This article was originally published by Michael Snyder at The Economic Collapse Blog.
This is what the early chapters of an inflationary meltdown look like. Last week, we were informed that “consumer prices were 7.9% higher in February than a year ago”, and that was being touted as the highest figure “in 40 years”.
Of course, those that follow my website on a regular basis already know that the reality is much worse than that. If the inflation rate was still calculated the way that it was back in 1980, it would be over 15 percent right now. We are already experiencing the sort of painful inflation that Americans were forced to endure during the Jimmy Carter era of the 1970s, and now the war in Ukraine is going to completely change the game moving forward.
Last week, the average price of a gallon of gasoline in the United States rose 13 percent, and since this time last year, it is up 38 percent.
And now that the war in Ukraine is shifting the global energy crisis into overdrive, Americans are going to be feeling the pain of higher energy prices in a whole host of different ways…
Americans are facing sticker shock at gas stations across the country, but surging global energy costs are rippling through the economy in other ways, too: Airlines are scaling back on flights. Truckers are adding fuel surcharges. And lawn care companies and mobile dog groomers are upping their service fees.
One trucking company executive that was asked about this said that he has “never seen prices jump this high, this fast”…
“Customers really don’t want to hear it, but fuel prices are going through the roof so we’re having to charge more,” said John Migliorini, vice president of Lakeville Trucking in Rochester, N.Y., where diesel costs have nearly doubled to about $400,000 a month. “What choice do we have? I’ve never seen prices jump this high, this fast.”
And he is exactly correct.
Ever since the full-blown invasion of Ukraine was launched on February 24th, we have seen prices spiral out of control all over the country.
Joe Biden knows that the American people are getting restless, and he is trying to pin the blame for our inflation nightmare on Vladimir Putin.
But Vladimir Putin didn’t borrow and spend trillions upon trillions of dollars that we did not have over the last two years.
Our leaders in Washington did that.
And Vladimir Putin didn’t create trillions upon trillions of fresh dollars out of thin air and use them to prop up our financial system.
The Federal Reserve did that.
This inflation crisis started long before the war in Ukraine, but without a doubt, the war in Ukraine is going to make things even worse.
In fact, the UN is now warning that global food prices could soon jump by as much as 22 percent “above their already elevated levels”…
With dozens of countries around the world relying heavily on both Ukraine and Russia for food supplies, the United Nations warned Friday, the ongoing war is likely to significantly drive up global food prices and worsen malnourishment in the Global South. With both Ukraine and Russia’s ability to produce and export food uncertain, a global supply gap “could push up international food and feed prices by 8% to 22% above their already elevated levels,” said the U.N. Food and Agriculture Organization (FAO).
Two weeks into Russia’s invasion of Ukraine, which has killed more than 560 civilians and forced more than 2.5 million people to flee the country, FAO said up to 30% of Ukrainian wheat fields will not be harvested in the 2022 to 2023 season due to the violence.
For the billions that are already living in poverty all over the planet, that is really, really bad news.
Here in the United States, one Oklahoma farmer told Laura Ingraham of Fox News that we are “going to get hit on every front”…
“We’re going to get hit on every front, on every expense possible,” Oklahoma farmer Ben Neal told Ingraham, “From fertilizers to fuel to labor, insurance – everything in between [including] our packing supplies.”
Neal’s farm operates on a farm-to-market business model, so he has direct fuel costs for transportation. But every farmer essentially faces the same thing – crops need to be transported to processors and final markets and there are increasing fuel costs to power the trucks, trains, barges and ships that make that happen.
In other words, groceries are going to be getting more expensive.
A lot more expensive.
Meanwhile, our economic war with Russia continues to escalate.
Over the past few weeks, the U.S. has hit the Russians with a slew of economic sanctions, and without a doubt, those sanctions are really starting to hurt…
European energy is only one part of the sanctions piece. Financially Europe and the US have frozen deposits of euros, dollars and sterling held by Russia’s central bank, cutting Russia off from a large part of its net reserves. In manufactured goods Russia is now isolated from spare parts supplies for Boeing and Airbus aircraft and for almost every private car in Russia. Russia is also cut off from new supplies of servers (cloud computing cannot expand capacity), software and a range of high-end chips which Russia cannot yet manufacture.
Some commercial software (particularly in the oil and gas industry) only operates with regular provision of unlock keys, which will not now arrive. Some millions of Russian employees of Western companies are now functionally unemployed, while all Russians are now cut off from travel to Europe and North America. Imports of western goods of all kinds to Russia are now stalled for lack of sanctioned shipping, while exports of oil and metals are under threat from sanctions on shipowners.
The Russian economy will never be the same after this.
But will ours?
We have already been suffering through a pretty painful chip shortage for the last two years, and now the war in Ukraine threatens to take it to an entirely new level…
The ongoing geopolitical tussle between Russia and Ukraine is likely to have another casualty – the semiconductor chip. Palladium and neon are two resources that are key to the production of semiconductor chips.
