Economist Lawrence H. Summers never joined Team Transitory, or the economists, investment strategists, and members of the Federal Reserve who thought inflation would be a temporary phenomenon. Instead, he warned early and often that massive fiscal and monetary stimulus unleashed in response to the impact of the Covid pandemic would result in the economy overheating. He was right: Consumer prices rose 8.6% year over year in May, the fastest pace in 40 years.
Summers is the Charles W. Eliot University Professor at Harvard University, president emeritus of the university, and former secretary of the Treasury under President Bill Clinton and director of the National Economic Council under President Barack Obama. Long worried about secular stagnation, marked by sluggish growth and weak inflation, Summers is now concerned that the U.S. economy is headed for a hard landing as the Fed fights inflation. READ MORE