The ArcelorMittal, the world's second largest steel firm, is scheduled to close one of its two blast furnaces in Bremen, Germany at the end of September. The reasons cited were soaring energy prices, degrading competitiveness, weak market demand, high cost of carbon dioxide, and a planned German government corporate gas rationing in October, a first in the history of the European Union.

EU aluminum smelters are also starting to shut down. One of six industrial firms in Germany is forced to reduce production, says German chamber association DIHK in a survey of 3,500 firms. (2 September 2022, oilprice.com)

Steel is the catalyst for industrialization, and its decline has profound effects on inflation and on the national economy. Its domino effect in terms of production and employment is unimaginable.

Massive unemployment can trigger anarchy as in Sri Lanka and Pakistan. Without steel, industrialized nations like Germany invite recession both in the short and long terms. It is hard to revive plants that have been mothballed for so long. In many cases, it is perhaps irreversible.

In our ever-shrinking planet today, recession is contagious. It is an "export commodity." If Germany, the largest EU economy, goes into recession, the entire EU follows. An EU recession will easily infect the entire Western hemisphere, starting with the Middle East, then the US, Russia, and China. In the end, because we are hopelessly interconnected, under the domino principle, we achieve rapid global recession. A recession in the US or China, the two largest economies in the world, will be the coup de grâce.

The estimated $5.5 trillion total stimulus to business and aid to people's health following the pandemic triggered a global cash surplus. More money means less value, the essence of inflation. The US has poured $1 trillion into the bank accounts of its citizens. As of this writing, US inflation stands at 27 percent of gross domestic product; the UK, 18 percent; Australia and Canada, 20 percent; Japan, a staggering 53 percent; EU, 11 percent; and India, 3.5 percent. Japan encouraged citizens to purchase alcohol to help stave off inflation. (Source: WION-Gravitas)

The EU is partly to blame for its woes. The Russian invasion of Ukraine triggered the EU to "shoot from the hip," imposing deadly US-led sanctions, such as banning the purchase of Russian crude, which soared to $120 per barrel, not realizing it would backfire when they did not plan for energy alternatives until it was too late. When Russia shut down the Nord Stream 1 pipeline, it was the beginning of the end.