On the Record On the 2026 Q1 World Economic Update
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Jan 27, 2026 
Natasha Sarin, Yale law professor focused on fiscal sustainability; Jan Hatzius, Goldman Sachs chief economist with data-driven macro forecasts; Karen Karniol-Tambour, Bridgewater co-CIO on macro and AI market effects. They discuss geopolitical volatility and market complacency. They cover rising U.S. public debt and Europe’s fiscal strain. They debate AI’s macro impact, China’s mixed outlook, and private credit risks.
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Geopolitics Matter More Than Immediate Oil Shock
- Karen Karniol-Tambour argues Venezuela's oil shock is economically limited but politically significant.
- The operation signals a more unilateral, emboldened U.S. that shifts global strategic behavior.
U.S. Debt Trajectory Is Worryingly High
- Natasha Sarin warns U.S. debt-to-GDP could reach about 139–140% by decade's end without tariff windfalls.
- She highlights looming entitlement shortfalls and weak political will for deficit reduction.
Fiscal Needs Rise As Productivity Weakens
- Karen Karniol-Tambour links higher fiscal needs to modern mercantilism and supply‑chain security spending.
- She argues poorer productivity plus new defense and AI demands push many rich countries into fiscal stress.