My kneejerk reaction to this was “wut… you can’t be serious?” This is according to their chief economist Jan Hatzius. This is willful complicity or insane incompetence, and possibly a combination of both. It’s based on faulty assumptions including this AI bubble economy and an April jobs report number that was effectively low balled with the jobs gains (that is if you believe the numbers the labor department under this criminal regime is putting out).
I’ve always held a healthy dose of skepticism with these job labor and farm payroll numbers. When factoring in the criminals running the U.S. Federal Government agencies now, I trust nothing that comes out from these officials. Yet, the media (in the U.S.), politicians (globally), and corporate execs have treated this like business as usual (especially regarding the continual lies about negotiations with ending the Iran War by the U.S. president when they are occurring every week like clockwork in order to create these inside trading opportunities).
I could put out as good or even better erroneous bad take reads on the global economy for much less money (aka for FREE-NINETY-FREE) than this economist. When you listen to experts in the energy markets stating frankly that things are not going to recover quickly even if the war were to end today, the machinations of this “research note” is equivalent to sticking ones head in the sand.
Of course, I do realize these folks are looking at this selectively (it’s why there is this constant disconnect between the financial markets and the regular working class); like how only certain sectors are bending , how some industries are doing great, how the traders that are making well timed market trades are raking it in, and how a much narrower segment of equities are going up (pushing the indices to these highs). I have written about how this market has long been rigged (and invested in it since 1997 with this piece of knowledge).
Now put yourself in the shoes of the average working class, many who unfortunately do not participate in the stock market because of so many factors (priced out, not educated enough about it, listening to the advice of so called experts that often times are not in the best interest of the average investor, etc). Parts of the working class are just trying to survive paycheck to paycheck and are abused by this system of extreme capitalism (which treats employees as disposable assets).
The situation in the Middle East was self-inflicted by Israel and the United States. They own this but are trying to use well worn out propaganda that Iran is the terrorist nation while the reality has been the complete opposite (with the two countries that have nukes acting like the terrorists in the region). The outcome of that has been a drastic interruption in the global supply of oil, aviation jet fuel, fertilizer, helium, etc, etc.; all of which will have this domino effect on every part of the global supply chain (latent effects to boot).
Short example: Trucking relies heavily on diesel. It’s topping $7.50/gallon in California. Farm equipment relies on diesel. Farms are also being impacted by the dwindling supply of fertilizer. The result will be global crop and feed shortages. Food supply gets impacted versus demand imbalances = rising prices. Tack on all of the energy cost increases throughout the supply chain = price increases for the customer. This is weeks down the road just for the supply and cost of food. Everything else is going to be going up as well.
Even if everything were to magically go back to the day before Israel and the U.S. started this war, the experts who know the Middle East and those who understand the logistics for shipping in that region, realistically know it will take several months for that shipping to even begin to return to some normalcy where the supply/demand imbalance will begin to level back out again. Plus destroyed oil facilities do not magically get fixed overnight (some of that will take years to repair).
Then there is this stark warning from the Saudi Aramco’s CEO who mentioned that the oil market may not see recovery until 2027 due to the disruption (and if it continues until mid-June). I guess one could take that with a grain of salt as well since Saudi Aramco isn’t always honest (we live in this world of the rich/powerful being lying assholes ok). The basic take away is how this disruption is going to have these latent impacts on economies all over the world (and none of that will get automatically fixed in a short time).