Given that Russia supplies over 40 percent of the world’s supply of palladium and Ukraine produces 70 percent of the global supply of neon, we can expect the global chip shortage to worsen should the military conflict persist, Tim Uy, of Moody’s Analytics wrote in a recent report.
It would be difficult to overstate the seriousness of what we are potentially facing.
Almost every industry in America relies on equipment that contains computer chips.
So what will our economy look like if the chip shortage becomes extremely severe?
And this is just one way out of hundreds that our economic war with Russia is going to hurt us.
Most Americans simply do not understand how horrible things will become if this thing stretches on for an extended period of time.
We should be hoping for peace, but instead, most prominent voices seem to want to escalate matters with Russia even more.
What we are watching play out right in front of our eyes should sadden us all, because there will be no going back after this.
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About the Author: My name is Michael Snyder and my brand new book entitled “7 Year Apocalypse” is now available on Amazon.com. In addition to my new book, I have written five other books that are available on Amazon.com including “Lost Prophecies Of The Future Of America”, “The Beginning Of The End”, “Get Prepared Now”, and “Living A Life That Really Matters”. (#CommissionsEarned) When you purchase any of these books you help to support the work that I am doing, and one way that you can really help is by sending digital copies as gifts through Amazon to family and friends. Time is short, and I need help getting these warnings into the hands of as many people as possible. I have published thousands of articles on The Economic Collapse Blog, End Of The American Dream, and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I always freely and happily allow others to republish my articles on their own websites, but I also ask that they include this “About the Author” section with each article. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial, or health decisions. I encourage you to follow me on social media on Facebook and Twitter, and anyway that you can share these articles with others is a great help. These are such troubled times, and people need hope. John 3:16 tells us about the hope that God has given us through Jesus Christ: “For God so loved the world, that he gave his only begotten Son, that whosoever believeth in him should not perish, but have everlasting life.” If you have not already done so, I strongly urge you to ask Jesus to be your Lord and Savior today.
“We should be hoping for peace ……. ”
We should be staying out of it.
Ukraine isn’t NATO do we have no obligation to get involved, Russia and it’s non member NATO countries need to work this out on their own.
JOE and the HO must GO!
On small helpings of food staples, bought a little at a time:
+$0.50 in one day.
NO, ITS NOT PUTIN’S FAULT!!! Lying chicken neck basement boy.
American political hack psychopaths are in charge and their wrecking ball continues across AmeriKKa
We are NOT in a true Supply/ Demand economy. Many American Corporations are just jacking up prices for more profit to fleece the consumers. And they can use the excuse alibi of supply chain,, Putin and covid to rape the public though fraudulent price gouging disguised as inflation.
There are a whole slew of corrupt politicians and corporate CEO’s that need to be locked up and tried for economic terrorism.
They think we are stupid. We got your number Jack!! We are all over this exposed Sh!t pile of your fraud against us.
At least workers aren’t demanding higher wages too, they know that would be inflationary and are willing to forgo higher wages to fight inflation.
@ tharsheblows,
Wow, you are all over the board with your arguments. You say it’s not Putins fault which is true, but then you use the old argument from the liberals saying it’s the greedy CEO’s….which is false. Put the blame squarely on the people who deserve it. The failed policies of the current administration and the ones on both sides who have sold us out.
You can’t shut down countries for 2 years with a fake pandemic, scare the hell out of the sheep, then expect that you can flip a switch and be back up and running like nothing happened.
You can’t say that that crap jobs once held by teenagers should now pay a living wage with out consequences.
Companies can only take on so much in the way of increased prices- utilities, insurance, food costs, gasoline, wages, etc all hit hard.
Inflation is at a 40 year high, and if calculated like they did in the past, would be at 15% right now. And yes, this was all before Putin. We are outspending on everything and everyone but ourselves and our borders. This is an absolute disaster and In just one year, we have destroyed so much of what this country was built on.
This isn’t just one problem, but the failed agenda of those in control. They have to break down every industry, the people, the dollar, literally everything to destroy everything about our country.
They are re-writing history as we live it to fit their agenda.
Funny how it works. I thought the US was the first or second largest producer of crude oil. Maybe so, but if you use it all domestically and still need more it is mostly a useless metric.
Ruralsville, USA gas….$4.39/gallon
Moscow, Russia gas….$0.82/liter or $1.42/gallon
Russia exports 5 million net barrels/day. US imports 675,000 net barrels/day. And Russia subsidizes it’s gas for it’s people.
But I thought the high US gas prices were Russia’s fault?
Edit…that should be $ 0.38/liter and $1.42/gallon in Moscow.
Russia produces more than it consumes, we do not.
Biden Bin Laden wants to send $13 Billion to Ukraine’s current corrupts Nazi appointed government and fir sure 10% will be kicked back to the Big Guy.
These 4 US Politicians have their children working for Ukraine Gas Companies.
