The Bank of Canada has just lowered rates to protect the Canadian economy from being disrupted by collapsing oil prices. And the E.U. central bank has just announced it intends to massively expand the European money supply. Except for oil prices, nothing much has changed.

As I have long argued in this space, there is little reason to expect growth to resume its historical rate within the medium term. The only way we could get strong sustained growth is if every one of the world’s immediate challenges is resolved quickly. There are so many problems in so many places that this was always an optimistically unrealistic outlook. The E.U. struggles to avoid falling back into recession; China is under stress as it copes with dramatically [for it] slower growth, never mind the inherent contradictions in its public/private authoritarian system; the United States has neither a functioning government nor a coherent economic policy; most of the other high-growth economies of the world, like Brazil and India, have come to the end of their brief interlude of effortless growth; Russia is offline; the commodity markets are chaotic and stock markets understandably volatile. At least the American economy is generating respectable growth. But the U.S. economy cannot carry the global economy on its back, and has not been able to do so for years. And American growth is itself still inherently fragile. After being force-fed money since the last recession, we should not celebrate this progress uncritically.

Remember that when the storm hit in 2008, the deluge almost extinguished the fires of the economy. So we poured gasoline on the embers in order stay warm. Again and again we throw the gasoline of cheap money into the economy. Finally, after 7 years the U.S. economic fire looks sustainable. But given how much gasoline we poured on the campfire, the forest itself should have burned down.

What, Dear Readers, happens when the run of absurdly cheap money comes to an end? The simple answer is we do not know. We have never engaged in such aggressive monetary policy and so there is no precedent, no historical norm to guide us. Will we calmly absorb higher interest rates by gradually re-adjusting our spending? Or will we panic and drastically reduce spending? Who knows?

Notice the difficult choice the world now has before it. Interest rates will stay low because economic growth is so limited. Or interest rates rise because growth is strengthening and needs to be restrained. Either way, high sustained growth is excluded.

Recognize that I am not objecting to this degree of monetary stimulus. All things considered, it was necessary since the global economy was in grave danger. But this stimulus comes with heavy costs: the distortion of property and stock markets, the accumulation of high indebtedness and a literal addiction to cheap money.

Longer term we will struggle to break this addiction. For the moment, slow growth means low rates continue. So what does the individual do? Look aggressively for profitable investments. Support start-ups and small high growth companies. Develop a career strategy that builds a strong competitive distinction. Make sure that no matter what happens you will be in demand for expertise and knowledge that cannot easily be found elsewhere.

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