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Fed raises rates to fight against "NATO's/Biden's price hikes"
“The U.S. banking system is sound and resilient,” the Fed said. “Recent developments are likely to result in tighter credit conditions for households and businesses and to weigh on economic activity, hiring and inflation. The extent of these effects is uncertain.”
Destroying our economy is not the best answer to inflation. More production is a better answer.
Exactly right cutworm!
NATO's war with Russia has been the biggest reason for global and US inflation!
1. Energy prices higher because of it
2. Food shortages and prices higher because of it.
3. Fertilizer shortages made worse and food prices higher
https://www.csis.org/analysis/russia-ukraine-and-global-food-security-one-year-assessment
Nonetheless, the invasion is worsening malnutrition for millions and delaying the provision of humanitarian assistance for those suffering the worst forms of food insecurity.
since Russia invaded Ukraine, 84,200 pieces of agricultural machinery have been totally or partially damaged, four million tons of grains and oilseeds have been destroyed or stolen, and storage for 9.4 million tons of agricultural products has been damaged or destroyed.
While the total value of damages to Ukraine’s agriculture sector exceeds $6.6 billion, the total value of losses—the foregone agriculture-based revenue due to these damages—reaches $34.25 billion. According to MAPF and KSE, Ukraine suffered $11.2 billion in crop losses in 2022 and expects to absorb $3 billion in losses in 2022–2023 winter crops.
Nonetheless, the war has affected the global price of fertilizers through higher prices of natural gas, an important feedstock for nitrogen-based fertilizers. Despite carve-outs for agriculture, some firms have been wary of doing business with Russia, resulting in reduced exports, particularly of fertilizers, with Russia’s exports of anhydrous ammonia hit particularly hard.
As a result, though fertilizer prices have retreated from their spike around Russia’s invasion, prices for all forms of fertilizer—nitrogen, phosphate, and potassium—still remain 80 to 100 percent above 2020 levels.
Today, WFP reports that a record 349 million people across 79 countries face acute food insecurity. This all-time high represents an increase of 200 million people compared to pre-Covid-19. In February 2023, the heads of the FAO, WFP, International Monetary Fund (IMF), World Bank Group, and World Trade Organization together warned of “an unprecedented shock to the global food system, with the most vulnerable hit the hardest.
First, though Russia’s war in Ukraine has reduced exports of grains and oilseeds, it has affected consumption of other, more nutritious foods.
A recent analysis from the International Food Policy Research Institute (IFPRI) illustrates this phenomenon. Prior to the war, Egypt, the world’s largest importer of wheat, procured about 85 percent of its wheat imports from the Black Sea. War-related supply chain disruptions and other factors have led to more than 30 percent increase in domestic food prices.
President Biden reiterated U.S. commitment to support African countries’ efforts to improve food security. Treasury Secretary Janet Yellen reiterated these messages in her January trip to Senegal, Zambia, and South Africa. On Tuesday in Poland, President Biden accused President Putin of trying “to starve the world, blocking the ports in the Black Sea to stop Ukraine from exporting its grain—exacerbating the global food crisis that hit developing nations in Africa especially hard.
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NATO/BIDEN: Stop all this disingenuous bs and do the one substantive thing that will end all this additional food, energy and inflation adversity in it's tracks. Stop the killing. Stop the decimating of Ukraine.
Agree that Ukraine will NOT become a NATO country and Putin will get out of Ukraine.
He never would have entered if you diabolical leaders weren't so obsessed with your political agenda at the expense of human beings.
I agree that Putin should be held accountable for his war crimes. However, we are making hero's out the leaders taking positions that are intentionally causing it to happen in order to have a NATO war against Putin, that they hate.
Yellen is totally enabling and covering this up. Reacting by increasing interest rates.
The same person that said abortion will hurt the economy isn't able to comprehend the crystal clear economics above that are the root of much of this GLOBAL inflation???
metmike as I watched Putin shaking hands with Xi I was thinking that China will wind up treating Russia like Russia treats Ukraine/Georgia. No way China has forgotten the territory taken by Russia when China was weak.
