

Photograph: AFP/Getty Images

For decades, China made it easy to mock inflation Cassandras by pumping deflation into the world. It was like Arrakis with spice, except instead of space-folding and prescience you got stagnant wages and low interest rates. 

The inflation Cassandras may finally be having their revenge. Like everybody else in the world dealing with shortages of chickens, lumber and chlorine, China has its own supply problems and rising prices, writes Dan Moss. Just like everyone else, it hopes these are temporary. But its economy has developed enough in recent decades, and its wages have risen enough, that its days of keeping global growth high and prices low are over.