International events

[Altherion]

On 1/26/2024 at 3:10 PM, Padraig said:

Why?  I understand that it can be inflationary but you make it sound that it is inflationary as a rule (and significantly so, not that is causes a barely measurable blip).

Because it injects money into the economy without any concurrent production of goods or services. It would be different if the handouts were financed by taxes because in that case, the money is being redistributed. However, when the handouts are financed by debt, the government is effectively increasing the amount of money in circulation without having changed anything else.

It's true that as long as the handouts are relatively small in scale or at least constant from year to year, the effects are fairly negligible. However, this is not what happened during the pandemic and everybody wound up paying for it through inflation.

[Padraig]

19 hours ago, Altherion said:

However, when the handouts are financed by debt, the government is effectively increasing the amount of money in circulation without having changed anything else.

Well yes, that is the basic economic theory but it obviously did change other things.  Lots of people would have been sacked or furloughed, and would have no money.  And then they were given some assistance.

When it happened, economists didn't expect this level of inflation would be the result, so I would need to see a lot more evidence to justify any categorical statements about it being the main cause of the recent spike in inflation.  Economists spend most of their time being wrong.

[Kalbear]

The money was injected into the economy with the goal being to offset business closures and firings. It wasn't just money being put in - it was money being put in to counter the money being removed.

Note also that the inflation increased significantly not after covid restrictions were lifted  - they coincided much more strongly with the Ukraine war. Which makes more sense given that that affected supply of all sorts of things far more strongly.

[DireWolfSpirit]

People have foggy memories, point being some of us were already baring witness to inflationary pressures pre-pandemic. The pandemic and responses to just extrapolated the problem. A problem that many economist were warning about as far back as Trumps last round of tax cuts which over goosed an already juiced economy. Trump policy caused the inflation, Biden has brought it back to almost normal levels. Thankfully weve avoided a crash thus far some how.

 

[Rippounet]

1 minute ago, Kalbear said:

Note also that the inflation increased significantly not after covid restrictions were lifted  - they coincided much more strongly with the Ukraine war.

Yup. In France, inflation really quicked off after Europe lost the access to Russian gas. Energy being more expensive had ripple effects through the economy, affecting almost every kind of business.

[Heartofice]

The primary drivers of the inflation problems were the supply side shocks such as Covid and the Ukraine war, but the compounding problem was that demand was high when countries reopened. That demand was partly fuelled by Covid spending as people had more savings to spend.

Really it’s the interaction between supply and demand, and the combination of a lot of factors that is to blame. 

[Zorral]

Delivery and transportation costs are so much higher now, not only because of the price of fuel, but because it takes so much longer.  For example, many ships can't even get through the Panama Canal due to drought-driven water levels, and about 40% of world's shipping goes through the Panama Canal.

Drought Saps the Panama Canal, Disrupting Global Trade
The number of ships that can travel through the vital route has fallen sharply this year because of a lack of water for the locks, raising costs and slowing deliveries.

https://www.nytimes.com/2023/11/01/business/economy/panama-canal-drought-shipping.html

A second example, in the US the costs of train piracy is off the hook.  

The Great Freight-Train Heists of the 21st Century
The explosion of the e-commerce economy has created an opportunity for thieves — and a conundrum for the railways.

https://www.nytimes.com/2024/01/23/magazine/train-robbery-amazon-packages.html

 

[DireWolfSpirit]

Speaking of economics, this Evergrande debt story is scary.

Evergrande, symbol of China’s property crisis, heads to liquidation

From CNN-

"Previously China’s second biggest real estate company, Evergrande defaulted on its financial obligations to creditors at the end of 2021, igniting a crisis in the property sector that continues to weigh on the wider economy. A former Chinese official said last year that China has enough vacant properties to house more than its entire population of 1.4 billion."

Holy smokes theres a loaded gun of potential destruction as the investors get caught in the ramifications of holding that debt.

Edited January 29 by DireWolfSpirit

[The Anti-Targ]

14 hours ago, Kalbear said:

The money was injected into the economy with the goal being to offset business closures and firings. It wasn't just money being put in - it was money being put in to counter the money being removed.

Note also that the inflation increased significantly not after covid restrictions were lifted  - they coincided much more strongly with the Ukraine war. Which makes more sense given that that affected supply of all sorts of things far more strongly.

Technically the only way to remove money is to pay taxes, otherwise in situations like lockdowns its the speed of money that is slowing down, so injecting some money into financial for assistance to firms and furloughed workers speeds up money. Paying off private debt also removes money since that money is only virtual money it was created by the bank making money and anti-money with the money going out into the world and the anti-money sitting in a debt account waiting to be annihilated with the return of the money. So one way to not inject new money into the economy is to slow down or completely halt the destruction of money by having debt and / or tax jubilees.

