Faber News Flow

This article examines two inflationary experiences in the past in an attempt  to predict the likely outcome of today's monetary policies . The German hyperinflation of 1923 demonstrated that it took surprisingly little monetary inflation to collapse the purchasing power of the paper mark. This is relevant to the fate of the  "whatever it takes" inflationary policies of today's governments  and their central banks. The management of John Law's Mississippi bubble, when he  used paper money to rig the market is precisely what central bank policy is aimed at achieving today . By binding the fate of the currency to that of financial assets, as John Law proved, it is the currency that is destroyed. Introduction At the outset, I shall make a point about the relevance of the chart below, a screengrab from Constantino Bresciani-Turroni's  The Economics of Inflation , which has been frequently reproduced and will be familiar to many who have read about Germany's pos...

Nella Nadef una crescita extra da 0,9% nel 2021 e da 0,8-0,7% nei 2022 e 2023 Gualtieri: «Investimenti pubblici sopra il 4% del Pil». In pista piani alternativi in caso di bocciature Ue da "Il  Sole 24 Ore" di Marco Rogari e Gianni Trovati Gli spazi di deficit aggiuntivo da 1,3 punti di Pil serviranno alla legge di bilancio anche per anticipare gli investimenti poi finanziati dal Recovery Fund, con una sorta di ponte che agirà prima di tutto sul rilancio di Industria 4.0 in versione «plus» e la spinta agli investimenti pubblici. E per evitare i rischi legati alla possibile bocciatura degli interventi che si candidano ai finanziamenti si studia l'idea di preparare «progetti panchina», chiamati a subentrare in caso di stop Ue. Una doppia mossa, quella studiata dal governo per la manovra, che serve a sostenere una scommessa da 45 miliardi di crescita extra in tre anni: scommessa ambiziosa ma indispensabile per piegare un debito ora al 158% del Pil. A produrre la crescita agg...

·        The immediate impact of the Covid-19 shock on inflation has been decidedly deflationary, but in light of the brewing cocktail of post-pandemic economic trends, the probability of an inflationary overshoot has also risen. In fact, ambivalent market signals suggest that participants are pricing in a higher risk of extreme inflation scenarios – on both the downside as well as the upside. ·        In a base case, we see the inflation outlook moving through three phases of varying supply and demand pressures: 1) messy data in the immediate crisis aftermath, 2) a disinflationary recovery in 2021 (U.S.: +1.6%, Eurozone: +0.9%) due to substantial slack in the economy and a swift rebound in supply and 3) a temporary inflation overshoot in 2022 (U.S.: 2.1%, Eurozone: 1.2%) following a recovery to pre-crisis activity amid gradual supply headwinds but no policy paradigm change on wages or fiscal and monetary policy. ·        What would it take for a scenario of a...