Liquidity Crisis Hits Major European Banks as a Dollar Shortage Threatens the Global Banking System
HE'S PURRRRRRRRRTTY SMART, IMO
Jean,
Thanks much!
This guy is excellent.
But nobody is telling us the real reason and what the solutions are.
End the war in Ukraine by agreeing with Putin that Ukraine will not join NATO.
End the war on fossil fuels based on a manufactured/fake climate crisis.
Instead of ending the things causing the most amount of inflation, they just keep jacking up interest rates so they can pretend the MUCH BIGGER factors are not really causing inflation.
The Biden/NATO price hike along with the fake green energy price hikes.
All obvious and preventable.
Blaming Putin for the supply side penalties from the war(food, energy, fertilizer), blaming Trump for not having regulations that would have somehow, prevented 1,550 dumb woke investments, especially in fake green energy that will NEVER replace fossil fuels is just using them as scapegoats.
This SHOULD HAVE been prevented with totally rational energy and political decisions.
Would have saved many hundreds of thousands of lives.
Would have saved a trillion in damage to Ukraine.
Would have saved trillions in inflation to the world.
Instead of ever realizing this, they keep doubling and tripling down with no plan to end the war.
The chance of them ending the war on fossil fuels?
Near 0%. They WANT the developed world's economy to crash. That's one of the key objectives. Why would they adjust? This is the plan to re-balance global wealth.
Science corruption
https://www.mScience corruptionarketforum.com/forum/topic/93926/
I've been stating that this would happen when they impose this green energy for a decade.
This is as far as the current forum goes back:
By metmike - Dec. 31, 2017, 1:36 p.m.
https://www.marketforum.com/forum/topic/508/#624
Instead of getting their doo doo together and uniting to oppose all these really bad things, Rs in our country are being misled and controlled by 0 credibility sources using them for self serving agenda.
This past week, for instance, Rs used their outrage to focus on supporting the person who has done more damage to his own party in political history, Donald Trump.
Democrats are against republicans and republicans are against the best interest of the republican party when it comes to Trump.
One of the worst consequences of the US raising interest rates is the devastating impact of interest on the massive debt:
Our country is drowning in catastrophic debt and we are flushing hundreds of billions down the toilet in counter productive causes halfway around the world, one in particular thats killed hundreds of thousands and will require 1 trillion from the US for rebuilding.
The Congressional Budget Office (CBO) just released updated budget and economic projections, which highlighted the nation’s unsustainable fiscal outlook. One of the most significant findings from that report is that the federal government’s borrowing costs have increased rapidly over the past year and will grow through the next decade. Most notably:
Rising interest payments can crowd out other priorities in the federal budget and lead to a cycle of higher deficits, growing debt, and even more interest payments in the future.
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Some/much of the higher interest rate hikes causing this, from the Fed are to control the inflation that the Ukraine war caused from the massive, global supply side dynamics resulting from energy and food disruptions.
No problem-o. Just call it "The Putin price hike" and pretend we didn't play any role.
Just like this weeks conflict with Taiwan is all China's fault. They forced McCarthy to insist on the Taiwanese president coming to the US to have personal meetings with him.
Then, when/if China reacts, it will have nothing to do with anything the US caused/did.
Just think about all the good things that all that money used to obliterate Ukaine and kill their people(and Russians) could have done for our people/country!!!
Or to help the really needy/poor people in the world.
We are wasting our money/resources and killing our country and the only entity benefiting is the military industrial complex........which lavishes lobby and contribution bribes to the corrupt politicians to keep it going.
https://www.marketforum.com/forum/topic/94068/#94116
https://www.marketforum.com/forum/topic/94068/#94117
The saddest thing of all is how this was so avoidable. Joe Biden's war with Putin was so avoidable.
