Since the Great Recession, the Fed has transformed itself into an entity more and more responsible for asset prices. This was the stated goal since 2009 as the Fed adopted a new philosophy called the "Wealth Effect." The thinking behind it was simple: growth in asset prices would translate to an increase in consumer spending and hence demand itself. It was a 'trickle down' economic philosophy an increasingly financialized economy.
This backdrop has defined our post-2009 era which stirred certain pathologies that were reflected in the greater culture and politics. It was the time when 'finance became a culture' and actual-productivity plummeted across most developed economies, especially the United States. But somehow in spite of the accumulating dysfunction across most key areas, everything kept trudging along, partly thanks to investors being satiated with record returns.
While the near-zero interest rate regime may now be ending, it is worth considering how much of the water we were all swimming in excused poor state capacity, distorted economic fundamentals, and how it even kept a lid on the dysfunction potentially blowing up in our faces. Now that we have to reckon with these realities, it may be wise to ask how many worldviews were simply products of the the cheap money regime - which is now, in a shock to many, coming to a close. Whether or not it will easily be let go, however, is another matter.
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Notes -
Higher prices aren't just about encouraging quantity supplied, they are about reining in quantity demanded.
Higher gas prices mean consumers will attempt to avoid using gas where they can, and less-productive uses of gas in industry will fall by the wayside. This is as true of gas as it is of every product. This is an important function of prices in an economy.
Also worth pointing out: "russia invaded a country so we aren't taking their gas anymore" is not a black swan, being as it is an entirely logical outcome of modern Russian warmongering. "We could hardly have foreseen Russia invading their neighbors again" is unpersuasive.
But it only makes sense for potential suppliers to build ways to take advantage if they will be able to profit from such speculative preparations when prices spike.
I would amend this slightly - "Russia invaded a country NATO and the EU cares about, so the EU is willing to nuke their own industries to spite the Russians" really is a black swan. No-one cares about invasions or ethnic cleansings qua invasions or ethnic cleansings; no-one was calling for gas boycotts over Transnistria or Ossetia/Abkhazia or even Crimea. Hell, Azerbaijan is currently in the process of waging a minor ethnic cleansing campaign against Armenians in Nagorno-Karabakh (which they took in an offensive war earlier this year) and no-one serious in Europe is asking to shut down Azeri petrochem transfers - instead they're desperately trying to use them to try and make up the Russian shortfall.
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