The key role of the end of inflation in OECD countries

The key role played by the disappearance of inflation in OECD countries , despite full employment, must not be underestimated. Because inflation remains low at full employment: Interest rates remain low, even late in the expansion period; High debt does not pose a problem; Asset prices (financial and real estate) are able to remain high; Corporate profitability remains high late in the expansion period; There is no longer any internal mechanism within countries capable of triggering a recession, so the magnitude of cycles becomes much smaller. We illustrate these points with the situations of the United States and the euro zone.