We have short term price pressure because of Brexit, Covid and climate change, but when iron ore prices can fall by 20% in a week, as they gave done in the last week, this can be seen as the price of disrupted markets and not the consequence of any underlying monetary trend that can be tackled by central banks.
All monetary explanations of inflation are wrong because the iron ore price can fall. Good to have that sorted out then, eh?
What is the way forward? With this post already 1,000 words long this is not the moment to address that in detail. But there is one over-riding message, which is that nothing will change until it is accepted that what we have had is broken, irreparably. Whilst we hanker for what was, and the idea that we can ‘get back to normal’ remains a dominant narrative, we remain in trouble.
What was has, I rather strongly suspect, gone. What we have to do now is build what comes next. It does not matter whether we want to or not. We have no option. The way we were was not sustainable in any sense, whether politically, economically or socially. When that is recognised we can move forward. My big concern is that I doubt that we are there yet. At the same time, I also think that awareness is coming. And that’s my basis for hope.
We must do something different though I know not what. A useful guide that, eh?