Economic policy in many countries has entered a new era of supports and subsidies. But global financial markets have yet to catch up.

Consider some of the headlines over the past week or so. At the IMF/World Bank meetings in Washington, the so-called Bretton Woods institutions came under siege as leaders from the global south decried the hypocrisy of rich-country creditors demanding austerity from borrowers while running up huge debt loads of their own.

In Brussels, former European Central Bank president Mario Draghi gave a speech advocating EU-wide industrial policy. Across the Atlantic, the Biden administration tripled tariffs on China and took up labour unions’ petition for shipbuilding trade relief to counter Chinese state support for its own industry.