from the opinion pages of the Wall Street Journal. This is Free Expression with Jerry Baker.

Welcome to Free Expression with me, Jerry Baker from the Wall Street Journal editorial page.

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This week is a financial crisis in our future. Now, that may seem a strange question with

the US economy continuing to create bountiful jobs, unemployment hitting a record low,

and market starting the year in buoyant mood. But could these very conditions be sowing the seeds of financial distress?

The Federal Reserve raised interest rates again last week after a year of sharp rate hikes,

and Jerome Powell, the Fed Chair, has made clear that he thinks the central bank needs to do even more.

With labour markets so tight, the problem is that wage demands seem likely to remain

strong, putting upward pressure on inflation. One major financial institution now thinks the Fed funds rate

could go as high as 6% this year, up from zero a year ago, and still just below 5 right now.

Now, that pace of tightening is almost unprecedented and as often in the past produced

financial distress. Against the backdrop of years of easy money and massive expansion in private and

public debt, we could be creating the conditions for a new crisis. And after all, we do seem to get

such crises with remarkable regularity, just about every 10 years or so. Perhaps we are,

after all, overdue for one. That at least is the view of my guest this week, Ken Rogoff.

Rogoff is Professor of Economics at Harvard and served as chief economist of the IMF. His expertise

is financial economics. He's written extensively about the dangers of excessive debt, particularly

government debt, including a famous, and to some people controversial book about the dangers of excessive debt, particularly government debt, including a

famous, and to some people, controversial book about the relationship between levels of debt

and the onset of crises and recessions. Ken is also a chess grandmaster. In fact, he dropped out

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