This Winter will be Different for Everyone!

The inflation rates are raising all around the world with a few exceptions. As the prices of everything increase faster than the salaries, many people face sacrificing their quality of life to be able to sustain their life quality.

Some people name this era as Everything Bubble while there are also group of people who think that the prices are naturally increasing in accordance with the printing of paper money.

On Twitter, I saw the a of McKinsey once again. Check the page on Global Inflation to have a better idea.

Everything Goes Up

The charts of commodities do not look good for today and the future. In the cases of the loss of value for your fiat currencies, commodities can hedge your losses easily.

Commodities’ contribution: Investors often say that in inflationary times, the best place to invest is in commodities. That’s of course because commodity prices reflect the demand for raw materials needed for economic expansion.

When I look at the charts, the chart of Energy directly attracts my attention as it seems relatively softer in the value acquisition process than Fertilizers. As we all know, the Energy Crisis is a huge threat on economies as energy is a fundamental source of living and production.

Not too good.

"A brewing food crisis." says McKinsey

I lost the track of food prices in my favorite restaurants. Whenever I check the menu, I only see that the prices are "updated". The most challenging part of the case is that we're in summer and spring with stronger fiat currencies. However, this winter we will see everything increase a couple of times due to the War in Ukraine, production costs, energy cots, etc.

In the midst of Everything bubble, we will have several problem at once.

• The problem with the price of Houses and Rentals
• The problem with energy and heating
• Increasing costs of logistics and production
• Loss of value due to inflation

The Dynamics of Global System is at Risk

Obviously, the global trades will be directly affected with the problems arising in the world. Especially countries which have balanced import-export trades may face halting their operations or decreasing the frequency of exportation.

When global trade is also dramatically hit, there we may witness the waves of unemployment rates skyrocketing. If we also add the risks of a conflict in Taiwan, things get even harder for common people to manage the risks and be prepared for them.

We are paying the costs of quantitative easing in global pandemics. The side effects of inflation is combined with global risks. Governments can still get their tax revenue and govern in the same way. However, households are fighting against decreasing purchasing power, increasing prices, and global risks to secure themselves.

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