We can see hundreds of thousands dying needlessly, including 22,000 civilians in Ukraine as their country get's decimated to the tune of 1 trillion dollars....with the US increasing our debt to fund their killing machines, then even more to fund their rebuilding after that war. Because "it's just Ukrainians dying, not Americans" the convincing diabolical war propaganda from our military industrial complex controlled, corrupt politicians in collusion with the dishonest, ratings driven media has bamboozled us.
However, it goes far outside of Ukraine. The entire world is being punished with widespread global inflation from the Ukraine war. Especially from energy and food supply shortages. Hurting the poor nations the most.
There was also a doubly whammy. A green energy law passed in 2020 forces all ships(which transport 80% of the worlds goods) to either use very low sulfur diesel instead of the cheaper high sulfur diesel or to use expensive scrubbers to take the sulfur out of the cheaper fuel.
https://www.marketforum.com/forum/topic/94386/#94410
50% of the cost of transporting goods by ship is the cost of the fuel. Much more than that when fuel prices go up.
Very low sulfur fuel is always more expensive than high sulfur fuel. The ratio has changed with time. When COVID hit in 2020 prices crashed and their wasn't that much difference in price between the 2 fuels. After the invasion of Ukraine, the cost of both fuels spiked to extreme records highs with the low sulfur fuel price almost 5 times higher at its peak compared to the COVID low.
So there was an assumption that compliance with the new IMO rule would go down. We should note that high sulfur gas is still being used by ships with scrubbers.
During the last year, prices have slowly dropped back to pre war levels and pre COVID prices but with a pretty steep premium for the VLSFO price. With fuel prices being 50% of the cost for shipping, using the more expensive VLSFO clearly would contribute towards global inflation.
We didn't notice the impact in 2020 because of COVID, then the war caused the unsustainable spike but now, this new law will continue to put serious upward pressure on GLOBAL inflation because most of the worlds goods are transported over the oceans with ships.
·
https://www.freightwaves.com/news/ship-fuel-cost-down-from-war-peak-but-green-fallout-looms
Clarksons estimates that Capesize bulkers with scrubbers earned $4,400 per day more than nonscrubber Capesizes as of Friday. In July, the premium was $18,000 per day, over four times higher.
As of Thursday, bunkering with LNG was 62% more expensive than with HSFO. That’s actually minimal compared to the spread in the recent past. Since October 2019, LNG bunker prices have, on average, been more than triple HSFO prices in Rotterdam, according to Ship & Bunker data.
If that's not enough, soaring shipping costs took place after COVID hit, despite fuel prices temporary crashing lower because of the demand collapse from COVID. Keep in mind that the inflation below is just for shipping costs.
Studying data from 143 countries over the past 30 years, we find that shipping costs are an important driver of inflation around the world: when freight rates double, inflation picks up by about 0.7 percentage point. Most importantly, the effects are quite persistent, peaking after a year and lasting up to 18 months. This implies that the increase in shipping costs observed in 2021 could increase inflation by about 1.5 percentage points in 2022.
So what is Janet Yellen's position on this key, indisputable law of supply and demand taking a toll on the entire world with higher inflation, especially energy and food which is hurting the poor countries that can't afford it the most but also having a domino affect in the US. Higher interest rates are collapsing some banks and threatens to turn systemic.
Her position is to blatantly deceive us about these reasons for inflation to Americans and instead play pure politics and be a cheerleader for the war in Ukraine.
She is a blatantly corrupt, political puppet that is wrecking our country using horrible judgment justified by lies.
The speech below, made by anybody, is jaw dropping ignorance and deception but considering her position, it's off the charts destructive to the US economy because this is the person with the most power to control policies that have the biggest impact on our economy.
Remarks by Secretary of the Treasury Janet L. Yellen in Kyiv, Ukraine
February 27, 2023
https://home.treasury.gov/news/press-releases/jy1305
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Yellen's job is to analyze the economic impacts of global and domestic dynamics on the US economy. Then, take actions (corrective) based on creating the best environment possible and give advise to others to position our economy to be successful.
She proves in this speech above that she is just a political mouthpiece for the Biden administration's war with Putin and grossly negligent in the most egregious way when it comes to doing her job as the Secretary of the Treasury.
