Well, I told you so. The UK economy actually contracted in the last quarter of 2010, while inflation is headed, by anyone's calculation, up to around 4% by April (on the official figure, or around 5% on the retail price index).

We have stagflation, in other words. And it's going to continue just as long as we keep on printing money and keeping interest rates low. Business failures are at a 30-year low: after an economic shock of this size, we really should be experiencing a lot more pain. But no, bad businesses are being kept afloat by quantitative easing, cheap credit and government spending and borrowing.

It was expansionary Keynesian policies that got us into the boom-bust cycle. Then the US and UK governments tried more expansionary Keynesian policies to try to get us out again. But we will only come out when the value of money is stable so that the price system starts working properly again, when credit is no longer too cheap so that people start making rational investments and abandoning lost causes again, and when government balance their books instead of trying to print and borrow their way out of debt. It was a long party, and we must expect a long hangover, though it will be quicker if we just suffer it rather than keep taking a hair of the dog. The pain is actually the cure.

Roll up that book of Keynes, Mr Secretary: we'll not be needing it these ten years.