Why SocGen's Albert Edwards Sees Double-Digit Inflation Coming Back

The global economic paradigm is shifting from the disinflationary "Ice Age" of the past two decades toward a period defined by fiscal dominance and potential double-digit inflation. Albert Edwards, global strategist at Société Générale, argues that while his long-term bearish view on equities was tempered by quantitative easing, the current era of unchecked fiscal expansion and unsustainable debt-to-GDP ratios creates a new, volatile environment. Governments are increasingly unable to implement necessary fiscal consolidation due to political constraints and intergenerational tensions. Although AI-driven capital expenditure currently sustains equity markets, the broader economy faces significant risks as consumer savings ratios collapse and corporate margins face pressure from rising costs. This environment leaves bond vigilantes poised to challenge fiscal miscreants, potentially ending the era of low-rate, high-valuation market growth.