Tag Archives | inflation

With the Federal Reserve pushing up interest rates, we appear headed for a new recession.

The Secretary-General of the UNCTAD is warning that “the current course of action is hurting the most vulnerable, especially in developing countries, and risks tipping the world into a global recession.”

The so-called electricity markets were created to help private capital, not people. It is time we wound up these bogus markets and returned public services to people, to be run cooperatively for their benefit

As rich countries raise interest rates in double-edged efforts to address inflation, developing countries are struggling to cope with slowdowns, inflation, higher interest rates and other costs, plus growing debt distress.

ECONOMISTS distinguish between two kinds of inflation: “demand-pull” and “cost-push”.

The hegemony of the U.S. dollar was based on the fact that the world’s wealth-holders considered it to be “as good as gold”, even when it was no longer officially convertible to gold at a fixed rate, as it had been under the Bretton Woods system, after the collapse of that system.

Capitalism is a system that has an innate tendency to get into a cul-de-sac of crisis, and the only way it knows for coming out of crisis is by further exploitation of the working class.

The devastating effects of global warming are being felt by billions of people all around the world. Meanwhile, capitalist fat cats are openly downplaying the risk of entire cities being buried beneath the rising oceans as a trifling inconvenience. Like Emperor Nero before them, the rulers of this destructive system are fiddling–this time–as Rome drowns.

Whether the Fed can succeed in taming inflation and do so without precipitating a recession remains to be seen but is highly unlikely.

The Bureau of Labor Statistics reported that the rate of inflation rose to 8.6% in May, the latest high in a period of rapid growth in prices following the COVID-19 recession in March 2020. Indeed, inflation is now higher than it has been in the past 40 years.

The global food crisis has now grown to such proportions that everyone is talking about it (even though world leaders are doing relatively little about it).

Central banks all over the capitalist world are raising, or are about to raise, interest rates as a means of countering the currently rampant inflation, which is certain to push a world economy that is barely recovering from the effect of the pandemic, back towards stagnation and greater unemployment.

Prices of commodities can be broken down into the three main components: labour costs (v= the value of labour power in Marxist terminology, non-labour inputs (c =the constant capital consumed, and the “mark-up” of profits over the first two components (s = surplus value appropriated by the capitalist owners). P = v + c + s.

On April 19, the International Monetary Fund (IMF) released its annual World Economic Outlook, which forecasted a severe slowdown in global growth along with soaring prices. ‘For 2022, inflation is projected at 5.7 percent in advanced economies and 8.7 percent in emerging market and developing economies–1.8 and 2.8 percentage points higher than projected in… January.’

Everyone knows that inflation in the United States is increasing. Anyone who has read the news, or for that matter has gone shopping lately. Prices are rising at the fastest rate in decades. The Consumer Price Index rose 8.6 percent in March, which is the highest rate of increase since December 1981 (when it was 8.9 percent).