High oil prices are a symptom of economic and monetary imbalances, not just a consequence of OPEC decisions. Throughout history, we have seen how OPEC cuts have done little to elevate prices when diversification and technology added to rising efficiency.

Likewise, OPEC output increases do not necessarily mean lower prices, let alone reasonable ones. OPEC helps but does not solve price issues, even if they would probably like to.

The problem in the oil market has been created by years of massive capital misallocation and underinvestment in energy created by extremely loose monetary policies directed by governments that have penalised capital expenditure on fossil fuels for ideological reasons.

What is the worst thing a government can do when there is high inflation and supply shortages? Multiply spending on energy and material-intensive areas. This is exactly what the US infrastructure plan is doing and -even worse- what other developed nations have decided to copy.

If you thought there were problems of supply and difficulties to access goods and services in the middle of a strong recovery, imagine what will happen once central banks and governments turn the printing machine to maximum level to spend on white elephants.

There is no such thing as “multi-cause inflation”. What Biden calls “speculation” is simply more money going to the same number of goods. So-called “supply chain disruptions” is more money to the same services, and “cost-push inflation” nothing else than more money created to bloat government spending and “infrastructure” plans to the same number of goods. As one of my followers explains, “more credit issued for GDP related purposes chasing the same amount of goods and services”.

No economy has been able to ignore a property bubble and even less so offset it and continue to grow replacing the bust of the real estate sector with other parts of the economy. Heavily regulated economies from Iceland to Spain have failed to contain the negative impact of a real estate sector collapse. It will not be different in China.

China’s real estate problems are three: The massive size of the sector, its excessive leverage, and the amount of developer debt in the hands of average households and retail investors.

No government looking to massively expand its size in the economy and monetize a soaring deficit is going to act against rising prices, despite claiming the opposite.

One of the things that surprises citizens in Argentina or Turkey is that their populist governments always talk about the middle classes and helping the poor, yet inflation still soars, making everyone poorer.