Europe: Price controls in the pipeline

What we are seeing on the commodity markets these days is a second wave of inflation slowly but surely building up. This wave of inflation cannot be combated with conventional monetary policy, as it reflects increasing shortages in the resource markets. These price increases will be particularly noticeable in economies with low energy and raw material prices, as this is cost-push inflation.

So if the monetary policy response is short in this case, what will those who, like the Europeans, are in the situation of running a fiat currency that is not backed by energy or other resources do? They will literally have to print money to maintain the necessary energy and resource imports to run their economies. And in this inflationary scenario where we are in these markets, there will be rapid spikes in inflation, and they know that very well at the ECB Tower in Frankfurt.

So what is the Europeans' response? In a very detailed paper, the central planners are already pointing out that future waves of inflation will be countered with price controls.

The central planners in Frankfurt and Brussels are thus reaching into the mothballs of socialism and once again not daring to let the free market solve the problem of adjusting price spikes. In the eurozone, we have long since found ourselves in a scenario that must rightly be described as an intervention spiral. One intervention in the market requires the next, central industries such as the energy sector are increasingly being nationalized, state quotas are rising hand in hand with public debt levels and the central rulers feel increasingly compelled to use protective tariffs to protect their own economy, which is being drained by bureaucracy and fiscal burdens, from international competition.

The eurozone is drifting into a stagflationary trap, and Europeans must be prepared for the fact that the level of prosperity we knew will soon be a thing of the past. Europe has been left behind by the world's key economies, the USA and China, and can no longer maintain the high pace of innovation in these regions under this regime.

So soon price controls - then capital controls will be installed to stem the onset of rapid capital flight. Then the real fun begins!

Dulce leche 😋 im not a fan but my mom makes it when the milk goes bad. People in different Spanish places might call it different. #foodstr

@BTCPrague was awesome! Thanks for every Pleb for this great conference.

See you next year!