Secular stagnation in Taiwan draws central bank warning

Taipei

FROM excess savings and a lack of demand to the need for government-led investment, shades of Larry Sum-mers's secular stagnation thesis are evident in Taiwan. Problem is, fiscal and monetary policy makers can't agree on what to do about it.

After cutting rates for the fourth straight meeting, Taiwan's central bank warned on June 30 that monetary policy was shouldering too much of the burden for reviving growth. Reductions in government spending could result in "serious consequence…