Senior Fellow of Yale University,forwardMorgan Stanley Asia Chairman Stephen·Roch（Stephen S. Roach）express,Nearly five years ago,heWarned that the United States is only far from stagflation"A broken supply chain". The impact of the new crown epidemic did trigger a brief stagflation, when inflation soared at the same time as a weak recovery in global demand. But like the epidemic itself, this economic chaos quickly subsided. Today, a more worrying stagflation is taking shape, which may have far-reaching impacts on the global economy and financial markets.

The key difference between the two stagflations is the destructive nature. During the epidemic, supply chain pressure mainly comes from sudden demand——In the early stage of the lockdown, commodity consumption surged and services plummeted, and after the lockdown, there was a reverse adjustment. This has led to soaring commodity prices, chip shortages and shipping bottlenecks, which have jointly contributed to a surge in inflation in the United States from 2021 to 2022.These supply chain disruptions took two years to ease initially, and currently by TrumpThe reconstruction of supply chains triggered by "America First" protectionism will cause a more fundamental impact.

The United States is substantially separated from the global trade network, especially the Asian supply chain, and may even undermine the North American supply chain system built by the US-Mexico-Canada Agreement. Academic research shows that supply chain efficiency has at least reduced U.S. annual inflation rate over the past decade0.5 percentage points,Now this reversal may become permanent trauma. Unlike the epidemic, the collapse of international trust in the United States will not be repaired as Trump leaves office.

Restructuring of the industrial chain is by no means easy. Trump sees corporate investment commitments as a signal of manufacturing revival, but production bases cannot be likeStacked woodIt is usually disassembled and reorganized at will. At a time when policy uncertainty is high,Reciprocal tariffs and sanctions are like swords, the enterprise return plan is likely to be delayed or cancelled. It also takes a long cycle for other countries around the world to rebuild supply chains. This reconstruction that violates comparative advantages will inevitably push up global costs and prices.

What's more dangerous isFedThe fall of independence. Trump publicly claimed that he had the right to interfere in the Federal Reserve's decision-making, and recently threatened to remove Powell. Although it changed its words later, combined with its precedent for illegally replacing the heads of the National Labor Relations Commission and other institutions,The Fed may become the next political victim. This intervention is especially fatal when supply chain disruptions push up inflation——The combination of weak dollar policy and the stagflation period in the 1970s is reappearing.

The other side of stagflation is the rising risk of recession.On April 2, Trump called the date of implementation of reciprocal tariffs "Liberation Day", but in factOpening the Pandora's Magic Box with Shrinking Global Trade. The current US tariff level has exceededDuring the Smurt-Holly Tariff Act of 1930, the bill caused a 65% plunge in global trade from 1929 to 1934.

Rochesay,History warns us that this time we can end with stagflationperhapsIt's already a lucky draw.