By Craig Erwin, Ph.D.
I went to a dollar store earlier this week. It’s no longer a dollar store; it’s a $1.25 store because everything in the store is now $1.25. But it’s not just dollar stores that are seeing prices rise; gas prices and the prices of many luxuries and necessities are shooting up as well.
678,000 jobs were filled in the U.S. in February, presumably as people traveled, shopped, ate, and drank more after being trapped at home by Covid-19 for the past two years. This hiring surge spanned most sectors of the economy, including restaurants, bars, hotels, construction, transportation, and warehousing. Although such a buoyant job market is cause for celebration, the jobs numbers were counted before Russia invaded Ukraine, sowing death and destruction, so we must not read too much into them. Although the U.S. economy appears to be booming, all nations’ economies are now at risk due to the war and sanctions Western powers put in place to punish Russia.
Western governments have successfully cut the Russian economy, the 11th largest in the world, off from the rest of the world in a week. Countries planning to import Russian oil or grain will find it difficult to do so. Thanks to global sanctions, Russian tankers, cargo ships, and bulk carriers are now stranded at their ports or at sea. Making exporting even more difficult for Russia, Western powers have frozen the assets of Russia’s biggest banks, making it nearly impossible for Russian shippers to issue or receive payment.
Sadly, just when it seemed the world would emerge from its Covid-19 cocoon and spring to life, there is instead suffering, bloodshed, and great economic uncertainty.
Are you following the events in Ukraine? How do you think the war will affect you? Do you think Covid-19 is still a big concern? Are you concerned about the global economy?
For more information on the war in Ukraine, the U.S. economy, and the global economy, click on the following links: