So far, the markets have reacted relatively calmly, despite the potential risks to savings, jobs, low-paid workers, financial asset prices and social stability. The social unrest in the Middle East that was the Arab spring began around 2011 with protests in Tunisia over high food prices.

Threatening as it is, though, the bald narrative of inflation is not enough to spook prices. Asset prices can remain in a steady state for long periods of time, but eventually some trigger event brings this homeostasis to an abrupt end. That trigger sets off a phase change, like the physics of ice turning to water then steam.

A Minsky moment is one example of a phase change: when everyone realises they have been too casual about high debt levels and they deleverage at the same time, there is a catastrophic collapse in prices.

In Britain, Bank of England chief economist Andy Haldane is expecting a “tennis ball bounce” of an economic recovery, but also warns of inflation risks. In the US, where a post-Covid-19 surge in demand has caught producers flat-footed, crude goods prices have soared 59 per cent from last year, the biggest year-on-year increase in over four decades.

Ben Hunt, of Epsilon Theory, points out that inflation is already here: “Over the past four quarters, the United States has generated more wage inflation than at any point over the past 40 years.”

Last week, Amazon, Chipotle, and McDonald’s announced hefty increases in starting pay and hourly wages. Where they lead, others will have to follow.

In April, the monthly increase in the consumer price index was the largest since the 1980s, exacerbated by President Joe Biden’s stimulus cheques. John Authers of Bloomberg finds that Google searches for the word “inflation” have hit their highest level since the global financial crisis.

Inflation expectations are inherently sticky. The general population may not fear rising prices for a long time – but when they do, they don’t forget. If they expect prices to rise, they demand more, buy products now, and become assertive about wages. I well remember an overheated Hong Kong in the early 1990s, when annual salary increases of 25 per cent only just kept pace with rising prices.

The Fed first misunderstood inflation by setting a 2 per cent inflation target for raising interest rates. This is illogical because inflation is a result of policy, not a cause. The current narrative is that if the Fed pushes rates up, it will cause an economic collapse.

How does a group of highly intelligent people, supported by an army of analysts, get it so wrong? It is because the members of the Federal Reserve Board are people trained to look backwards; senior academics, top managers, lawyers, government officials and economists, often promoted into dead men’s shoes.

The qualifications of former president Donald Trump’s appointees are particularly underwhelming. The board needs bankers or traders who are trained to look forward in making decisions about a future world.

The moment when a light bulb flashes in the mind is different from the Minsky moment and the debt narrative, so I’m calling this the “Harris moment”: markets don’t just collapse but follow a J-curve. They fall on the initial deleveraging but rise as people learn to handle runaway inflation.

Debt is inflated away, providing cash to move into real assets with intrinsic or earnings value, like commodities, property, gold and inflation-resistant company shares – anything but paper (or digital) cash.

The Harris moment will come when a light bulb flashes at the Fed and the US central bank realises that inflation expectations are too sticky to ignore. But the genie will not be easily put back into the bottle. We are all going to have to get used to rising prices.

Richard Harris is chief executive of Port Shelter Investment and is a veteran investment manager, banker, writer and broadcaster, and financial expert witness