The European economy is in agony. I have shown you the charts. As gas prices skyrocket:
Electricity prices do too:
Then the inflation shock follows:
UK inflation could top 22% next year if natural gas prices remain elevated in the coming months, Goldman Sachs Group Inc. warned.
The prediction is the latest startling forecast for the severity of the crisis that’s unfolding in the UK, with hopes fading that inflation will peak in October. Goldman’s outlook is even more gloomy than a prediction last week from Citigroup, which price gains peaking at 18.6%, well above the 13% figure the Bank of England forecast earlier this month.
The real income shock trashes the poor:
Elderly Britons are set to welcome a boost of around £1,000 to their state pension payments next year thanks to the return of the triple lock, however the cost of living crisis will still leave them significantly poorer.
However, the price cap for energy bills will rise by 80 per cent to £3,549 in October, and it is predicted to rise over £6,600 next year according to Cornwall Insight.
Higher energy bills often hurt pensioners significantly more than the rest of the population because they spend a greater amount of their income on heating their home.
And all business:
🚨🚨UK ENERGY CRISIS🚨🚨
“My mum owns a small café in Leicester. Her electricity bill has just jumped from £10k ($12k) a year to £55k ($64k) a year. She is working out her options but more than likely she will be forced to close.” — via https://t.co/OVolT5HHVr pic.twitter.com/dGedhwCimS
— Crab Man (@crabcrawler1) August 30, 2022
And then comes the kicker, from Goldman:
BOTTOM LINE: Given today’s stronger-than-expected inflation data—together with hawkish commentary and upside risks to near-term growth—we now expect the Governing Council to hike by 75bp at the September meeting, and upgrade our forecast for the terminal rate to 1.75% in February 2023.
While the dictator tightens the screw even more:
Russia has completely halted gas supplies to Europe via a major pipeline, saying repairs are needed.
The Russian state-owned energy giant, Gazprom, said the restrictions on the Nord Stream 1 pipeline would last for the next three days.
Why is Australia exposing itself to this fallout? Unlike Europe, we have unlimited gas. Yet the price today is still 150% higher than it should be at $19.50Gj and electricity prices are up by roughly the same:
The shock is already arriving here with utility bills still likely to rise by half over the next year, adding 2% to the CPI. But, it is only this good owing to the one-month shuttering of one of six LNG export trains in QLD. The moment it reopens on September 4, the cartel will tighten the local market for gas and our prices begin to chase European again.
This makes Albo’s entire agenda ludicrous:
- His climate change policies will fall apart as the price shock wrecks public support.
- His wages policies will be swept away by a tsunami of inflation.
- The economy will crash with house prices as the RBA hikes like a raging bull.
It will literally throw Albo’s cowards out of power in one term even if they are standing against Ronald MacDonald.
Yet, the woman in charge of fixing it with the stroke of a pen by installing a $7Gj price trigger into domestic reservation or an export levy, Resource Minister Mad King, still “hasn’t decided” whether she’s going to do it.
FFS, what’s to decide? Do it or die.
