The European Central Bank(ECB) just raised interest rates, and signaled further rate increases likely to come this year – Higher Rates and the EU Tax and Regulate problem – July 21, 2022,

Different people detail the European Union and its economy in different ways what I focus on when it comes to the EU are their tax and regulatory policies, which are very Marxian in that they’re PROTECTIONIST and anti-growth. Now, I don’t think EU member States are INTENDED to be anti-growth; it’s just that there are a lot of believers in Socialism in Europe, and many of them have helped to craft anti-economic-growth laws.

When a Left Wing Socialist creates laws with the goal of “social justice” they imagine the MARKET or the economy as secondary to their social justice cause. Now, prior to climate change hysteria becoming a thing, Europe had a lot of other social justice causes, and labour unions are HUGE in places like Germany. Anyone who ever did business in Germany knows about PERMITS.

The Germans regulate everything they can find, and I want to be aware that Germany is the most IMPORTANT economy in the EU if their economy is overly regulated, imagine countries like Italy? France, the Netherlands etc. Recently the Dutch government laid out targets for reducing nitrogen pollution in some areas by up to 70% by 2030.

Now, why would the Dutch government be so stupid? Well, it’s because they were stupid DECADES ago and got away with it. You see, when you support Big Government initiatives that destroy SOMEBODY else’s business, you never imagine that one day the Big government will come after your livelihood too!

So in many parts of Europe, growth is STAGNANT because, for every dumb Big Government idea, the accommodative European Central Bank(ECB) either lowered interest rates or kept them where they were, which signaled to the market that a lot of the PRIOR dumb ideas were indeed sustainable and all investors would have to do is wait it out so that eventually as an example these solar panels, wind farms and biomass developments could phase out fossil fuels?

Late Stage Environmental Socialism

Well, now consumer price inflation is running rampant; why? Because the Climate change alarmists want large-stage capitalism RIGHT NOW😱. The earth is warming, and it’s the fault of fossil fuels; so the government must give money to these special interest groups who promise to fix climate change right away and phase out fossil fuels as soon as possible.

Being that even the Left Wing and Conservative politicians in the EU are on board with this silliness, the cost of living has shot up. Making matters worse, leading up to 2022, countries like Germany gave away their ABILITY to produce DOMESTIC energy YEARS ago, meaning that consumer price inflation for as long as this climate hysteria continues will be BAKED into the COST structure of most EU nations regardless of high-interest rates go.

Because of all of this big government stupidity, the Bond markets in the U.S, as an example, are calling the Central Banks’ bluff. What I’m getting at is that a lot of professional investors think rates are going up temporarily only to come right back down again, meaning this rampant consumer inflation you’re seeing now is PERMANENT.

I can’t blame people for thinking this, but my position is that we’re headed for AUSTERITY MEASURES; why? Because we’re on a PETRODOLLAR standard. I’ve been writing about the Petrodollar for years now; some say it’s fake, but I say it’s very REAL. If you like your standard of living, then you love OIL. Could a replacement for oil come about in the future? Sure, but it’s not here yet. I’ve written about alternatives to PLASTIC existing on the market, but it’s only for CERTAIN plastics.

I mention all of this because if you’re phasing out the oil, you’re, in actuality, ATTACKING THE WELFARE STATE! This is something most people do not understand, the welfare state is HEAVILY dependent on Oil, so if you want to phase it out, as Joe Biden has said, I hope you’re aware that your retirement is at risk, because not only are these lunatic leftists attacking oil, they’re going to war with people who even think about investing in oil.

The EU has what I call a very REGRESSIVE tax structure. They’ve not only over-regulated themselves, but they also PUNISH consumption. So as their economy slows, and people consume less while spending more, this doom loop can be disastrous with no hope in sight except for AUSTERITY MEASURES! Europeans love their welfare state and what I’m getting here is that their leaders on this path are going to DESTROY IT!

ECB raises rates for first time in decade with safety net for debtors | reuters.com

Interesting times ahead!