Pundits: Yuri Maltsev: Russia caused middle east uprisings.

[ironmanjakarta]

If I understand him correctly, Yuri Maltsev says the high food prices in the middle east was caused mostly by a drought in Russia, and not because of the fed devaluing the dollar:

http://www.youtube.com/watch?v=hv4NNsPaL44&feature=player_detailpage#t=1790s

 

[efiniti]

I'm not buying it. This would have to be such a massive drought that it caused Tunisia and other countries to revolt as well. Take a look at Egypt's inflation rate. Its been in the double digits for about two years. And its not just the price of wheat going up, vegetables and fruits are up too.

 

[ironmanjakarta]

I agree. I think it's the opposite. The price rise occurred mostly because of the fed and marginally because of the drought. Just shows even the experts on our side aren't right about everything and must not be blindly followed.

 

[hugolp]

Both are true, and it is incredible hard, or directly impossible, to say how much each part influenced, because we would need to know how people would have reacted if one of the two would not have happened.

 

[ironmanjakarta]

Now that I think of it, there's no way prices would have almost doubled in the middle east (as Yuri stated) because of the fed, right? The dollar hasn't devalued THAT much. It must be because of the drought.

 

[hugolp]

Now that I think of it, there's no way prices would have almost doubled in the middle east (as Yuri stated) because of the fed, right? The dollar hasn't devalued THAT much. It must be because of the drought.

No. I already said I think its a combination of both, but it could have been the Fed alone. The thing is that money does not "spread throught" goods and service evenly and always in the same way. It can concentrate in some areas. So you can have some assets going up because of monetary inflation (commodities) while other assets go down (houses) and have the dollar exchange rate do a third thing. Its not linear.