France understands markets well then

“We are opting for a kind of inflation-indemnity of €100 … which will be paid to French people – it’s a sort of a middle class-indemnity,” prime minister Jean Castex told TV station TF1 on Thursday night.

This will affect some 38 million people, he said, adding that “petrol prices will be frozen for the whole of 2022”.

We’ll increase real demand by handing out cash and prices will stay the same.

Sigh.

5 thoughts on “France understands markets well then”

  1. Rumour has it the chancellor is considering cutting the 5% VAT on domestic energy bills, which is even worse than Macron’s bung: heavier users would get a bigger discount.

  2. During the great butter crisis of a few years ago, supply shortage led to wholesale prices going up and supermarkets refusing to pay the higher prices and put their prices to consumers up, the result was empty shelves in many. However many stores had butter on ‘promo’, 30% of second pack, 50% off third pack: often the signs were on shelves where there there was no more stock.

    The French do not understand economics.

  3. Nicolás Maduro must be loving this. Short of bombing the most effective way to destroy an economy. Lyndon B. Johnson could have brought North Vietnam to its knees quite quickly by combining bombing and price controls.

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