Inflation: how Germany will lead the euro area to permanent depression
Schizophrenia has taken over the Euro area, or at least the only country that really commands, namely Germany. The obvious and banal evidence in two article titles:
The first article clearly explains how inflation, currently at 5% in the euro area, is politically desired, linked to the imposition of CO2 taxes, and which will deliberately lead to a situation of greater poverty understood, literally, as less availability. of goods. All of this specifically wanted by voters who want these kinds of policies, and which, the author admits, will lead to a decade of stagflation (inflation and low growth).
The second article states that the ECB, faced with inflation at these levels, must stop its expansionary policy and start monetary tightening, stopping QE and raising interest rates, especially on bank deposits, bringing them back into positive territory.
So we have, in the same newspaper, side by side, two articles that indicate the destructive pecorso of the euro area economies dictated by German politics, which other countries support without criticism:
- inflation is created with the political instrument of energy taxation: this causes stagflation, but from supply shocks from within, not from outside. That is, prices rise, consumption falls sharply and the economy does not grow, if not actually decreases;
- the increase in inflation accentuates the pressure towards the Central Bank for monetary tightening, which, with the relative increase in interest rates, further compresses the economy;
- the "Combined disposition" of these two elements will cause a long-term and epochal depression, which will inevitably affect the continent's demography, leading it to a long-term depression, from which it will be difficult, if not impossible, to escape.
The failure of growth through the development of alternative energies is already proving to be bankrupt and unable to sustain any kind of economic growth. Those who imposed these policies are well aware of it, but, reading it, it seems that they are acting for a sort of divine, undemocratic mandate. Because I would ask European citizens, through real, free elections, if they really want to pay double or triple the energy by virtue of an effort that will not lead to any real result, rather it will generate the exact opposite, as we are already seeing, that is, to an increase in the production of energy from fossil sources in the world: after all, if a player like the euro area increases the price of energy, without there being any real alternative energy sources, it has had the effect of making more, not less convenient , the extraction of gas and oil. Because the real drama of the German-led Eurozone is that it is led by amateur demagogues, none of whom have made real impact assessments of their choices.
I am telling you these things for information, because you will not be able to affect these processes. No party of the left (apart from Rizzo) has the courage to disengage from these policies. Other forces, who understand the trick, don't have the attributes to break free anyway, at least right now. Anyway, at least, I have explained to you the show you are going to attend, and for which you will pay the ticket.
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The article Inflation: how Germany will lead the Euro area to permanent depression comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/inflazione-come-la-germania-guidera-larea-euro-alla-depressione-permanente/ on Mon, 24 Jan 2022 09:10:51 +0000.