Let's discuss the nature and potential of the coming economic crisis. Continental Europe is on the verge of deindustrializing due to being cut off from Russian gas, European banks like Credie Suisse seem to be on the verge of blowing up Analysis: Turmoil turns tide on Europe's banks after long recovery | Reuters
Rapidly rising interest rates and appreciation of the dollar means that the least profitable companies are being extremely squeezed, being cut off from credit. A further shock from winter demand for gas in Europe, hitting the same time as the regular capitalist weakness in the business cycle. Up until now, businesses have been getting a break as industrial profits grow at the expense of financial profits due to higher inflation, but as inflation cools, they'll start to really feel the bite of higher interest rates.
What are your thoughts? The Fed seems intent to intentionally break working class pressure for higher wages, how will this manifest politically as well as economically?
Businesses going bust means capital will concentrate, with a fall in the rate of profit. Monetary tools won't save Germans from freezing in winter. Europe is going to learn that being a vassal of the United States is not always beneficial.
Are you sure that inflation will cool rather than accelerate? I suspect the rate of exploitation has room to grow still in Europe. European workers still haven't really "paid" for the pandemic. Capital will demand its pound of flesh.
Businesses going bust means capital will concentrate, with a fall in the rate of profit. Monetary tools won't save Germans from freezing in winter. Europe is going to learn that being a vassal of the United States is not always beneficial.
Are you sure that inflation will cool rather than accelerate? I suspect the rate of exploitation has room to grow still in Europe. European workers still haven't really "paid" for the pandemic. Capital will demand its pound of flesh.
Higher unemployment will generally hurt aggregate demand and household budgets, but it's very hard to tell, especially in Europe, without knowing how bad the supply shock from gas/electricity rationing will be. Though I expect things to operate more normally in the US.