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Save food, water and cash: “We are not prepared for what is coming”

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caballero:
This morning I came across this shocking headline, perhaps alarmist. However, there are data that do not call for optimism. In my opinion, the massive printing of money of the last decade and the 2030 agenda have caused an inflation that has taken a long time to manifest. The first, causes an increase in demand; the second, a shortage of supply.

Consequently, politicians do not seem to come to their senses, but tend to blame someone else. It seems that the way of capping prices is prevailing in Europe. I would recommend the book Forty Centuries of Wage and Price Controls: How Not to Fight Inflation where it is indicated that, throughout history, the result of capping prices is always the same: scarcity.

It is in Spanish, but it can be translated with the browser:

https://www.inversion.es/2022/09/09/guarde-comida-agua-y-efectivo-no-estamos-preparados-para-lo-que-venida-24203/

jj2007:

--- Quote from: caballero on September 11, 2022, 05:53:21 PM ---the massive printing of money of the last decade and the 2030 agenda have caused an inflation that has taken a long time to manifest.
--- End quote ---

The main factors contributing to inflation are:
- increased costs due to Covid
- gas prices that finance Putin's war

So you can blame Xi Ping and Putin, but the ECB has nothing to do with it :cool:

Gunther:
Caballero,

I think you have read the following:


--- Quote from: jj2007 on September 11, 2022, 07:18:07 PM ---The main factors contributing to inflation are:
- increased costs due to Covid
- gas prices that finance Putin's war

--- End quote ---
This is from our forum all-rounder. He is an expert on everything. He just forgot this time what Ms. Lagarde said recently: climate change is responsible for the inflation.
Hopefully the Deep State will forgive this forgetfulness.

caballero:
> So you can blame Xi Ping and Putin, but the ECB has nothing to do with it

Inflation was already high before the Ukraine war started. Gas prices have risen because Europe refuses to buy gas from Russia (and then cries when Russia cuts it off).

Printing money, without productivity support, always generates inflation.


--- Quote ---At the European Central Bank forum in Sintra, Portugal, in June, Powel admitted that "now we understand better how little we understand about inflation.".
--- End quote ---
https://www.bloomberglinea.com/2022/08/26/los-banqueros-centrales-deberian-hacer-un-mea-culpa-en-jackson-hole/

I mean, we've put people in charge who admit they don't know anything about inflation. And nothing happens.



> The main factors contributing to inflation are:
> - increased costs due to Covid
> - gas prices that finance Putin's war


--- Quote ---Surely you have heard ad nauseam that the current inflation is a consequence of the bottlenecks of the pandemic as well as the war in Ukraine, but it is not the responsibility of politicians or central bankers. Well, in this video you will hear politicians and central bankers that they do have responsibility for it.
--- End quote ---

https://www.youtube.com/watch?v=Km1sBaZjs88

This is a video of a Spanish economist, but it has very instructive cuts of American politicians and central bankers. At 2:27 there is a response from Janet Yellen. At 4:27 there is another interesting break from the head of the FED. At minute 5:41, another entry to frame. Minute 7:31.

jj2007:

--- Quote from: caballero on September 11, 2022, 08:20:46 PM ---> So you can blame Xi Ping and Putin, but the ECB has nothing to do with it

Inflation was already high before the Ukraine war started. Gas prices have risen because Europe refuses to buy gas from Russia (and then cries when Russia cuts it off).

Printing money, without productivity support, always generates inflation.
--- End quote ---

Check this table. You are right, inflation was already 5% when the war started. You can't have a pandemic with lockdowns and half the population staying at home without a massive cost increase, or productivity loss - it doesn't matter how you call the baby. I was actually surprised that the effect showed up with (roughly) a year of delay..

Then came the war. "Gas prices have risen because Europe refuses to buy gas from Russia" sounds plausible but is not quite correct: EU Member States bought happily any amount of gas they could get. Gas prices soared because everybody feared that it would become scarce as a side effect of the war (and Putin plays this card very well).

So, in essence, I stay with my statement that Xi Ping's Covid and Putin's war explain the inflation, and that the ECB (or the FED) had no influence whatsoever. Note that EU inflation was at -0.27% at the end of 2020, and 0.25% for the whole of 2020.

Now the FED and, later, the ECB have raised the interest rates. That is a standard response to home-made inflation ("printing money"), but it fails almost completely at lowering imported inflation, as is the case for gas. What Lagarde says in public to justify that act doesn't interest me. I'd rather know what they plan when it fails, and what it means for some countries with very high public debt such as Japan and Italy. My best guess, however, is that the gas price will be back to normal in about half a year from now.

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