There is hope that the war in Ukraine unites those who embrace the values of liberty, territorial integrity and democracy. And the determined fight against climate change holds the potential for strong and sustainable growth. But even then, the challenges we are facing are likely to bring about larger, more frequent and more persistent shocks in the years ahead.
The role of monetary policy The transition to the Great Volatility is not a pre-determined outcome, however. If the nature of the shocks changes – that is, if one of the factors that had contributed to the Great Moderation subsides – the other factor – better policies – becomes more important in ensuring macroeconomic stability.