The War In Ukraine Is A Manufactured Distraction
For weeks I thought it was all just posturing. For weeks, I figured that Biden would work out some sort of diplomatic solution. I could not help but think of every headline about the buildup of troops at the border of Ukraine as a way of making us feel more comfortable with war. I saw the headlines about the phone calls between Biden and Putin, and I hoped that both sides would conclude that war is not worth the cost.
Today I see that I was wrong. Now I see the headlines of war. I see the pictures of explosions and troops with dirt on their faces. I think of the timing. I think of the message. It seems like the war is on cue.
We’re in a midterm election season now. Inflation is high. Democrats are teetering, fearful of a difficult election ahead, fearful of massive losses. Even with very positive redistricting results so far, Democrats could still suffer heavy losses. But this war. It seems like a timely distraction, almost as if Vladimir Putin, President of Russia, is trying to do someone a favor.
He could have waited for later. Putin almost certainly knows the polling isn’t looking well for Democrats. He also knows he has an ally in Trump. Starting a war now could put Biden on his heels and make the Democrats look weak. But there is something else.
In a tiny Reuters article, there is a murmur to suggest that the war in Ukraine could do what the Fed couldn’t do alone. The war could help to bring the temperature down for the world economy, and bring inflation to heel. Honestly, I don’t know exactly how that could happen. Reuters quoting the New York Fed president, John Williams:
“My expectation is that we can manage, if you will, the soft landing we often talk about in monetary policy, which means keeping the economy basically in a strong place and growing,” while restoring more balance between supply and demand, Williams said during a virtual event organized by New Jersey City University.
That article had just two paragraphs, and I quoted the second one. It’s almost like it’s a secret code to investors. “If I wave my hands like this, bail. If I wave my hands the other…