[maarsen]

8 hours ago, DireWolfSpirit said:

Speaking of economics, this Evergrande debt story is scary.

Evergrande, symbol of China’s property crisis, heads to liquidation

From CNN-

"Previously China’s second biggest real estate company, Evergrande defaulted on its financial obligations to creditors at the end of 2021, igniting a crisis in the property sector that continues to weigh on the wider economy. A former Chinese official said last year that China has enough vacant properties to house more than its entire population of 1.4 billion."

Holy smokes theres a loaded gun of potential destruction as the investors get caught in the ramifications of holding that debt.

I suspect that the worldwide runup in real estate prices before Covid is a direct effect of knowledgable investors getting out of Evergrande before the extent of the insolvency was known. I imagine there are shortsellers who have made a large fortune shorting the stock.

[DireWolfSpirit]

Lots of headlines over China regulating short selling right now after recent steep market declines. The former head of Evergrande also locked up as the State investigates his actions.

[Conflicting Thought]

43 minutes ago, DireWolfSpirit said:

Lots of headlines over China regulating short selling right now after recent steep market declines. The former head of Evergrande also locked up as the State investigates his actions.

at least they are taking steps in the right direction. and getting such a big "player" behind bars (for now at least) is something that i wish happend everywhere

[A Horse Named Stranger]

Well, in China they usually do that, when you fall out of favour with Winnie The Pooh and his posse. Or if you mouth off publicly. Ask Jack Ma, if you can get him to talk about his missing months.

[Kalbear]

11 hours ago, The Anti-Targ said:

Technically the only way to remove money is to pay taxes, otherwise in situations like lockdowns its the speed of money that is slowing down, so injecting some money into financial for assistance to firms and furloughed workers speeds up money. Paying off private debt also removes money since that money is only virtual money it was created by the bank making money and anti-money with the money going out into the world and the anti-money sitting in a debt account waiting to be annihilated with the return of the money. So one way to not inject new money into the economy is to slow down or completely halt the destruction of money by having debt and / or tax jubilees.

 Sorry if I was imprecise with monetary jargon; by removing/adding money I was talking about the actual rate of spending, not the supply of currency. My attempted point was simply that the pandemic caused a great number of people to potentially be out of work and a bunch of businesses to close; the money that was put in by the government was replacing those lost wages and lost spending from those businesses. It was not just adding more overall capital to the system. As it turned out it probably did - largely because most of the money went to businesses and many of those businesses didn't need it or use it as intended - but definitely not to a 1:1 ratio. And that's in the US, I would imagine countries with more robust work protections were better off in that way. 

[Conflicting Thought]

22 minutes ago, A Horse Named Stranger said:

Well, in China they usually do that, when you fall out of favour with Winnie The Pooh and his posse. Or if you mouth off publicly. Ask Jack Ma, if you can get him to talk about his missing months.

or like when you deserve it, like in this case.

[Zorral]

Farmers Block Traffic Near Paris Before Prime Minister’s Speech
The protesters are angry about subsidies, environmental regulations and foreign competition, with demonstrations now into a second day. So far, government attempts to ease the tensions have failed.

https://www.nytimes.com/2024/01/30/world/europe/france-farmer-protests-macron.html

Quote

 

.... On Thursday, Mr. Macron is scheduled to attend a European Union summit in Brussels, where he is expected to lobby on behalf of French farmers.

Many of them, for instance, are opposed to a free-trade agreement currently being negotiated between the bloc and Mercosur, an alliance of South American countries, because they say there not enough guarantees that those countries will have to apply the same environmental and sanitary standards as European farmers. France has long opposed the deal under its current form, but French farming unions want it to be scrapped entirely.

 

French Farmers Lay ‘Siege’ to Paris in Growing Standoff
The authorities warned residents to brace for disruptions as farmers converged on the capital to press a wide range of grievances.

https://www.nytimes.com/2024/01/29/world/europe/france-farmers-protests.html

Quote

 

.... Irate farmers deployed tractors to block the main roads in and out of Paris on Monday, in an intensifying standoff that has left the capital girding for disruptions and has become the first major test for France’s newly appointed prime minister, Gabriel Attal.

Last week Mr. Attal rushed to farming regions in the south of France and offered a series of rapid concessions as he tried to head off widening demonstrations on roadways from farmers nationwide. But the steps failed to appease many of them.

Many farmers complain that imports are undercutting their livelihood, that wages are too low, and that regulation from both the government and the European Union has become suffocating.

