By David Stockman 

Europe’s impending depression is not to be discounted in terms of its relevance to this side of the Atlantic pond. Since the turn of the century, US exports to the European Union have soared from $12.3 billion per month to $30.4 billion. That latter amounts to $365 billion on an annual basis.

Needless to say, when European GDP descends into a double-digit slide, demand for US exports will plunge, causing declines in production and employment on this side of the Atlantic.

US Exports To The EU, 2000-2022

What looms on the far side of the pond, of course, is the possibility of an inflation-driven depression in Europe. Already the headline CPI has practically gone into orbit, posting at 8.9% Y/Y in July.

And today the August flash CPI came in even higher: To wit,  headline HICP inflation rose  another 21bp to 9.08% Y/Y.

As shown below, recent inflation readings dwarf anything Europe has experienced in recent times, meaning that consumer purchasing power is being drastically reduced.

Y/Y Increase In Eurozone CPI, 2014-2022

But faltering consumer purchasing power is barely the half of it. The fact is, Europe’s industrial sector is natural gas driven, exposing it to a devastating cost-price crunch owing to the region’s suicidal sanctions on Russia and the resulting collapse of Russian pipeline gas supplies.

Not surprisingly, the EU will now convene an emergency meeting of energy ministers as gas prices spiral higher, hitting an all-time European high last Friday and threatening to send the region’s economy into the drink.

This desperate call came as European gas prices hit a record high above €343 per megawatt hour ($100 per MCF) or 30X the normal US price on Friday. That culminated a week in which Europe’s benchmark gas price had soared by almost one-third as traders and utilities rush to secure supplies ahead of the winter.

The resulting stark threat to energy-intensive industries is self-evident: The cost of Nat Gas has risen 14X since mid-2021.

As a consequence, Nat Gas-intensive industries are simply shutting down due to the prohibitive cost of process fuel. For example, the region’s fertilizer industry association on Friday warned that 70% of production in Europe has already been curtailed by high gas prices, illustrating how the energy crisis is rippling across industries and threatening sectors from glass-making to food production and metals smelting.

Likewise, the cost of electricity has surged to record highs in Europe during the past week, paving the way for painfully high consumer rates across the continent through the winter and well beyond.

Overall, the entire Eurozone, as well as the United Kingdom, faces the worst cost-of-living crisis in modern memory.

Not surprisingly, therefore, over the past week, shocked Europeans – mostly in the UK and Ireland – have been posting viral photos of shockingly high energy bills amid the ongoing (and worsening) energy crisis. As Zero Hedge noted,

Several of the posts were from small business owners who getting absolutely crushed right now, and won’t be able to remain operational much longer.

One such owner is Geraldine Dolan, who owns the Poppyfields cafe in Athlone, Ireland – and was charged nearly €10,000 (US$10,021) for just over two months of energy usage.

Geraldine Dolan, of Poppy Fields Cafe, Athlone, with an electricity bill for just under ten thousand euro for two months. Photograph: Dara Mac Dónaill / The Irish Times Photograph: Dara Mac Donaill / The Irish Times

As the Irish Times reports, “The cost of electricity to the Poppyfields cafe for 73 days from early June until the end of August came in at €9,024.70 an increase of 250 per cent in just 12 months. There doesn’t include the €812.22 in VAT, which brought her total bill to €9,836.92.”

How in the name of God is this possible,” tweeted Dolan.



The energy savings plans now being contemplated, in fact, tell you all you need to know. They imply that by mid-winter, the European economy will be flat on its back.

Ulf Kempfer, vice-president of the German Association of Municipalities and mayor of Kiel gave an interview to Welt that sheds light on the  desperate measures now being readied to reduce electricity usage. Assuming that Nord Stream 1 continues to operate at one-fifth capacity, German energy consumption will have to be reduced by at least 20%; if the Russians cut off all gas, which they may well do, Germany will face a 40% shortfall.

Even the best case is a catastrophe that turning off street lights will not remedy. The biggest savings are to be had in drastically reducing indoor heating, and deep cutbacks on the use of warm water, refrigerators, washing machines and computers. Municipal services and office buildings will probably have to be closed, though some facilities, like public libraries, may be kept open as a refuge for those unable to heat their homes.

Moreover, in the midst of soaring hitting and electric bills, consumers may face a double whammy of high electric bills plus blackouts too. That’s because millions of households in Germany and elsewhere on the continent have scrambled to purchase electric heaters and heat pumps in order to reduce their exposure to out-of-this-world nat gas bills.

As a consequence, there is now a one-year backlog for heat pumps, implying huge incremental demand on the electric power grid. And the grid was already groaning under existing demand, meaning that heat pump and electric heater-driven surges during the ultra cold days this winter could cause the grid to shutdown.

As prices for oil and gas have risen enormously, in fact, European consumers have been desperately seeking alternatives. In Poland, for instance, there are miles long-lines at the coal mines composed of household vehicles lined up for a ration of coal.

