Money printing and supply chain problems are a lethal cocktail for inflation
Posted: Mon Jan 06, 2025 8:13 am
Inflation has been rampant for months now across the globe . The absolutely untamed growth of inflation is putting not only ordinary consumers (seriously battered for some time by the so-called "redeflation" ) in serious trouble, but also businesses, whose existence could, in fact, be endangered in the medium term.
Does current inflation really mean the end of economic and business prosperity? Where does this phenomenon come from? Scott Galloway , a marketing professor at New York University, answers these and other questions in an interview with W&V , where he shares his characteristically outspoken style (and once again launches some very harsh barbs against “Big Tech”).
According to Galloway, the inflation we are currently experiencing arises when there is too much money going after too few goods. But why is this happening at this very moment? “A fairly obvious answer to this question is cash. When the pandemic hit two years ago, we pumped a lot of cash into our economies to artificially prevent a crash. This is not, however, the whole story. One of the most important things we have learned during the pandemic is how incredibly complex and fragile supply chains are,” explains Galloway.
" Supply chains have been in balance for years and are not designed for the current extreme volatility . Money printing on the one hand and supply chain problems on the other are the perfect combination for saudi arabia number data massive price increases," says the New York University professor.
As for possible solutions to curb inflation, Galloway says that all of these solutions will be painful . “We have a very useful tool at our disposal to combat inflation: interest rates. Raising interest rates is not the most popular solution in the world, but it puts a spanner in the works of lending and credit and reduces consumer spending,” he says.
Asked which companies have the most to gain from current inflation and which will emerge from this crisis as the biggest losers, Galloway is clear. “ The winners in this story are those who are already winners in most stories: the big companies with a comfortable financial cushion. An extremely inflationary environment will inevitably force a recession that will eventually sink companies with fewer financial resources. This group includes companies that are still in the growth phase and that must face high levels of expenditure with little cash at their disposal,” says Galloway.
Big Tech will emerge stronger from the current inflationary trend
The economic storm caused by inflation will certainly be weathered by the big tech companies. “ Big Tech will survive and when the recovery starts again, they will grow again. These companies always win ,” says the New York University professor.
Galloway ventures that, despite the current inflationary environment, there is no need to say goodbye to the idea of constant growth. “There is always room for growth and markets have an enormous capacity to make the most of technology and talent. Let us not, therefore
Does current inflation really mean the end of economic and business prosperity? Where does this phenomenon come from? Scott Galloway , a marketing professor at New York University, answers these and other questions in an interview with W&V , where he shares his characteristically outspoken style (and once again launches some very harsh barbs against “Big Tech”).
According to Galloway, the inflation we are currently experiencing arises when there is too much money going after too few goods. But why is this happening at this very moment? “A fairly obvious answer to this question is cash. When the pandemic hit two years ago, we pumped a lot of cash into our economies to artificially prevent a crash. This is not, however, the whole story. One of the most important things we have learned during the pandemic is how incredibly complex and fragile supply chains are,” explains Galloway.
" Supply chains have been in balance for years and are not designed for the current extreme volatility . Money printing on the one hand and supply chain problems on the other are the perfect combination for saudi arabia number data massive price increases," says the New York University professor.
As for possible solutions to curb inflation, Galloway says that all of these solutions will be painful . “We have a very useful tool at our disposal to combat inflation: interest rates. Raising interest rates is not the most popular solution in the world, but it puts a spanner in the works of lending and credit and reduces consumer spending,” he says.
Asked which companies have the most to gain from current inflation and which will emerge from this crisis as the biggest losers, Galloway is clear. “ The winners in this story are those who are already winners in most stories: the big companies with a comfortable financial cushion. An extremely inflationary environment will inevitably force a recession that will eventually sink companies with fewer financial resources. This group includes companies that are still in the growth phase and that must face high levels of expenditure with little cash at their disposal,” says Galloway.
Big Tech will emerge stronger from the current inflationary trend
The economic storm caused by inflation will certainly be weathered by the big tech companies. “ Big Tech will survive and when the recovery starts again, they will grow again. These companies always win ,” says the New York University professor.
Galloway ventures that, despite the current inflationary environment, there is no need to say goodbye to the idea of constant growth. “There is always room for growth and markets have an enormous capacity to make the most of technology and talent. Let us not, therefore