This article suggests that at the very worst time this prop sustaining the good times is about to be knocked away. One more reason to fear that the bubble might burst.
Posted on 06/09/2021 3:07:44 AM PDT by EBH
China's May factory gate prices rose at their fastest annual pace in over 12 years due to surging commodity prices, highlighting global inflation pressures at a time when policymakers are trying to revitalise COVID-hit growth.
Investors are increasingly worried pandemic-driven stimulus measures could supercharge global inflation and force central banks to tighten policy, potentially curbing the recovery.
China's producer price index (PPI) increased 9.0%, the National Bureau of Statistics (NBS) said on Wednesday, as prices bounced back from last year's pandemic lows.
The PPI rise in May - the fastest on-year gain for any month since September 2008 - was driven by significant price increases in crude oil, iron ore and non-ferrous metals, the NBS said.
Analysts in a Reuters poll had expected the PPI to rise 8.5% after a 6.8% increase in April.
Shortly after the inflation data, the National Development and Reform Commission said China will closely monitor price movements of commodities and step up price forecasts to maintain market order.
"The worry is PPI may hover at an elevated level for an extended period of time, which would create economic headaches if mid- or downstream firms fail to absorb higher costs," said Nie Wen, chief economist at Hwabao Trust.
The PPI surge has yet to substantially feed through to consumer inflation, meaning the People's Bank of China is unlikely to worry for now.
(Excerpt) Read more at reuters.com ...
Russia’s high inflation shifts expectations for bigger rate hike on Friday: Reuters poll
https://finance.yahoo.com/news/russias-high-inflation-shifts-expectations-080834979.html
By Andrey Ostroukh and Elena Fabrichnaya
MOSCOW (Reuters) - Russia’s unexpectedly high inflation in May prompted a wide-scale revision of forecasts, shifting market expectations towards a bigger 50 basis-point interest rate increase on Friday, a Reuters poll suggested on Wednesday.
Annual consumer inflation, the central bank’s main area of responsibility, overshot expectations and accelerated to 6.0% in May, reaching its highest since October 2016 when the key rate was at 10%, data showed late on Monday.
Twenty-seven of the 29 analysts and economists polled after the inflation release said the central bank would raise the key rate to 5.50% from 5%...
...”A rate hike of 50 or 75 basis points on June 11 would give an impression that the central bank is panicking,” said Natalia Orlova, chief economist at Alfa Bank.
“Such a sharp rate increase at the second straight meeting would result in an accelerated rise in demand for loans and would itself form elevated inflationary expectations.”
This article suggests that at the very worst time this prop sustaining the good times is about to be knocked away. One more reason to fear that the bubble might burst.
I can see the Biden regime groping around for a solution to runaway inflation and settling on another economic shut down. Blame it on Covid 21 or a climate emergency. The regime might see this as a golden opportunity to implement their climate change global economic reset. I’m afraid we don’t know just how radical these incompetents are, yet.
Don’t forget about the Cyber Polygon Event either.
It may not be a climate crisis or Covid 21. It could be an cyber attack on the banking system that triggers digital controls to the monetary world systems.
When that happens there will be massive dislocations and suffering. Democrats are schooled never to let a good crisis go to waste, indeed, they are so committed to exploiting crises that they will exaggerate them or even create them. I suspect there will be no need to exaggerate the misery to be associated with the reckoning to come.
It might go the way of the Weimar Republic with runaway inflation, it might produce a terrible deflation, it could give us a taste of both and leave us in stagflation. Whatever route taken will be partly the result of a government trying to fix the problem which government has created.
In other words, the problem will be economic but the solution will be political. The Democrats will attempt to interpose a new political system as their solution to a problem they are causing. The consequences of a new political system will not just be a deranged economy, misery, poverty, cronyism but a loss of liberty across-the-board.
When the crunch comes look out for the Civil War and whisper to the children about what used to be called the Bill of Rights and the Constitution.
Ping
I believe there will be a reckoning for those responsible, the current regime and the permanent DC DS/Uniparty Bureaucratic class. People tend to look the other way when they’re investing their free government money in a stock market caldera with unheard of returns. The pressure valve of free elections is the primary reason America has survived relatively intact. The election of Trump is a perfect example of the efficacy of the valve. The “silent majority” pressure builds and is eventually relieved by the election of a Trump or Nixon. The majority of 80 million MAGA voters and many independents now realize that valve no longer exists. A 2008 collapse coupled with a 30+ misery index (to start) and no release valve and an authoritarian, repressive regime? You spoke of the Weimar Republic. As I watched our republic being pi$$ed away, it reminded me more of the collapse of the French Third Republic. It’s not too far fetched to imagine a Vichy USA. A corrupt coastal semi autonomous Chinese client state being utilized by the CCP to exploit Middle America.
The downside of having the dollar as the world’s reserve currency, is that when dollar hyperinflation kicks in, the whole world will feel it.
No doubt the real inflation number is far higher than the officially released a number.
But . . . but . . . I didn’t think commie regimes could have inflation.
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