Likewise, in Germany and elsewhere those who can afford it have installed heat pumps, while those who can’t have been going to the hardware store and buying electric heaters hand-over-fist. But as one energy expert noted,

And all of that requires electricity, but the grid isn’t designed for it … “We’re not going to be able to do that. The power grid is going to collapse. The blackout will come for sure.”

As German blogger Eugyppius noted about a typical German town called Starnberg,

We’re looking at nothing less than the total failure of green energy policies. The Greens have spent years promoting electricity as the only environmentally responsible sustainable solution, shutting down our nuclear power plants, pouring untold billions into wind and solar which do not work, and burning cheap Russian gas as a fake “transitional” measure to hold the whole scam together. It’s no accident that former chancellor Angela Merkel, responsible for our disastrous decision to phase out nuclear power, fought so hard for Nord Stream 2. But now the Russian gas is gone, there’s not enough power and random plumbers in Starnberg are praying that new heat pumps are delayed long enough to spare their fragile electrical grid new shocks ahead of winter.

So the question recurs, as Europe prepares for its winter from hell, what was the point?

The fact is, the Sanctions War has been an abysmal failure in terms of punishing the Russian economy and Putin’s ability to preserver in Ukraine.

As it happens, Russia is pumping almost as much oil into the global market as it did before its invasion of Ukraine. The WSJ’s Joe Wallace and Anna Hirtenstein report Russia is also making more money than ever before from the sale of oil and refined products owing to the sharp upturn in prices.

Russia’s crude and product exports are down just 600,000 barrels a day since the start of the year from a pre-war level of 7.85 million barrels per day, but Russia has earned $20 billion in average monthly sales this year compared with a $14.6 billion monthly average in 2021.

Moreover, data from ship-tracking firm Vortexa show shipments were rising again in August. Experts including shipping officials say Russian energy sales have flourished by finding new buyers, new means of payment, new traders and new ways of financing exports.

As to the point of this insanity, we sincerely hope that European voters wake up this winter and cause every one of the lap dog governments in Europe to fall. There is no other way to stop Washington’s arrogant warmongers and neocons, who have now taken the global economy to the brink.

David Stockman was a two-term Congressman from Michigan. He was also the Director of the Office of Management and Budget under President Ronald Reagan. After leaving the White House, Stockman had a 20-year career on Wall Street. He’s the author of three books, The Triumph of Politics: Why the Reagan Revolution FailedThe Great Deformation: The Corruption of Capitalism in America and TRUMPED! A Nation on the Brink of Ruin… And How to Bring It Back. He also is founder of David Stockman’s Contra Corner and David Stockman’s Bubble Finance Trader.


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  1. Yeah blame Trump who’s been out of office for 2 years🤣 Why not blame Nixon for PedoJoe’s failings🤣 Joe’s the one in office and the one doling out billions to the Nazis in Ukraine. Not the End Time Whack Jobs you keep whining about. So GFR.

    • Last time I checked Soleimani was still dead and so was the JCPOA.
      I don’t know what you’re trying to say with your babbling, doesn’t sound too bright but if you’re able to get your head out read and learn something:
      “Trump’s Shadow Looms Over Fading Iran Nuclear Talks” and see what three hurdles are there compliments of your orange buffoon the Likud darling that make the 50 lijudniks in congress lick his cojones get up march to kill the deal since last week.

      The funny thing about you regressives is that for you only democrats in the WH do things that have long term consequences, but you always think or led to believe that republicans’s clock stop the moment their miserable existence at the helm is interrupted. Lol.

    • Newt, democrats in the WH do things that have consequences today and yesterday too!!! forget about long term 🙂

  2. Of course the Nutzie supporters are quick to quip, Russia should not have invaded Ukraine to begin with so they must be stopped at all cost. They either convieniently forget about the US/EU coup, the endless shelling of Donbass and the ever expanding of NATO/US to the Russian border. I remember many moons ago when Russia was in the process of putting nukes in Cuba, we had a fit, and rightly so. Had Kennedy not ignored his generals advice, the world would have been a different place. Would we accept Russian or Chinese military bases with all the hardware that goes with it ? I hardly thing so.

    • Russophobia is a creation of Brits. Like every other misery in the world which is their doing, they will blame Russia until all oligarchs move to London with their money, London the shitholistan of Western Europe.

      Brits would never have a Kennedy but they had a Churchill the most foul pos in recent history.

  3. jonas…do you actually know how to type…
    obviously your secretary reposted this for you…
    how on earth can you claim any credit for the above…
    Now “no offence intended” actually does write his own pieces…
    i am not fond of the guy cos he tends to waffle into cricket scores half way thro…
    Jonas i actually bought his book…and waded thro it… hard work ..believe me..
    But you ….cricket is the word… a blight on the food supply…camouflaged quietly by some means.
    Is this comment personal…ad homenon..or watever…
    yes…fckn right it is….
    Do ur own fckn homework…and stop leeching.

