Covid showed us a few things….

Long distance supply chains fall apart if there aren’t the people or the will to move them. “Just in time” logistics and production make things cheap, but break down horrifically under pressure. Lastly, it became clear that countries cannot be relied upon to supply or sell things to you if there are shortages.

The push to start shortening supply chains, hold inventory, creating energy and food security are of course all extremely inflationary.

Now it has got worse……

It’s not just countries cannot be relied upon to sell us things, they cannot be relied upon to sort things out without going to war either. Economically Russia is a minnow (10% of EU GDP), but it punches above its weight militarily and obviously isn’t afraid to use it. Cue massive defence spending and tax hikes across the west. This is looking like stagflation, not the frothy growthy inflation that seemed to be bubbling.

The good times could be over, not just for a dip but for the foreseeable future.