The global economy is powered primarily by energy and debt, with energy-providing production and debt-providing finance. Today, central banks are aggressively increasing interest rates in order to counter inflation, but the move could leave commodity prices too low for producers. If the debt bubble bursts then we will be faced with a shrinking economy that cannot accommodate a growing population. The years between 1981 and 2020 were very special years for the world economy because interest rates were generally falling: Figure 1. Yields on 10-year and 3-month US Treasuries, in a chart made by the Federal Reserve of St. Louis, as of May 10, 2022. In some sense, falling interest rates meant that debt was becoming increasingly affordable. The monthly out-of-pocket expense for a […]