EU & US Inflation A Menage A Deux

EU Inflation hits 10% as hotter than hell energy bills help keep its inflation hurricane growing. In US, fuel largely responsible for its 8%-ish hyper-inflation is ever-expanding housing bubble. Recipe for Recession a Deux?

The shock of reaching a “record” double-digit inflation, the WSJ says, has Europe’s “power suppliers scrambling for reserves” as the ECB, like our own Federal Reserve Board, is set for a series of even more inflationary interest rate hikes as the chief weapon against … stubborn or rising inflation. The Euros are now facing the reality they are likely going to have a tough time getting through the winter like bugs in a rug while “further falls in household spending power … threaten to push the currency area’s economy into contraction” aka recession. Then, there’s Putin’s war in Ukraine roiling energy supplies & terrorist saboteurs blowing up that Nordstrom pipeline …

Where have we heard this “inflation loves recession” story before? The DOL recently confirmed that the US economy did, indeed, contract for the second quarter in a row, this time, by .06 percent. In the past, two consecutive contractions was widely assumed to equal “Recession.” Much of today’s left-leaning MSM, however, is mostly recession deniers. “No signs of recession,” we’re often told. The main driver this time of the “non-recession” contraction the US then? Housing costs. The antidote? Those darn higher interest rates a la mode More contraction? Do the math as the EU & US seem to be sleeping in the same inflation-recession bed.

Davd Soul