A student of Austrian Economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open-source systems, network effects and the intersection between economics and cryptography.
The CEO of Almonty Industries has warned that it could take the Federal Reserve 10 years to get inflation under control if they do not act now and stop spending money. “And they need to raise rates. That’s the only tool that works,” he said.
Almonty Industries CEO Lewis Black discussed the state of the U.S. economy and inflation in an interview with Kitco News this week.
Almonty is a global mining company focused on tungsten mining and exploration. Black has over 15 years of experience in the tungsten mining industry. He recently explained that one key use for tungsten is in the batteries used in electric vehicles. “Tungsten is used in anodes and cathodes in batteries, helping vehicles charge quicker,” he said.
While noting that the Russia-Ukraine war is directly contributing to the recent inflation surge, the executive pointed out that many commodities were already near record highs before Russia began its invasion of Ukraine.
“We already had disruptions, and governments worldwide have printed so much money. When you inflict on the economy so much money, it creates inflation,” Black explained, adding:
The fashion right now is to blame Putin. And some commodities have rallied on the back of the invasion. But some were already at all-time highs or near those highs before that.
“Inflation is going to ultimately continue. The first step to recovery is an acknowledgment of your problem. And until that happens, things will continue to spiral out of control,” he stressed.
The chairman of the Federal Reserve, Jerome Powell, admitted Monday that “inflation is much too high.” He stated that the Fed “will take the necessary steps to ensure a return to price stability,” adding that it will raise the federal funds rate by more than 25 basis points if appropriate.
They have to get inflation under control. If it gets out of control, it can take you a decade. It is imperative to act now — stop spending money and reduce the amount of money you circulate as a government.
“And they need to raise rates. That’s the only tool that works,” he further suggested.
The Almonty executive added, “There is a real risk of shortages in the short term due to exacerbated disruption to the supply chain.”
“Supply chain disruption reduces the availability of products. And if you reduce the availability of products, you reduce consumerism, which helps steady inflation. If you can’t buy it, you can’t spend it,” he detailed. “And that involuntarily restricts the flow of money. That may stabilize or at least slow the inflation rate quite dramatically.”
Supply shortages will lead to slower growth. “The economy is going to take a back seat. These factors will help slow inflation, but you will see this go into 2023,” Black concluded.
How long do you think it will take the Federal Reserve to get inflation under control? Let us know in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.