Global markets continue to be rattled by the ongoing conflict between Russia and Ukraine. However, this is the easy scapegoat for what truly ails the markets – easy money. Governments and central banks injected trillions of dollars into the world economy. Their excuse then, and justification for such actions was the pandemic. Now as the pandemic is seemingly coming to an end, they have a boogeyman to blame for supply chain disruptions, higher prices, etc – Russia. It is almost too coincidental, don’t you think? Several major global stock markets have given back all of their pandemic gains. It only takes a few short months, sometimes even weeks, to erase a year or years of gains. This is a direct result of markets having been juiced by cheap money. It wasn’t real. It was a bubble. As such, it can collapse easily and that is what is unfolding now. However, governments, central bankers, and other policymakers are not going to take responsibility for their actions. Thus, they will look for any and all excuses possible. Now, it’s the pandemic and Russia. What will be next?
As is highlighted in today’s podcast, global trade is discussed and how countries the world over will likely engage in hoarding their goods that are typically exported. This past week, Hungary announced that they are stopping the exports of grain products. Russia and Ukraine account for nearly 25 percent of the world’s wheat production and 20 percent of global corn production. Also this week, President Putin of Russia, reached out to fertilizer companies, basically instructing them to slow or stop the export of fertilizers. Russia and Belarus, an ally of Russia, are two of the largest fertilizer producers in the world. If they were to stop exporting, global food prices, which are already at or near all-time highs, will get even higher. Revolutions are fought on empty stomachs. We witnessed the Arab Spring only a decade ago. Rising global food prices were a major factor in that movement. Now with even more debt, higher food prices, a pandemic, and energy prices at levels also not seen for several years, sets the stage for a lot to go wrong in short order. Such protests, riots, strikes, revolutions, should they occur, will only exacerbate the current situation. Further disruptions to supply chains, less production of goods, fewer exports due to restrictions and/or lack of production – all of which translates into higher prices for the basic necessities. Stay diversified, stay vigilant, and stay with The Kapital News. #Commodities #Gold #Silver #Recession #Peace #FoodPrices #Revolution #Protests #Russia #Ukraine #USA #Liberty #Stagflation #Inflation