But their concrete demands are so varied that the protests present an increasingly precarious moment for the government, one that defies easy solutions. ....

 

 

[Rippounet]

1 hour ago, Zorral said:

Farmers Block Traffic Near Paris Before Prime Minister’s Speech
The protesters are angry about subsidies, environmental regulations and foreign competition, with demonstrations now into a second day. So far, government attempts to ease the tensions have failed.

Yeah, not a fan of the movement. The main farmers' union (the FNSEA) tends to rant about environmental regulations rather than about the costs of "conventional" (i.e. technological and chemical) agriculture (ironically, supported and half-imposed by the FNSEA itself) and the way supermarkets drive the prices down for farmers.

A different way to put it: there's a system in France in which the main farmers' union, supermarkets, and large trans-national corporations all cooperate to push individual farmers to develop an agriculture based on mechanization and (pretty nasty) chemical products, designed to produce as much food as possible while disregarding the environmental damage or the quality of the food. The system entails a lot of debt for individual farmers (neither the machines nor the chemicals are cheap) and thus very small salaries. It also entails a lot of health problems on the national level, which has been very well documented by activists and journalists at this point.
When the EU pushes for environmental regulation, it threatens the entire system and pushes individual farmers' salaries below the minimum wage. There's a very high rate of suicide among farmers because of that.
But instead of attacking the trans-national corporations or supermarkets' profits, the FNSEA attacks... regulations. Often with the complicity of the government(s), that can then say "Well, see, we did our best, but our country just isn't ready to go green..."
There's an argument there that if you want to regulate agriculture you don't respect the farmers' work ("They grow your food"), which is not just fallacious, but absolutely moronic.

And I would pity the individual farmers, because most of them are hostages to a system. But in truth, it's not uncommon for farmers belonging to the FNSEA to threaten or attack farmers or activists/journalists linked to the alternative union (the "Confederation") pushing for the government to help farmers transition to agroecology. There's been a lot of cases of that, because these guys hate environmentalism.
In others words, a lot of these guys currently "laying siege" to Paris also do so because they reject the imperatives of the ecological transition and despise the "urban elite" in Paris that -to their eyes- don't care about them and even look down on their work. In other words, a lot of these guys are pretty close to the far-right - not unlike what happened in the Netherlands, I believe.
So in my case, this becomes a kind of self-fulfilling prophecy, because I do end up looking down on these morons, actively fighting to protect a system that exploits them through debt and wage slavery. Seriously, fuck 'em. Bloody idiots.
OTOH, members of the Confederation, currently targeting the supermarkets (rather than Paris ) have my full support. These guys are smart and know what they're doing.

[Zorral]

These farmer protests have spread to Greece and Italy.  And Romania!

https://www.theguardian.com/environment/2024/jan/31/eu-delays-biodiversity-rules-amid-rising-protests-from-farmers

 

[Corvinus85]

15 hours ago, Zorral said:

These farmer protests have spread to Greece and Italy.  And Romania!

https://www.theguardian.com/environment/2024/jan/31/eu-delays-biodiversity-rules-amid-rising-protests-from-farmers

 

It's been going on in Romania for weeks. A lot of it do with the tariff exemption of Ukrainian produce, while their taxes are high. They even tried to block some of the border crossings.

[Zorral]

Sweden: Where it's taboo for dads to skip parental leave

https://www.bbc.com/worklife/article/20240130-sweden-where-its-taboo-for-dads-to-skip-parental-leaveI

Quote

 

t's been 50 years since Sweden introduced state-funded parental leave, designed for couples to share. The pioneering policy offers some surprising lessons for other countries.

Kjell Sarnold has a glint in his eye as he describes fond memories of his parental leave in the 1970s. His son was eight months old, and they bonded during a balmy September when his employer granted him four weeks off work on 90% of his salary – paid by the state – while his wife returned to work full-time.

"We went out for a lot of walks. I had one of those baby carriers on my back. We were outside all the time," says Sarnold, who was living in Stockholm's archipelago at the time. The period also involved changing countless nappies, lots of cooking and learning to comfort his son when he was upset. But on the whole, Sarnold loved it.

He doesn't work for a progressive start-up or a global corporation ramping up its employee experience policies. He's now a 74-year-old retired car mechanic, and his memories are from five decades ago, soon after Sweden became the first country in the world to introduce 180 days of state-funded parental leave that wasn't gender-specific. The idea was it could be shared between couples as they saw fit, giving the same rights to fathers and mothers.

 

Have seen folks declaring they hate socialism with all their being.  Why?