Even if you blame this on NATO, which I don’t, it seems to have all but crippled Russia. Russia had an economy smaller than Texas. Today it’s economy is potentially smaller than Florida’s or Mexico’s. This was a colossal fuck up by Putin and the western powers didn’t even need to fire a bullet.
It's not entirely painless for the West, given Russia's key position as supplier of wheat, fertilizer, and natural gas. Inflation will be kicking around for a while (even without trillion dollar stimulus programs) and creating economic distress for most.
I don't think we have even started to experience the truly massive food price shocks.
Was listening to a farmer talk the other day about nitrogen, phosphorus, and potassium. These prices are going through the roof, in some cases, 300% or higher increases.
The price shocks are going to hurt lots of people. Their people. Our people.
In the short term. By short term I mean historical short term. Anything less than 10 years is short and insignificant. Hopefully by then the entire world can be independent of Russia in perpetuity and it can wither away completely isolated from the West for eternity.
> Oil is 30% of Russia's exports but wheat is a wee 2%. What if it grows to 20%, with tenfold price increase?
Oil/Fuel is not the only exports, as many petroleum/gas based products are not fuel [1]
If fertilizer is one of the majority costs of growing food in the US, and we cut out 50% of the world's supply, then our costs will go through the roof. Uneffected suppliers such as our friends to the North in Canada will also raise their prices, as supply/demand curve will change.
While I know most of us technical folks are well compensated, there are lots of poor people working paycheck to paycheck. A big price shock could mean some people starve.
It will also hurt Europe when it comes to migration. Much more expensive food means potential famine in large swaths of Africa and in some places in the Middle East, means people willing to risk it all in order to escape famine, means migration to Europe at any costs.
Considering the US economic & cultural war on Russian citizens is still ramping up, we don't know yet how this will effect the USD status as reserve currency.
Whether Russia wins, or loses this war, in the long run it is clear: The US hegemony is in peril, and China will gain massive benefits from this.
