Bain’s Stephen Pagliuca Expects Government Stimulus to Drive Inflation

Stephen Pagliuca, co-chairman of private equity firm Bain Capital, said he expects government stimulus programs and the Federal Reserve’s expansionary monetary policy to fuel inflation.

“If you look at all of the data points in any country in the last 100 years, when the money supply increases to that level you have got inflation 95%, 98% of the time within a year or two after those kinds of massive increases,” Pagliuca said Tuesday on Bloomberg Television. “I think there will be inflation.”

Pagliuca said he expects interest rates to remain low, which will make private equity attractive as investors search for yield. “I don’t see how policy makers will raise those rates that high in the face of inflation,” he said.

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