Make no mistake, this is Joe Biden's(US military industrial complex) war with Russia. Yellen and Zelensky are his puppets.
This was demonstrated above with regards to Yellen.
This is the proof of it with regards to Zelensky:
https://www.marketforum.com/forum/topic/94397/
That is the ONLY reason that Americans are buying into the blatant false war propaganda. It has caused us to completely empty our heads of humanity for the poor Ukrainians and be unable to see the damage being done to our own country and the world and instead have our heads filled with hate for Putin that overwhelms common sense and completely ignore the stone cold catastrophic facts above.
The no war in Ukraine option was always there but it required agreeing with Putin that Ukraine would not become part of NATO.
The authentic lesson that Biden doesn't understand here is called NEGOTIATIONS 101!
Zelensky understood that when he campaigned and got elected on negotiating with Russia to bring peace to Ukraine. He was working towards that too.
After Biden took office, Zelensky did a complete turnaround and suddenly insisted on being fast tracked into NATO and told Putin to shove his negotiations.
Only 1 possible explanation for that.
He was bought out by this corrupt administration/Biden using him as a puppet to take out Putin.
In addition, our politicians have an unholy alliance with the military industrial complex that bribes them with lobby and other funding.
That is THE ONLY entity benefiting tremendously from this heinous war.
Of course Putin is evil and should never have invaded Ukraine but we had the total power to make the 1 concession that he wanted to avoid this massive invasion.
Biden left 1 war quickly in the Middle East in 2021 and immediately after that hijacked Zelensky's brain and STARTED A NEW WAR IN UKRAINE. Here's the evidence:
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https://www.cnbc.com/2019/12/10/russia-and-ukraine-agree-to-ceasefire-by-the-end-of-2019.html
Key Points
One of Zelensky's two main promises was to bring the war to an end, a goal that polls have shown Ukrainians want to see accomplished more than anything.
Nevertheless, says Volodymyr Fesenko, director of the Kyiv-based Penta Center, Zelenskiy has found ways to make some progress. The meeting between Zelenskiy and Putin alone was a positive sign, since "the negotiation process to resolve the conflict in the Donbas had been at a dead end for three years."
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What the hell happened to Zelensky 1 year later for him to suddenly do a Dr. Jekyll/Mr. Hyde going from working towards peace to an "up yours Putin! Negotiations are over! We're joining NATO, go ahead and invade"?
BIDEN GOT ELECTED and bribed this corrupt man who abandoned his key election promise and betrayed his people.
Joe Biden was VP in charge of Ukraine corruption during his tenure and knew from experience, exactly how to exploit Ukraine corruption to get what he wanted. He even arrogantly bragged about it!!!
Joe Biden's 2020 Ukrainian
nightmare
. https://www.congress.gov/116/meeting/house/110331/documents/HMKP-116-JU00-20191211-SD067.pdf
This is Joe Biden's war with Putin. He abruptly ended peace talks between Zelensky and Putin that you can read about above by turning Zelensky into his puppet, that obeys his demands, just like he did in the story above.
Now, looky, looky at what the US is doing.
Only this time, it's 100+times the billion dollars in his story above but the big pay off for Zelensky, as promised has been elevating him to become a NATO hero and super star.
Working for NATO and Joe Biden at the expense of his country and people.
In addition, Yellen should be taking actions to give the rest of the world confidence in using the US dollar as the main global currency.
It's been the exact opposite.
Killing the US dollar in global markets
Started by metmike - April 4, 2023, 11:22 p.m.
https://www.marketforum.com/forum/topic/94351/
The United States, using the US dollar as an instrument to punish a country over a political disagreement is viewed by many countries as a blatant, arrogant abuse that presents a high risk to any country that disagrees with US politics.
Read more: https://finance.yahoo.com/news/us-bank-lending-slumps-most-210839551.html
Why am I talking up the risk of an imminent recession?
