The Debt Russia Freeze

The Debt-Russia Freeze: German Inflation at 50-Year High. UK Foods Spike.

It’s climbing in Europe c reports The Guardian: overall inflation in Germany nears the 50-year high; meanwhile, bread, noodles and crisps are among the largest food spikes in the UK.

As we predicted and still predict will worsen globally after a five-year low in inflation 7 years ago, in Germany things have reversed, regarding budget items: noodles, bread, chips, and beef mince, whose prices rose the fastest, according to the ONS. 

Leading to the German government intervening, to allow commuters to travel for just €9-a-month.

And as for the UK? According to new research: the price of bread, potato chips, and pasta jumped in cost for the British. These budget, ‘family selection’ of foods are among the most popular, and a rise in their cost is now among us and predicted to worsen. But why?

How Inflation Affects Food Prices

Analysing price changes for more than 1,200 products at 350 supermarkets in April, the Office for National Statistics found that some grocery items cost more over the year than others - with cheap groceries surging faster than the general inflation rate.

Inflation is a rise in the general level of prices for goods and services in an economy over a period of time. It’s a gradual process that occurs when demand for goods (or services) outpaces supply. When this happens, businesses have to increase the price of their products or services to make a profit.

Consumers also have to pay more for everyday items, such as gas or food, because the money in their wallets becomes worth less over time. Inflation happens when the supply of goods and services doesn’t keep up with demand.

In other words, the economy creates more goods and services than the people who want those things can buy at one particular time. Businesses then have to find a way to get rid of all this excess inventory.

In a deflationary environment, when the supply of goods and services outpaces demand, the opposite happens: businesses have excess inventory and have to find a way to get rid of it.

Inflation is a big deal for consumers because it means that prices for some of their everyday items are going to rise. And because those prices are going up quicker than wages are, it’s going to be especially difficult for consumers to save money (see: the “seven baby steps”).

[Saving is a strong defence in a debt economy, although it takes practice.]

When inflation happens, even if wages remain the same, the cost of living goes up. That means that if you want to keep up with your friends and family, you will have to find other ways to save money, or cut down on your spending. In order to keep up with inflation and keep your spending under control, consumers can try to make sure that they are buying food items that are not going to cost them as much.

Why Inflation is Bad for Food Prices

When you have inflation, you don’t know how much something is going to cost in the future. There is nothing predictable about what prices are going to be like. If you are trying to forecast how much money you are going to have in a year from now, there is no way to do that without using some type of equation. 

When you forecast using an equation, you are taking into account many different factors. You are taking into account what the government is doing, what the Federal Reserve is doing, and what the economy is doing. 

This equation helps you to predict what prices will be like in the future. If you have an equation that is telling you that prices are going to go up, then you are probably going to start stocking up on food items that are not going to cost much in the future. You might want to put a lot of vegetables in your fridge because they are going to be cheap in the future.

You might also want to grow a small backyard allotment and increase your local community contacts. But most importantly, don’t panic. 

The Downside of Inflation for Grocers and Consumers

Inflation is bad for retailers, too. If you have to charge more for an item every year because of inflation, then you have to find other ways to make more money. So you might start selling more add-ons, like coffee for your customers after they buy their groceries. 

Or, you might have to start raising the price on the food items that are most popular, like the popular meat item on your grocery store’s hot bar. When you have to raise the price of your most popular items, like the hot bar item, then you have to turn away more customers than usual. 

You can’t just put a sign up that says “sorry, we don’t have enough money to keep the hot bar stocked.” You have to do something more creative, like putting the hot bar item in the back corner of the store so that customers have to walk by to get to the front of the store to buy something else.


Overall, the Office for National Statistics found that, on average, the cost of 30 common groceries rose 6 percent during the year, matching the 6.7 percent annual average inflation rate in food and nonalcoholic drinks.

So for now, this seems to be limited to certain budget items but — particularly with much of Europe at freeze in their relations with Russia, who has control of much of the world’s supply of oil and gas — unless Europe comes to an agreement with the major commodity supplier, many could freeze to death when winter comes.