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The shipping container shortage that’s wreaking havoc on the global supply chain
Spare a thought for the poor shipping container, responsible for most of the world's trade. It's had a rough year that started with the gargantuan Ever Given getting stuck in the Suez Canal.
Now the Suez traffic jam has gone global.
When the pandemic started, everyone needed COVID supplies from China. Chinese factories couldn't keep up with soaring demand from Western nations, and empty containers started to pile up in faraway ports.
Sending one of these ships from Shanghai to Los Angeles has jumped more than ten-fold from $2,000 to $25,000.
And as demand increases even more, the problem is getting worse — a vicious cycle with no end in sight just as the holidays approach.
Watch this episode of GZERO World with Ian Bremmer: Inflation nation: What's driving US prices higher?
Subscribe to GZERO on YouTube to be the first to see new episodes of GZERO World with Ian Bremmer: https://bit.ly/2TxCVnY
How economist Larry Summers predicted US inflation
Back in February, Larry Summers was sounding the alarm bell about inflation when no one was talking about it.
"It seemed obvious to me that we were gonna have massive demand, and we weren't gonna have such large supply."
So why didn't anyone listen to him? Summers says that "cognitive biases" led many to ignore the inflation warning signs because they thought struggling families needed help, or believed that inflation was simply gone for good.
Part of the reason prices are rising so much today, Summers says, is because the Biden administration made the political decision to do "too much stimulus," a big mistake in his view.
Watch this episode of GZERO World with Ian Bremmer: Inflation nation: What's driving US prices higher?
Subscribe to GZERO on YouTube to be the first to see new episodes of GZERO World with Ian Bremmer: https://bit.ly/2TxCVnY