{"id":62821,"date":"2022-06-03T16:12:27","date_gmt":"2022-06-03T21:12:27","guid":{"rendered":"https:\/\/olduvai.ca\/?p=62821"},"modified":"2022-06-03T16:12:27","modified_gmt":"2022-06-03T21:12:27","slug":"the-handbook-for-debt-soaked-nations-lie-print-inflate-finger-point","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=62821","title":{"rendered":"The Handbook for Debt-Soaked Nations: Lie, Print, Inflate & Finger-Point"},"content":{"rendered":"
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The Handbook for Debt-Soaked Nations: Lie, Print, Inflate & Finger-Point<\/a><\/h3>\n<\/header>\n
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Below we consider the classic (and oh-so predictable) tactics of debt-soaked nations\u00a0facing a showdown<\/strong><\/a>\u00a0(corner) between tanking markets and ripping inflation.<\/p>\n

Ultimately, I see a stagflationary end-game in which both occur, but for the near-term, prepare for more inflation, as it\u2019s the option all debt-soaked sovereigns are eternally forced to take.<\/p>\n

The Cruelest Month<\/strong><\/p>\n

T.S. Elliot famously described April as the cruelest month, but the recent (and ever-unfolding) events of May seem far crueler.<\/p>\n

As we have warned from the very onset of this otherwise\u00a0avoidable war in Ukraine<\/strong><\/a>,<\/strong>\u00a0the backfiring of Western sanctions against Putin (de-dollarization<\/strong><\/a>, inflationary tailwinds and increasingly discredited central banks) were not only plain to foresee, but placed the West in an almost comical (yet tragic) scenario in which nations like Germany find themselves sending weapons to the Ukraine while simultaneously\u00a0sending Rubles to Putin<\/strong><\/a>.<\/p>\n

How did the world become so hypocritical, dishonest, cornered and silly?<\/p>\n

(Cold) Economic Realism vs. (Empty) Moral Posturing<\/strong><\/p>\n

As George Washington observed in a 1770\u2019s moment of\u00a0Realpolitik<\/em>\u00a0candor: \u201cNations have no permanent friends nor permanent enemies, just permanent interests.\u201d<\/p>\n

Turning to 2022, the self-interested\u00a0reality<\/em>\u00a0of Western reliance on Russian energy has made their front-page virtue signaling a bit less virtuous\u2026<\/p>\n

Such cold realism explains why Italian Prime Minster Draghi\u00a0realistically<\/em>\u00a0confessed as early as May 11 that EU companies could pay for Russian gas in Rubles in the very same week German Chancellor Olaf Scholz\u00a0realistically<\/em>\u00a0opposed any immediate halting of oil imports from Russia.<\/p>\n

Meanwhile, by May 12, the headlines revealed that Russian oil revenues had increased YoY by 50% despite the Western \u201cboycott.\u201d<\/p>\n

An equally\u00a0realistic<\/em>\u00a0Japan, like Germany, will take its time to phase-out its dependence on Russian energy, as it, like Germany, recognizes that an immediate G-7 boycott of Russian oil and gas amounts to little more than an energy suicide pact.<\/p>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

The Handbook for Debt-Soaked Nations: Lie, Print, Inflate & Finger-Point Below we consider the classic (and oh-so predictable) tactics of debt-soaked nations\u00a0facing a showdown\u00a0(corner) between tanking markets and ripping inflation. Ultimately, I see a stagflationary end-game in which both occur, but for the near-term, prepare for more inflation, as it\u2019s the option all debt-soaked sovereigns […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,3,5],"tags":[124,195,32938,18507,426,15165,31019,538,2614,13351,32937,694],"class_list":["post-62821","post","type-post","status-publish","format-standard","hentry","category-economics","category-energy-2","category-geopolitics","tag-central-banks","tag-debt","tag-finger-point","tag-gold-switzerland","tag-inflation","tag-lie","tag-matthew-piepenburg","tag-money-printing","tag-oil-and-gas","tag-price-inflation","tag-print","tag-russia"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/62821","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=62821"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/62821\/revisions"}],"predecessor-version":[{"id":62822,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/62821\/revisions\/62822"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=62821"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=62821"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=62821"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}