You can kill 7 innocent children & 3 adults & not have any consequence whatsoever as it is an "honest mistake." Meanwhile, there's a looming famine in Afghanistan. The US didn't just pull the troops from Afghanistan, it pulled the lifeline of 40m people.
The US slapped sanctions (+freezing 10bn of reserves) on Afghanistan for obvious reasons - the Taliban took over.
But 40 million people suddenly also don't have means to feed themselves as the aid that they need can't flow.
So now what? People are desperately hungry.
I'm not an Afghanistan expert & just read a few articles tonight & so far all the stories show development experts/agencies calling the US to reconsider its tough sanctions that have contributed to an economic collapse & humanitarian crisis.
Btw, that Guardian article got the population of Afghanistan wrong, it's 40m not 23.
The 23 million number is the people in that country that face food insecurity. 9 million people are near famine.
That is a lot of people. Don't forget we also got Covid on top of famine.
NYT: "Overnight, billions of dollars in foreign aid that propped up the prev Western-backed government vanished and U.S. sanctions on the Taliban isolated the country from the global financial system, paralyzing Afghan banks and impeding relief work by humanitarian organizations"
“We need to separate the politics from the humanitarian imperative,” said Mary-Ellen McGroarty, the World Food Program’s country director for Afghanistan. “The millions of women, of children, of men in the current crisis in Afghanistan are innocent people who are being condemned"
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Good morning! Very very busy macroeconomics day! And u know I love it! Okay, let's start with the US as we all care about the Fed meeting at 3am HKT.
PPI was off the chart high at 9.6%YoY and we know that the Fed is now in inflation fire fighting mode 🔥🧑🚒🧯 & pushed USD higher
In Asia, before the Fed, we got China data coming out & in November things will feel a bit saggy, which we know that the government is worried about because they already cut the RRR by 50bps to shore up demand.
More to come easing wise, both monetary and fiscal to help the eco!
And tonight, on the back of that gangbuster PPI, we got retail sales, which were pretty strong in October & again good in November.
The Fed meeting is in focus as markets will see how INTENSELY focused it will be on fighting inflation. Tapering to double the pace to USD30bn &
Inflation expectations are key to future inflation & that is why the Fed monitors.
People’s expectations lead to reaction. If they think CPI is gonna be 6%, they’d want a raise to feel less poor & so everyone doing so leads to inflation.
So the Fed is worried & should be!
The Fed uses words like anchoring inflation expectations around 2%. The word anchor means u wanna not let it go out of control because once inflation expectations are rampantly high, it feeds into itself & hard to control.
So at 6.8% & expectations elevated, the Fed needs to act
What do u think central banks' mandates are? And if so, and if we use data as an indicator or proxy for their success, as in CPI, how would u say they do.
Btw, most have 2% as a target, as in the Fed and the ECB. Global CPI below.
The Fed: 2% CPI target.
US current inflation is 6.8%YoY
How many months since it has been past the 2% target? Well, since March 2021.
Okay, will it fall below anytime soon? No.
Is inflation a tax on the poor? Of course it is. This is US inflation growth and US personal income growth.
The price of goods rises faster than income & so it's a squeeze on consumption. Who has a the highest share of consumption relative to income? The POOR & the middle class
This news is interesting of Instagram, which is toxic for eve, especially to young girls, as it feeds people sociopathic tendencies - narcissism. Why u say? Well, if Meta acknowledges that it creates toxic content & also has algos to keep people addicted, then the solution is...
We all know what the solution is: JUST TURN IT OFF. Like stop using the very thing that makes you sad, waste a bunch of time and basically turn you into a worse person because let's face it, taking selfies all day long is rather a sad activity.
But no, it's nudging for a break.
But not a real break is it? It says to look at something else on Instagram.
I mean, if you love your children, turn off their social media, that includes Instagram, Facebook, Snapchat, Tiktok. Have you seen what they do to little girls & what they do to feel validated?
Are u ready for some optimism for markets & just life in general? The RBA 🇦🇺, like its government, isn't worried about Omicron as it sees economic recovery even w/ Omicron. Well, bad for bonds but good for outlook! And Indonesia scrapped year-end curbs as vaccination picks up! 🇮🇩
And there is another reason for optimism if u were Australian: China demand of commodity remains high, especially energy. Look at China imports from commodity exporters such as Australia, Brazil, Russia, Malaysia, Singapore, Indonesia, and the USA.
And?
All of this commodity import is not just for domestic consumption but also to feed into its manufacturing exports, which continue to be in high demand globally in November.