The mugger’s accomplice

‘Inflation,’ Ronald Reagan declared, ‘is as violent as a mugger.’ In response, the world pursued zero-tolerance policies for two decades, to the point at which politicians and central bankers began to believe they had actually eradicated the menace. When Gordon Brown used to boast that there would be ‘no more boom and bust’, he was relying in large part on a belief that inflation had been permanently defeated by monetary and fiscal prudence combined with globalised trade.