Monday, March 14, 2022

"Catastrophic Inflation: 'I’ve Never Seen Prices Jump This High, This Fast'”

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"Catastrophic Inflation: 
'I’ve Never Seen Prices Jump This High, This Fast'”
by Epic Economist

"The U.S. economy is heading to an inflationary collapse of catastrophic proportions. What we’re witnessing right now are just the very early stages of that meltdown. The road will only get bumpier from here. Last week, official agencies reported that consumer prices have jumped 7.9% in February compared to one year ago, breaking the previous record set in January and marking the highest rate of inflation in 40 years. Of course, if you watch our videos on a regular basis, you already know that the reality is much worse than it seems.

Over the past seven days, the average price of a gallon of gasoline in the U.S. went up by 13 percent, and compared to a year ago, gasoline prices soared by an impressive 38 percent. And now that the conflict is threatening to disrupt global energy exports, Americans will have to cope with skyrocketing energy prices all across the board. Drivers are already facing sticker shock at gas stations all over the country, but there are many other ways in which higher global energy costs can ripple through the economy. For example, there have been reports of airlines reducing the number of flights due to soaring fuel costs. Meanwhile, truckers are adding fuel surcharges to be able to deliver goods across the nation. During an interview, one trucking company executive was asked about the current state of affairs and the impacts of rising fuel prices, and he said that this situation is extremely distressing for both customers and service providers.

“Customers really don’t want to hear it, but fuel prices are going through the roof so we’re having to charge more,” said John Migliorini, vice president of Lakeville Trucking in Rochester, N.Y., where diesel costs have nearly doubled to about $400,000 a month. “What choice do we have? I’ve never seen prices jump this high, this fast.” And he is absolutely right. A new study released by the UN, analysts warned that global food prices could soon face another double-digit spike. This is really devastating news for the billions of people that are already living in poverty all over the planet. Last month, food prices had reached another record due to high demand, input and transportation costs, and port disruptions. The new price increases mean that the global number of undernourished people could surge by eight to 13 million people in 2022, according to FAO. As a result, grocery prices are going to get a lot more expensive. At the end of the day, consumers end up paying for the crises caused by global leaders.

Meanwhile, our own economic conflict with Russia continues to get worse. The U.S. government has launched a series of economic sanctions on Russia, and they’re causing severe damages to the Russian economy. But ours is going to be impacted just as well. Palladium and neon are two resources that are key to the production of semiconductor chips. And considering that Russia supplies over 40 percent of the world’s supply of palladium and Ukraine produces 70 percent of the global supply of neon, the global semiconductor shortage is going to become even more acute in the coming months. We cannot underestimate the seriousness of this shortage. Semiconductors are essential components of industrial machinery. Without them, it’s not possible to make those types of equipment operate properly. So if that shortage aggravates even further, our domestic manufacturing is going to significantly slow down as companies are forced to shut down factories, leading to mass lay-offs and billions in losses.

And this is just one way out of hundreds that our economy is going to be impacted by the sanctions imposed on Russia. Most Americans do not understand how terrible conditions will become if this conflict persists for an extended period of time. At this point, we should hope for the best but prepare for the worst because the things we’re watching play out right in front of our eyes may be the events that change modern life forever."

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