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Estonia clocks fastest inflation in the Eurozone at 20.1 percent

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Re: Estonia clocks fastest inflation in the Eurozone at 20.1 percent

#121

Post by jgilias »

ericmay wrote: post #103
rjzzleep wrote: post #89

Earlier quoted context omitted.

I'm sorry, but the Estonian prime minister is a Eurocrat idiot that lacks basic understanding of how either military or economy work or operate. You want to be independent of Hydrocarbons and Russian commodities? Okay well the Chinese model of silently building up the capabilities to do that is one way to approach the issue. France is an even better example of the idiocy of this as France had one of the most advanced…

> Okay well the Chinese model of silently building up the capabilities to do that is one way to approach the issue. Sure, but you also can't help chaotic, random events taking place that make any potential plans to do that go up in smoke. The alternative in this specific issue (i.e. not standing up to Russia) is likely just further dependency on oil/natural gas from Russia and eventually just being outright colonized…

If it was _just_ getting colonized, that's one thing. The alternative for Baltics is not that benign. See Mariupol, Buchi, Irpin, etc, etc, etc...

Re: Estonia clocks fastest inflation in the Eurozone at 20.1 percent

#122

Post by foverzar »

ChuckNorris89 wrote: post #97
vogre wrote: post #85

Earlier quoted context omitted.

It's easy for small country like Lithuania, but completely impossible for country like Germany. There is not enough gas without Russian one to feed its industry.

>but completely impossible for country like Germany. There is not enough gas without Russian one to feed its industry. Huh, if only they could have invested enough in their local energy sector, through I don't know ... NUCLEAR! , to keep their industry energy independent of Russia, and not shut down its few remaining nukes in the middle of an energy crisis just to appease an outdated political ideology like an absolu…

You assume that oil and gas are only used as energy components, but they are also raw materials required in industry.

Re: Estonia clocks fastest inflation in the Eurozone at 20.1 percent

#123

Post by daeroth »

sharpneli wrote: post #58
pfortuny wrote: post #41

Earlier quoted context omitted.

You can cash it out and manage your investment yourself. I interpret that small 14% as most of them doing so. Of course, I have no idea.

What happens if you essentially waste all the money? Will you be left totally without pension or will others foot the bill?

Your pension would be substantially smaller.

Technically the pension fund consists of 3 parts:

1) Shared pool of funds. Current workforce pays into the pool and current pensioners get payouts from this pool. You can't liquidate this part of your fund as there is no part that is fully "yours"

2) Individual pool - part of your salary automatically gets put into this pool and invested into the pension fund of your choosing. THIS is the part that people can now liquidate before they reach the pension age

3) Individual pool of extra deposits - You can choose to add money into this pool and incest it in a pension fund. If you withdraw funds during your pension age then no gains tax is applied on the profits. But you can liquidate the fund at any point as long as you pay the gains tax.

So these citizens/residents will only be left with the first option as their pension payments.

Re: Estonia clocks fastest inflation in the Eurozone at 20.1 percent

#124

Post by TheGigaChad »

rjzzleep wrote: post #89
jgilias wrote: post #39

Earlier quoted context omitted.

Exactly. If you notice, the second and third place are taken by Lithuania and Latvia respectively. A lot of 'cheapness' in all kinds of sectors came from RUS/UKR/BEL somewhere upstream. Building materials being a prime example. So, a combined effect of energy prices, sanctions on RUS, a war raging in Ukraine. But then, as Estonian prime minister said recently - sure, gas is expensive, but freedom is priceless.

I'm sorry, but the Estonian prime minister is a Eurocrat idiot that lacks basic understanding of how either military or economy work or operate. You want to be independent of Hydrocarbons and Russian commodities? Okay well the Chinese model of silently building up the capabilities to do that is one way to approach the issue. France is an even better example of the idiocy of this as France had one of the most advanced…

No post body was provided.

Re: Estonia clocks fastest inflation in the Eurozone at 20.1 percent

#125

Post by gruez »

forinti wrote: post #94
yodsanklai wrote: post #36

I don't understand inflation. I understand that it's a measure of the price of things, but for me there should be two types of inflations 1. a dilution of money. Let say a central bank injects a lot of new money, then all prices will be higher, but salary will be higher too, and the overall effect is neutral 2. some prices increase due to change in supply or demand (e.g. gas or cereal), but salaries and everything el…

You are right, and some central banks only use the basic interest rate as a remedy in all cases. It seems to me that case 2 cannot be solved through this mechanism. My feeling is that most media is close to financial markets and gets corralled into its point of view.

