Jim Grant has been tracking the ins and outs of Federal Reserve policy and its effects on the economy and markets in his famed newsletter, Grant’s Interest Rate Observer, for over 40 years. The always bow-tied and often staunchly skeptical economic historian has made a name for himself with some pretty prophetic forecasts ahead of past financial calamities, including the Global Financial Crisis.
Now, in an interview with Fortune, Grant lays out his fears that another potential disaster is on the horizon. After roughly a decade of near-zero interest rates, he argues, the U.S. economy developed a debt problem—one likely to end badly now that higher interest rates are here to stay. The inevitable fallout from the end of the “free money era” has yet to be felt fully, Grant warns.
