During the worst days of the financial crisis, investors and policymakers talked of decoupling, asking if the rich countries crashed would emerging economies continue to grow. They did. But this spawned another mantra: the two-speed world, in which emerging markets surged even as the advanced nations stagnated. We believe it is time to start talking about another, more ominous moniker for the times ahead: the four-speed world, and the dangers it poses to global growth.

This world is one divided not just between countries with fast and slow growth, but also those with low and high inflation. The original two-speed world was the cousin of another hoped-for mantra, global rebalancing. This pushed emerging markets to stimulate domestic demand, and thus help sustain global growth, while the US and others took time out to fix the deficits that impaired their economic dynamism. But it is that same process that is now starting to stoke inflation in many parts of the world.

In a few countries, such as Venezuela, there is slow growth and high inflation. In a few others, such as Taiwan, there is fast growth and low inflation. But in most countries inflation and growth go together, as one would expect. In the slow-growing, advanced countries, inflation is contained at about 2 per cent, whereas in the fast-growing, developing countries it has become a threat, at 6 per cent or higher.