Ukraine Always Get What You Want

The Czech CPI was pushing 10 percent BEFORE the Russian invasion. That tweet is similar to Biden trying to pin runaway prices here on Putin.

Inflation is a monetary phenomenon. It has way more to do the chart in the link below than the Russian invasion.

Broad money (% of GDP) | Data

Worldwide, central banks created a decades-long fantasy on the back of inceasingly cheapened money and mispriced debt on the back of that cheapened money.

That is where we (and the Czech Republic, and everyone else) is at today. It was pure hubris.

Supply shocks because of the Russian invasion exacerbate it. But it's not the cause, and if Russia withdraws today, you still have financial conditions that are recklessly STILL too loose and making things worse. The rising prices are not going to go away without that changing, which is going to require engineering a global recession that is going to be brutal. The brutality of it is going to need to be in direct proportion to just how much money has been injected into the global economy, particularly since 2008ish and the financial crisis. This was always a certain eventuality.

The problem with that is that given the choice between runaway inflation and tanking the economy, they are going to choose to try to inflate away the debt, because the people in control of this think the blowback of taxing people that way for it won't hit them as hard with blame that way. So they are STILL trying to kick the can down the road, and in the process, digging a deeper hole that I long ago resigned myself to only ending when they lose control and trillions of doollars of credit defaults happen in a disorderly way that causes maximum pain for a lot of people.

The Czechs' are not innocent bystanders in any of that. Since 2014 or so alone, they DOUBLED their money supply. That is a formula for runaway inflation. But because the mechanism can take time to bring it about, people only see all of the mispriced debt making everyone feel "wealthy" (on paper) while that is happening, and they don't think about what the cost is going to be.