  4. The real “powers that be” knew this would happen from the onset. The same folks who gave us 9/11 and all the wars of this century are about to force NATO into a catastrophic war with Russia. Here we are in the USA, $30 trillion in debt, the dollar about to be thrown aside as the world’s reserve currency, and the USA woefully unprepared for a land war in Eurasia. The only thing we and Israel are good at is using dial-a-yield mini nukes, like what were used in Iran, Syria, and Lebanon. Russia will retaliate with unstoppable hypersonic missiles aimed at Washington and European capitals. 50 million US Christian Zionists have their Rapture suits pressed and ready to go.

  5. Instead of blaming the US, perhaps you should blame Russia for invading Ukraine in the first place. They already took back Crimea and got greedy. Putin needs to be stopped and what other way is there in dealing with him besides sanctions? Certainly not nuclear weapons.

    • You’ve been terribly misinformed, apparently believing the controlled/lying Jooish owned MSM. See Tommy’s excellent comment above for a truthful assessment.

  6. Is Ukraine ‘aid’ factored into Stockman’s figures.. overall Arms exports to the EU? Arguably the EU may have to go to a wider hot war somewhere to quell social unrest and rioting. I read the French Foreign legion is in Yemen now trying to secure gas and oil fields for themselves while the Yemenis try to expell Suadi Arabia.. Just as the US is at forward base ‘Conoco’ in Syria.. ‘We’re there for the oil and we’re gonna keep it’ -Trump.

  7. Sir Jonas, some German comedians are posting sometimes a movie-clip from the famous movie “Der Untergang”, means the collapse or doom. Bruno Ganz, (+ in 2019) plays the role of Adolf Hitler during the last weeks in the Führerbunker in 1945. There is a scene between a german officer and Dr. Goebbels. I think you will understand what Goebbels is telling to this officer.
    “I cannot feel any compassion, i repeat, i cannot feel any compassion. The German people elected it’s own fortune. For some people it might be a surprise. Do not give in to any illsuions. We did not enforced the German people. The German people mandated us. Now they will recieve a cutthroat.”

    This is in a way similar to the current situation. I have no compassion for my fellow countrymen. I did not elected these cowboyboot-lickers in Berlin.

  8. Europeans went into this with their eyes wide open. They quite openly stated that their goal was to destroy Russia however when the Russians demanded payment in Rubles for energy they were not only surprised but outraged.That is the sure sign of people who believe they are better than Russians and are entitled.Any other leader would have shut the tap off a long time ago. In regards to Geraldine Dolan surprised and can’t understand why her electric bill is so high,just look at the Ukraine flag that you are sporting.This is just the beginning of a very rough road.

  9. Of course their green energy BS failed it was never intended to succeed because they want to turn Europe in to a rural wasteland where they can happily hunt children in the forest.

    • Joe Backrub’s anti-inflation bill is based on the same pile of climate change rubbish. We fools in the USA will be doing our share of dumpster diving down the road unless we establish energy policy based on realty.

    • Joe Backrub’s cojones are being pulled by the orange buffoon’s army of retards wanting to see their rapture and stuff licking the cojones of Likud to get the JCPOA that Joe Backrub is working hard to re-sign, thrown out.
      What Iran will do for Joe Backrub in return if it gets signed, is “Iran Is Ready To Release Millions Of Barrels Of Oil Into The Market.”

      It’s all the oil that the orange buffoon was sanctioning with his buddy Joe Lieberman the likudnik darling of republicans sitting around the world in tankers.

      Joe Backrub couldn’t get anything going with that trash wahhabi kid last month because he’s waiting for his buddy the poussie grabber to return, lol.

    • Trump didn’t know his ass from a hole in the ground when dealing with adults. So, why is Biden not taking advantage of the situation? There is a link from Iran to Russia to the Ukranian debacle. Joe hasn’t really figured out how to play the few good cards he’s holding. So, that makes him no better than Trump. The Dems never see an opportunity for correcting our economic course that they don’t miss.

  10. European Politicians to the Public:
    – “We have Bad News and Good News. The Bad News is the Economic Depression will crush Society and the Quality of Life. The Good News is there will be a massive hike in Authoritarian Control.”

  11. Id like to see speculation on what these baby eaters are up to. They must know the disaster theyre bringing down. What their plan?

    • Their plan? Tikkun Olam (“Healing of the World”), of course, which means for them massive depopulation, bloodshed, starvation, totalitarian control, leading to the ushering in of their long awaited “Messiah,” the Antichrist.

    • They had planned for an all out Nuclear Holocaust with Hillary in the Whitehouse. That failed so their plan B was a slow kill bioweapon. Not covid the “Vaccine”. Now with Russia defending the Donbas they may go back to Plan A.

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