Inflation Turbulence
An interesting money fact appears at the beginning of the third decade of the 21st century. The Fed raising interest rates is causing inflation across much of the rest of the world.
FT has a piece, “Ghana raises interest rates to 22% in biggest move for 20 years, central bank seeks to counter soaring inflation and depreciating currency.” Just raising rates to 1.5% has caused the dollar’s value to surge in relation to all those countries’ currencies dependent on exporting a few commodities for their dollars.
This just ain’t in Africa, look at NATO member Turkey taking a novel approach to fighting 80% inflation by dropping their interest rates, “Turkey surprises with interest rate cut as inflation soars.”
Phew! Isn’t it time to let the Turks in the EU, and even better, the Euro? After all, doesn’t the Russian war demand it and wouldn’t it teach the Turks a little fiscal discipline, letting the ECB decide how the Turks spend their money? They could be the new Greeks and Italians.
Wall Street has some new allies in their attempt to keep the Fed from continuing to raise rates. Many of the finance boys certainly seem to have convinced themselves over the last six weeks the Fed’s done raising.
Today, the Fed exports the inflation they sought so hard to create for a dozen years, not that they’re in anyway solely culpable, but definitely instrumental. Good thing that Anti-Inflation Act passed — right?
Well, interesting times for the global money system. To paraphrase Mr. Zevon — Turmoil back in DC brought this turbulence down on me.