Luxe
Tjeerd RoyaardsWar machine. Cartoon for Dutch newspaper Trouw.
Uriel Fanelliuhm... expenditure for defense is, in Europe, below 4% of GDP. Depicting as a dominant economical force requires imagination.
@uriel I think you're misinterpreting the cartoon. Cost of living (especially energy) is undeniably on the rise due to the war in the Middle East, while most oil companies made huge profits because of this in Q1.
Cost of living (especially energy) is undeniably on the rise to to the war in the Middle East,
I’m not sure I agree completely. Much of the oil and many derivatives currently on the market were actually purchased long ago, often through mechanisms such as futures contracts and long-term supply agreements.
The same applies to the food supply chain: these systems move slowly. Agriculture follows seasonal cycles, and in many cases crops are harvested only once a year, so the effects tend to appear with a significant delay.
Of course, one could argue that media and governments are using this narrative to justify certain market dynamics or lobbying interests, rather than describing a simple direct cause-and-effect relationship.
The reality is that modern supply chains are extremely long and complex. Because of that, it seems difficult to attribute immediate price changes entirely to events that have only just occurred.
@uriel So no direct connection between to closing of the Strait of Hormuz and fuel prices?
Not within such a short timespan. Of course, a year from now — when the crisis is likely over — prices may still remain high, and at that point the very same arguments I make will probably be used to justify why the cost of living continues to increase even after the emergency itself has ended.
With the full support of some press and media.
For example, crops being sold today were largely grown using last year’s fuel, last year’s fertilizers, and last year’s production costs. Because of that, it is difficult for me to see a purely ->immediate<- cause-and-effect relationship that would justify sudden price increases overnight.
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