A “prolonged period” of zero or negative interest rates is going to “lead to distortions,” according to Campbell Harvey, a professor of finance at Duke University famous for his theory that yield-curve inversions precede recessions, and that’s exactly what investors are dealing with right now. The title of Professor Harvey’s new paper, with co-author Rob Arnott, cuts right to the point: “No Excuses: Plan Now for Recession.” The Federal Reserve is playing catch-up, and it knows full well that aggressive rate-hiking will push the economy into recession. It’s a “blunt instrument.” But Professor Harvey is not one to leave not-well enough alone: “Surely there are alternatives that could be considered.” He shares his ideas on a different approach to central banking and his thoughts on managing risk in such an environment with Real Vision’s Ash Bennington. You can click here to read Professor Harvey’s and Rob Arnott’s new paper on the coming recession. Recorded on July 15th, 2022.