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Multibillionaire and Bitcoin fan
: Jack Dorsey likes to maintain the habitus of a hippie
Photo: GREG NASH / AFP
Problems in the global supply chains and the phenomenon of scarce goods, which are currently driving inflation, could continue well into the coming year, admitted US Federal Reserve Chairman
Jerome Powell
(68) on Friday evening during a panel discussion. So is high inflation here to stay? The Fed chief does not believe that, should the bottlenecks resolve, the price increase should also approach the target of 2 percent again, he repeated. In view of consumer price inflation, which is close to the 30-year high at over 5 percent, many observers in the USA no longer really want to believe this narrative. Warnings of galloping inflation are mounting.
Inflation expectations on both sides of the Atlantic are still holding at two percent. But should they break away from this mark, it might be too late to take countermeasures, and the much-cited "tight reins" - that is, an exit from bond purchases and interest rate hikes - might no longer be sufficient to reverse the price spiral.
There is growing concern that something has changed structurally: If globalization and digitalization had kept wages in check and thus inflation within limits, things could now turn around, according to the statement. Globalization is on the decline, customs barriers are rising, trade restrictions are increasing, and at the same time national security of supply for certain goods is coming to the fore - all of this is driving up costs and thus prices, just as the fight against climate change brings with it green inflation could.
Some apologists even see "hyperinflation" emerging - that is, inflation with double-digit monthly price increases.
Twitter boss
Jack Dorsey
(44) has now oracle: Hyperinflation will come, first in the USA and then in the whole world and it will change everything.
That sounds cryptic and scary.
Now you have to know: Dorsey is not only the head of Twitter with at least 200 million daily users, but also a well-known advocate of cryptocurrencies.
With Square, he runs a financial service provider that enables its users of the "Cash" payment app to buy and store Bitcoin.
According to Dorsey, Square is also considering mining the cryptocurrency.
The fact that Bitcoin has recently soared again and climbed its highest level so far at around $ 66,000 in the past week has not just one cause. But it is also clear that the fear of rapid inflation is one of the reasons for the success of the digital currency. This fear can be capitalized on.
"Fear of inflation, if not hyperinflation, helps explain the meteoric rise of Bitcoin," wrote Bloomberg Businessweek earlier this year. Behind it lies a "distrust of the Fed" and stirs up the opposition to the huge pandemic aid programs of the US government. The author warns that not only cellar bloggers and Reddit activists have long been speaking out against hyperinflation, but also hedge fund managers and right-wing conservative politicians in the United States.
The "talk" that the US could face hyperinflation in the long term like in Zimbabwe or Venezuela is "nonsense", simply "meme economy".
However, repeated statements from interested parties influenced the perception.
You could push the markets and politics in a problematic direction.
The author warns that the more Fed Chairman Jerome Powell assures that inflation is manageable, the more he alarms those who believed he was dangerously wrong.
If this "contagious meme spreads" and inflation expectations begin to rise, Powell may be forced to hike rates prematurely and "burst the inflation balloon at the expense of growth and jobs."
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