Mitt Romney’s kid
Nancy Pelosi’s Kid
Biden’s Kid
John Kerry’s Kid
And that POS dictator in Ukraine say they will fight to the last Man Standing. Its not his children he is forcing to protect his corrupt regime is it?
Anybody to sides with this Ukraine BS nazi Government is a fool and easily fooled, or corrupt.
But what about all that Syrian oil the US troops are “guarding” to prevent those Syrians from using it to heat their houses this winter?
What? You say they’re guarding it for the Kurds so they can sell it to Israel?
I see prezJB as little more than a mere buffoon, but it is wrong to entirely blame him for the inflation. Sure, he got on board that train and is riding it and not doing anything to help the situation, but the real culprit is the Fed. Res. printing money out of absolutely nothing. That is to say, not only is the money not backed by anything, it is literally made from nothing. Simplified, it goes something like this. The FR actually hits key strokes to show some predetermined huge number, sends that number to the gov’t and buys x number of bonds, notes, bills, whatever, then the gov’t puts that “money” in circulation. This is done regularly mainly because the gov’t keeps way over spending, and creating huge I debts. Except for cash, which is only used in a small number of transactions, the money is not real, it is not physical, and it loses value. I save some cash too, and a lot of it is not in a bank, but I realize that cash is constantly losing its purchasing power everyday. The good thing is it buys me things where there is no electronic trail record of transaction. The FR, the banking system, and the gov’t, crave a cashless system. In effect, in this country, we have a private institution (the FR), that creates non tangible “credits”, gives those credits to the gov’t (gov’t of, by, and for the people – yeah, right) to buy public finance instruments, in return the FR gets massive returns in interests, fees, etc. Therefore, for every “dollar” created, more than a dollar of debt is created with it.
Even now, the infrastructure for a cashless society is being developed. The goal is to force everyone into a system where there is no privacy or personal autonomy. This will give vast new powers to the State. The citizen will have to resort entirely to bartering for privacy. However, the gov’t already requires the reporting of bartering in certain cases and is taxable if it is not a business expense. Anything for personal use in many cases is technically taxable.
Biden is spending US Tax Dollars to protect 5 other Countries Borders, and refuses to protect America’s Borders. This is Treason.
Read the Memorandum that was signed by some nations when Ukraine gave up its nuclear weapons in the ‘90s and the promise to give the Ukraine security from those very nations. Those are the ones that are on the sideline now….. Wikipedia you can find it….not sure how much I can believe of Wiki anymore but for what its worth I do think it is true. Because no one is saying anything there likes… and as usual the more the media is quiet about something the more it is true and disturbing. If that is true I am disgusted by ALL of those nations. Let’s watch the war like a boxing match, should we bet on a winner as well…. D i s g u s t i n g – NATO has about 9x the power then Russia and is supposed to protect Ukraine. Selling jets to the Ukraine as well as tanks should be okay if USA will send money to rebuild Ukraine they can subtract those planes if so……. But stop being told what to do NATO – take actions and stop reacting – makes you look weak…especially with terrorists. I always thought we don’t negotiate with terrorists well, I also thought that the US military is not leaving anyone behind ? The world is changing.
Yes, the world is changing,
It will not be a change for the better for some time, in fact it will be the opposite, but it will be that way in the end.
You’re right about the Budapest memorandum saying that the signatories would come to the aid of those 3 countries that gave up their nukes. Reading the Wikipedia entry down farther, it also said that the US claimed it was not a legally binding document (like they do with most agreements they make).
Anyway, neither NATO nor the US have any extra fuel to run a prolonged war against a formidable opponent They can barely keep the lights on and the homes warm as it is. Russia does have surplus.
Game. Set. Match.
How deep of a bunker does Doom porn Snyder have? This guy must really bug out with just a power failure! This ponzi is gonna go on for as long as possible! Banksters gotta bank!
Jess, you must’ve had your 4th shot I bet. At least you’ve done a booster.
You must have had your 5th booster, you don’t comprehend what “reply” means lol.
Today, I want to address the issue of hunger in the developed West and the explosion in ‘food banks’. We are told this is because people can’t afford food sold in the supermarkets. This is not true. We are told people can’t get enough calories and thus they go hungry. Also not true.
People go to food banks (and by this I mean the working poor, not the useless drug and alcohol addicts who would take any freebie going), because of the high cost of housing and utilities. And housing and utilities have been experiencing exponential inflation since the mid-1990s.
Hunger could be easily resolved by sending every working poor person a cardboard box filled with cheese, peanut butter, cheap vegetables (carrots, potatoes, spinach etc.), bread etc. These boxes would cost very little and could actually be filled with surplus produce from supermarkets.
What can’t be done so easily in our system is make housing affordable, because that would break the hypothecated financialised housing market.
For your average sedentary Western working poor person or idle welfare recipient, the amount of calories they need is not so much. And as we can see from the gross obesity rates, people are getting more than enough calories.