Commentary: Is the economy invulnerable or are we just lucky?

Commentary

The world economy is resilient partly because it has been lucky, but luck runs out, says Martin Wolf for The Financial Times.

Vehicles pass near shipping containers stacked at the Port of Los Angeles on May 28, 2026 in Los Angeles, California. (File photo: Getty Images via AFP/Mario Tama)

03 Jul 2026 05:59AM

LONDON: The world economy has remained resilient despite the post-pandemic burst of inflation, Donald Trump’s tariffs, Russia’s ongoing war on Ukraine, the Iran war and, as a result of these two conflicts, big energy shocks, the most recent being quantitatively the biggest in history.Should the conclusion be that the economy is invulnerable or just lucky? If it is luck, how could it finally run out?The lucid analysis in the latest Annual Economic Report from the Bank for International Settlements demonstrates that there has indeed been resilience, but also luck.Moreover, it shows dangers are building up, notably in the interaction between fiscal and financial fragilities. One should add to this the social, financial and other vulnerabilities likely to be created, or worsened, by the triumphant march of artificial intelligence through the economy.