The worst in the economy may follow – recession, hyperinflation, energy crisis, food crisis and extreme poverty; a financial Armageddon ready to erupt.
The nightmarish past warnings of economic analysts for a rampant inflation have become a reality. For years there have also been warnings of an impending global energy crisis. Now everything is here in a collective gift set.
In a vortex
But all this seems to be the tip of the iceberg. The shortages of goods recorded will worsen. Many of the paradoxically high prices will look like opportunities by the end of the year.
The CEO of Goldman Sachs has just told us that “there will be more difficult economic times ahead of us”, and not a single party is exaggerating.
Gas prices in the United States reached a new high, just one day after the record, as seven States exceed $ 5 a gallon as inflation soars.
The national average jumped four cents overnight, leaving drivers in even greater despair as gas prices continued to soar as their wallets emptied.
Robert McNally, chairman of the Rapidan Energy Group and former energy adviser to President George Bush, said prices rose on Thursday (2/6) because OPEC’s move was “more symbolic than fundamentally significant.”
“I would not say it drop in the bucket. It’s basically a gesture; symbolically important,” he told CNN Business.
What we really need are long -term solutions and they are not on the horizon. And the truth is that we are not just facing an oil crisis. At this stage, the imbalance between supply and demand has reached a turning point for all traditional forms of energy at the same time.
Greater than the 1970s crises – It will last longer
“We now have an oil crisis, a gas crisis and an electricity crisis at the same time,” Fatih Birol, head of the International Energy Agency ‘s monitoring team, told Der Spiegel in an interview published this week.
“This energy crisis is much bigger than the oil crises of the 1970s and 1980s.
And it will probably last longer.”
The world economy has largely been able to withstand rising energy prices so far.
However, the prices could continue to rise to unsustainable levels.
Shortages due to supply problems could lead to some difficult choices in Europe, including the ticketing measure.
Destruction of the European economy
We have never encountered anything like this before, and one industry expert refers to it as a “perfect storm.”
“We have a serious problem around the world that I think policymakers are just seeing.” It’s kind of a perfect storm”, Joe McMonigle, whose team acts as an intermediary for energy producing and consuming countries, told CNN in a telephone interview.
Isn’t it a coincidence that this term appears all the time?
Another element of the “perfect storm” we are facing is the accelerating growing global food crisis.
In the United States, the bird flu pandemic that broke out in 2022 resulted in the extinction of 38 million chickens and turkeys. As a result, the price of eggs has skyrocketed. UDSA forecasts an increase of between 19.5% and 20.5% on an annual basis in 2022.
Chicken and turkey will also be priced and now warn us that shortages are coming.
In fact, the CEO of Hormel Foods openly tells us that “the big supply gaps in the Jennie-O Turkey Store will start in the third quarter”.
A leading American food processing company warned of an impending shortage of turkey products in supermarkets after a of the worst cases of avian influenza.
“Our team at the Jennie-O Turkey Store is facing an uncertain period ahead,” Hormel Foods Corporation CEO Jim Snee told investors in a profit call.
“Similar to what we experienced in 2015, (bird flu) is expected to have a significant impact on poultry supplies in the coming months.”
Snee said that “the big supply gaps in the Jennie-O Turkey Store will start in the third quarter”. He said bird flu was confirmed in our “supply chain” in March.
In case you did not understand the meaning of what he was saying, “big supply gaps” are a politically correct way to say “extended shortages”.
Speaking of shortages, the shortage of infant formula in the United States is now worse than ever. 130,000 stores and Datasembly followed. Ten states now have a deficit rate of 90% or higher, with Georgia hit hardest at 94%.
Baby milk was imported from Europe, but once again it turned out to be mostly a symbolic gesture.
Poverty and hunger
As economic conditions continue to deteriorate, a growing number of Americans will fall into poverty and hunger.
In fact, according to NPR, “the demand for food banks has risen again,” and many of these food banks are already in crisis, they turn to cheaper products, limit how often people can visit or how much food they can get, and “expand their stock to meet the needs of more people.”
If food banks are facing such discomfort now, what will happen in six months or a year from today? Because the truth is that food supplies will become more limited.
Winter wheat harvest in the United States will be much lower than initially expected.
In fact, winter wheat harvest in Kansas could be reduced by “more than 25%.
The US winter wheat harvest potential in Kansas has been reduced by more than 25% due to the severe drought and farmers in the state may leave thousands of acres of wheat in the fields this year instead of paying for the harvest of grain affected by the dry winter.
Looking to the future, much less wheat is being planted for the coming growing season due to the extremely strange weather conditions in some areas.
For example, the amount of wheat currently being planted in North Dakota is expected to be the lowest ever recorded.
Some farmers in North Dakota are unable to plant as much wheat as they normally would because of heavy rainfall across the state.
Government figures show that the state is expected to plant wheat on the smallest recorded share of its agricultural land.
The bottom line is that there are really serious problems that are not going to go away any time soon.
A historical economic nightmare is here, the coming months will be quite chaotic. Fasten your seat belts!