>You are right, and some central banks only use the basic interest rate as a remedy in all cases. It seems to me that case 2 cannot be solved through this mechanism.

It can. Interest rates rise -> money becomes more expensive -> investment dries up -> demand is quenched -> things become cheap again

Re: Estonia clocks fastest inflation in the Eurozone at 20.1 percent

#126

Post by throwaway4good »

tauntz wrote: post #92
throwaway4good wrote: post #12

Earlier quoted context omitted.

And exactly how would that cause higher inflation?????

It affects the income gap. People in the startup sector earn _much_ more than other sectors - the difference is, if I'm not wrong, one of the biggest in the EU. So it creates a) a lot of inequality and b) drives up prices of certain goods (houses, apartments) because there's a noticeable % of the population in the startup sector who has now their sweet exit money that's looking for a new home.

"People in the startup sector earn _much_ more than other sectors - the difference is, if I'm not wrong, one of the biggest in the EU."

Do you have a source for this claim?

I would be very surprised if that was true.

Re: Estonia clocks fastest inflation in the Eurozone at 20.1 percent

#127

Post by cgio »

itsoktocry wrote: post #80
yodsanklai wrote: post #36

I don't understand inflation. I understand that it's a measure of the price of things, but for me there should be two types of inflations 1. a dilution of money. Let say a central bank injects a lot of new money, then all prices will be higher, but salary will be higher too, and the overall effect is neutral 2. some prices increase due to change in supply or demand (e.g. gas or cereal), but salaries and everything el…

> but for me there should be two types of inflations 1. a dilution of money Outside of the fact that "some people say" (generally anti-fed types) that inflation is an increase in the money supply, why is it you think that? In economics inflation has a specific definition: a general rise in the price level. It can be caused by all kinds of things. A rapid rise in the money supply is one. A breakdown in available suppl…

I would argue that goods prices also don’t display the same elasticity going down as they do going up. Whether they are less sticky I don’t know but will definitely look into relevant literature.

Re: Estonia clocks fastest inflation in the Eurozone at 20.1 percent

#128

Post by vogre »

ChuckNorris89 wrote: post #97
vogre wrote: post #85

Earlier quoted context omitted.

It's easy for small country like Lithuania, but completely impossible for country like Germany. There is not enough gas without Russian one to feed its industry.

>but completely impossible for country like Germany. There is not enough gas without Russian one to feed its industry. Huh, if only they could have invested enough in their local energy sector, through I don't know ... NUCLEAR! , to keep their industry energy independent of Russia, and not shut down its few remaining nukes in the middle of an energy crisis just to appease an outdated political ideology like an absolu…

Why would they do it? Russia never failed delivering cheap gas.

Re: Estonia clocks fastest inflation in the Eurozone at 20.1 percent

#129

Post by pessimizer »

anonymousDan wrote: post #75
toxik wrote: post #43

Earlier quoted context omitted.

That is completely normal, though. Inflation is not the exact price adjustment of every basket of goods over time, that is simply not possible to represent in a single number - rather, it is some arbitrarily chosen basket of goods meant to represent an average household. It does not have to be perfect to be meaningful.

The problem is it is not necessarily arbitrary - governments can pick a basket that masks inflation in areas that it wouldn't suit their agenda to highlight.

"Arbitrary" means "picked." It doesn't mean "random" (although you certainly can pick things randomly.) The alternative to arbitrary choice is systematic choice i.e. having a set of specific meaningful criteria that determine something.

So I agree with you, but the problem is that it is arbitrary, and the arbiters could be rigging the outcome with their choices.

Re: Estonia clocks fastest inflation in the Eurozone at 20.1 percent

#130

Post by state_less »

karlerss wrote: post #96
state_less wrote: post #68

Can anyone confirm mortgage rates in Estonia? This site[1] says ~ 2% mortgage rate, which means a -18% real rate, further pushing demand for real assets instead of paper debts. I think the US is closer to neutral, but we still have a negative mortgage real rate at the current inflation level. 1. https://www.theglobaleconomy.com/Estonia/mortgage_interest_r...

Can confirm. Mine is 1.63% + 6mo euribor rate (which was just raised over 0%). When you have the future possibility of 5% mortages, people will think twice about buying the currently expensive real assets. On the other hand - can't say that real estate is exactly overvalued - recently they've been driven by rising construction and material costs.

Thanks for confirming euro folks. Good luck on the other side of the pond - hopefully we’ll stabilize these prices over time.
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