With the raging inflation across the Europe, officials from different levels are keen to find a scapegoat in the ongoing war in the Ukraine and blame it for the insanely crazy numbers:
Christine Lagarde, president of the European Central Bank, is a true source of wisdom:
"Europe is entering a difficult phase. We will face, in the short term, higher inflation and slower growth. There is considerable uncertainty about how large these effects will be and how long they will last for ... The longer the war lasts, the greater the costs are likely to be."
Short term? Hmm... I have the strange feeling that I've already heard this... it's like a deja-vu. Oh yeah, last December for example, when they will still sticking with the transitory crap. Long after even the reckless FED was forced to admit that the inflation is nothing but transitory.
Inflation didn't appear over night with the war. Yes, it was accelerated by it, but the roots can be easily traced only by looking at the gargantuan balance sheet of ECB. Almost 9 trillions euro. Which is mostly government debt of different members, especially the always problematic ones, as Italy, France and Spain.
The extreme circumstances are putting EU institutions and national governments under enormous pressure to deliver fast and tangible solutions for workers and businesses.
What are these fast and tangible solutions?
Spain recently approved an emergency package ... mobilising €16 billion in public funds, including €6 billion in direct support and tax reductions.
Like a lot of countries in EU now, Spain is throwing more money in the inflation fire, money that is obviously collected from ECB. So basically more inflation. ECB cannot print supplies, or food, or natural gas. But they're God damn good at printing money out of the thin air. So, why not?! It's not like they can be held responsible by anyone for their actions.
The only person that is actually speaking truth, but of course, without pointing a finger to the guilty ones, is the president of the Lithuanian Confederation of Industrialists, Vidmantas Janulevičius:
"Russia's invasion of Ukraine will add more fuel to the already flaming bonfire of inflation, and that bonfire could burn up all of Lithuania's economic growth in 2022"
What is ECB saying? Just stupid things, as usual.
"Incoming data don’t point to a material risk of stagflation,"
ECB is currently managing three scenarios for 2022: normal (3.7% growth), adverse (2.5%) and severe (2.3%).
Our baseline projections, which include an early assessment of the impact of the war, don’t foresee a recession, given the euro area’s strong labor market and the fading pandemic
Outdated scenarios, that even in the most severe case is still positive, no possibility of stagflation or recession, everything is good boys and girls, ladies and gentlemen!
And what's the proposed solution?
This is so simple and efficient, that will make everyone end up in tears of joy. Just SPEND MORE!
Two finance ministers, the Dutch one Sigrid Kaag and the Spanish one, Nadia Calviño are calling for a reform that will allow EU states to spend even more money that they don't have. Of course, this needs to be packaged in a nice way so here we go:
...that would enable the public investments needed to implement the green and digital transitions.
The current rules are stating in a nutshell that the annual fiscal deficit must be capped at 3% of Gross Domestic Product and overall government debt no more than 60%. Which are obviously bullshit and ignored for so long by different states. Actually, the 60% limit is ignored for years by a lot of countries.
The European Commission estimates that private and public investments need to increase by €392 billion annually until 2030.
So if we can, every 2 and a half year, add another trillion to the ECB balance sheet, that would be great! Of course, all in the name of fighting climate change, where the experts are predicting the gloomiest future ever. Like they did with the Corona, remember? You have to remember, it was less than a year ago when two tier society based on vaccination was almost bound to happen.
“In the solar sector, we want to go from a hundred and sixty-five gigawatts today--that's roughly powering 50 million households in Europe--to one terawatt,” says Walburga Hemetsberger, CEO of Solarpower Europe.
Being in the solar power business, it's good since the government is shitting free money all over the place. Yeah, we can replace completely the Russian gas. But not at night! Or in the cold winter months when you have no sun. Or even during summer, when it's overcast.
As well as the cost of adapting to live with climate change, investment is also urgently needed to reduce carbon emissions.
Well, with the current fuel prices, we don't have to wait that much too happen. We'll reduce carbon emissions by increasing worldwide poverty.
As Jordan Peterson said, if you want to fight climate change, you have to fight poverty. But we roll the other way around.
