I've been saying for quite some time that high inflation will soon cause labor demanding higher wages - and it is already happening. Labor unions have been losing power to employers for decades, but conditions are now ripe for their resurgence.
The close relationship between high inflation and labor actions is intuitively obvious and can be demonstrated in the two charts below. With inflation now back to 1980s highs, will many more strikes soon follow? I believe they definitely will.
And when they do, politicians will abruptly switch allegiance from the corporate suite to the street. The Era Of Markets is clearly over.
PS In the 1970s and 1980s it was pre-Thatcher UK that led the world in strikes. I'm not sure if we will see a repeat, since the UK is no longer an industrial nation, but after Boris the Menace the Conservative party is in disgrace and tatters. Can Labor make a strong comeback in an economy based on financial services? If it can transform itself into New-New Labor, focusing on climate change and health services, yes it can.
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