My concern is so much of what Biden has done to date has made things worse. As inflation rose, Biden passed the misnamed “Inflation Reduction Act“, pouring fuel on the inflation fire. The Biden administration remains committed to wrecking the USA’s extractive industries, with nuisance bureaucratic attacks, permit cancellations, excessive regulation, and lease auction suspensions, deferrals or cancellations. And their blanket guarantee of bank deposits, while reducing the risk of further bank runs in the short term, has increased moral hazard and the risk of large scale resource misallocation, by leaving badly managed banks which should be allowed to fail in the hands of incompetents and criminals.
At every economic inflexion point I can think of, the approach of the Biden administration has been short term and reactive rather than strategic. For example, their decision to drain just under half the strategic oil reserve, without doing anything substantial to improve US oil production and energy security, lowered pump prices a little in the short term, but did nothing to address the underlying problems.
It is not too late. If the US government pulled back on excessive spending, stopped sucking bond markets dry with their debt funded climate extravagances, and did everything in their power to ease restrictions on drilling, to lower the cost of energy and defuse the ticking inflation bomb, confidence could be restored. The US economy might be able to grow its way out of the inflation trap, without raising interest rates and taxes to economy killing levels.
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Not to mention Biden's war in Ukraine that has induced a supply side global inflation crisis because of the loss of energy supplies in the market(most of it intentional) and food production.
In addition, a new green energy law requires ships (that account for 80% of commodity movements around the globe) to burn very low sulfur diesel fuel which costs MORE than high sulfur fuel(or use scrubbers) has added an additional, across the board increase to commodity prices.
The poor countries are especially being crushed by this.
Ship fuel cost way down from war peak, but ‘green’ fallout looms
https://www.freightwaves.com/news/ship-fuel-cost-down-from-war-peak-but-green-fallout-looms
How Soaring Shipping Costs Raise Prices Around the World
So now we're celebrating because inflation is just 5%.
The most effective way to fight global and US inflation would be to end the war. Negotiate for peace. It's eventually going to happen. Why kill hundreds of thousands of people, decimate Ukraine, punish global consumers to the tune of trillions, worst hit, the poor, risk WW-3 and wreck US credibility while creating new enemies....... to determine whether Ukraine can be part of NATO or not?
The FED is totally messed up in their approach.
This is GLOBAL inflation because of supply shortages in energy and food, mostly from the war in Ukraine between the US and Russia(using Ukraine and Ukrainians for the battlefield). They are punishing the US economy by raising interest rates and doing 0 to address the real problem........ GLOBAL, supply side dynamics.
In fact, Yellen is one of Biden's biggest cheerleaders, supporting the war. How can she not know the real reason for much of the US inflation........the same as the inflation in all the other countries.
Take Europe for example:
https://www.ecb.europa.eu/press/blog/date/2023/html/ecb.blog20230224~3b75362af3.en.html
Euro area HICP inflation and HICP food inflation with sub-components
(panel a: annual percentage changes and pp contributions; panel b: annual percentage changes)
Sources: Eurostat and ECB staff calculations. Latest observation: January 2023.
As food production is quite energy intensive, the high rates of food inflation reflect in part the indirect and lagged effects of high energy prices, for which the war has played a key contributing role.
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80% of the worlds goods are shipped across the oceans and diesel prices spiked to record highs. The cost of fuel, is over 50% of the cost of shipping. A new law from the fake green camp requires ships to burn very low sulfur diesel(or use expensive scrubbers) which is higher priced than the cheaper high sulfur diesel.
https://www.marketforum.com/forum/topic/93972/#94414
Also, almost all the worlds fertilizer is synthetic and made with natural gas. When natural gas prices spiked, so did fertilizer prices........which gets penciled into production costs for farmers that get passed on to consumers.
Another secret about fossil fuels: Haber Bosch process-fertilizers feeding the planet using natural gas-doubling food production/crop yields.
https://www.marketforum.com/forum/topic/39215/
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https://www.statista.com/statistics/1278057/export-value-fertilizers-worldwide-by-country/
