Here is a simple example: human stomach, house's pantry or even a two car garage have their spacial limits which translate into the calories. I, theoretically, can eat a good size (12 oz.) rib-eye steak with sides without making me sick. I also, theoretically, can stuff our pantry and garage with finite amount of canned and dry food. Pay attention--finite. Beyond that, consumption, as in eating, stops making sense under the conditions that that food could still easily be bought in a grocery store, while I run out of space. As in "having no more...well, space, length x width x height, as in volume, as in...whatever. I don't know, in this particular case, what is the level of business "analysts" in Saudi Arabia (the case of oil freight going up 1000% is yet to be presented in the "Saudi's Dumbest Economists" TV Show) but let me stress that this, greatest meme of all:
was born on Lavrov's pressy together with....Saudi Foreign Minister. So, maroons in Riyadh are yet to learn that the more you saturate market (or sponge), the less it can take in. So simple, almost 2 x 2 =...5 or something like that. Meanwhile, those nasty Rooskies, who without much pomp, finished....remember this? Or you may, using Google Translate, take a look at this:
Translation: Oil Pipe "Eastern Siberia--Pacific Ocean Reaches Maximum Capacity".
It is also duly noted in WSJ that Russia managed to reroute its oil to China where demands is growing back. My question, again, is this: do those people even read news or look at the map?
Did Saudis actually check China's demand even today? Well,
Oh, I am having fun today. Can I?
So, Saudis can saturate oil market whatever they want, or are capable of, which is not for very long, but Moscow is unimpressed, neither is Beijing, methinks, who doesn't mind some cheap sweet oil. Me and Arctic Fox already exchanged about Bretton Woods 2.0 and it seems there are more people who think along those lines in a face of a new Great Depression (no, this is not a typo).
No shit (again), pardon my French. No, not "could", it was and is happening as I type this, de facto, and de jure will not be far away once shit REALLY hits the fan in the United States. And gigantic masses of excrement are on the final approach to the increasingly fast rotating blades of the economic collapse the likes of which we didn't see yet. Historic, really. They even say it (at least they are trying) as it is:
One concern is that monetary policy in the U.S. – actions by the Fed to maximize domestic employment and keep prices stable – reverberates through countries all over the globe, often saddling them with higher inflation whenever their currencies weaken versus the dollar; while exporters of raw materials or manufactured goods might become more competitive, consumers feel the pinch from higher prices for imported goods. Another factor is that so many commodities such as oil, copper and gold are priced in dollars, leaving producers including Russia, Brazil and South Africa at the mercy of foreign-exchange markets.
OK, let me be even more direct: the MAIN American export in the last decades (apart from export of the most democratic democracy, like ever) was...inflation, which was generously spread around the world. This time is over. But I want to stress it again: this was OVER even before Covid-19 hit the fan, it was over much much earlier. So, what is in store for all of us HERE, in the US, or North America generally. I don't really know in economic terms other than it is getting tough and will make 2008 look like a picnic, albeit even then food-banks ran out of food pretty fast. My main concern here is the one I never made a secret of--we must avoid a war. By all means, after that it is the matter of time and patience, and, hopefully good District Attorneys and Attorney General for leveling charges against those who defrauded and raped not only America, but globe too. But we'll get there when we get there, hopefully. In conclusion, however, I again will post a quote from brilliant Corelli Barnett. Just read it attentively, take it in--this is what America is paying now and will be paying even more for:
"… swift decline in British vigor at home and the failure to exploit the empire were not owing to some inevitable senescent process of history....That cause was a political doctrine....The doctrine was liberalism, which criticized and finally demolished the traditional conception of the nation-state as a collective organism, a community, and asserted instead the primacy of individual. According to liberal thinking a nation was no more than so many human atoms who happened to live under the same set of laws....It was Adam Smith who formulated the doctrine of Free Trade, the keystone of liberalism, which was to exercise a long-live and baneful effect on British power....Adam Smith attacked the traditional "mercantilist” belief that a nation should be generally self-supporting…"