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Ask HN: Should I be panicking about jobs in Europe?

112 points by norwalkbear 4y ago

I contract with a lot of European game studios. I've noticed many contracts were terminated suddenly including my retainers for cost reasons. Is the energy crisis that bad ? Are multiple industries affected right now or is it just planning ?

PaulHoule 4y ago
It’s pretty bad, especially in the UK since they are facing the energy crisis and the consequences of brexit.
- bArray 4y ago
  The UK might fair off quite well being decoupled from the EU during this coming crisis.
dejung 4y ago
It's a general recession, potentially leading into a depression. Nobody knows how bad it will get! We haven't yet seen the effect in the US but if the economy tanks here it will triple the effect on Europe with all its current problems.
- zx85wes 4y ago
  It's not going to be anywhere near as bad in the US because the US&Canada have plenty energy reserves. The situation in Europe is catastrophic. I expect there will be a major brain drain there the coming decade.
  - elzbardico 4y ago
    Plus the US probably will benefit from industries moving production from Europe to the US due to the cost of energy, not to mention the boom for American Oil and Gas replacing soviet sources.
jethronethro 4y ago
Panicking? No. But you should be seriously considering a Plan B and even a Plan C and a Plan D. Regardless, panicking won't change the situation. Taking them time to step back, look at your other options, and proceed calmly (though with a sense of urgency) is a better way to go.
- readonthegoapp 4y ago
  I didn't think the OP meant to literally panic. But maybe they did?
  - jethronethro 4y ago
    Or maybe just used the wrong word (panic instead of worry)? Regardless, what I posted still applies ...
dimensionc132 4y ago
yes prepare for the AI/robot apocalypse
readonthegoapp 4y ago
US companies are cutting, too, and we don't have the energy problems y'all have -- so I'm actually surprised Europe is not cutting more already. Yes, panic.
lmarcos 4y ago
Maybe just for contractors? Or maybe is it just the game industry? I switched jobs recently and had few good offers I left behind.
mindcrash 4y ago
Yes, it's starting to get bad. As a example a huge producer of automotive parts in Germany went bankrupt today. 4000+ people lost their jobs instantly. Nord Stream 1 has been shut down indefinitely and Germany requires it to keep their economy, heat and power supply going so lots more companies will follow. My family is going to stock up on firewood for our fireplace soon, so at least the house will not be cold come november-december when the Netherlands will run out of their gas supply in just about 2 weeks time tops.
- weinzierl 4y ago
  > As a example a huge producer of automotive parts in Germany went bankrupt today. 4000+ people lost their jobs instantly. Could not find any news about that. Which company do you mean?
  - martin_a 4y ago
    It's Dr. Schneider [1]. Never heard about them until now. [1] https://www.focus.de/finanzen/news/kronach-kronach-neuses-automobilzulieferer-dr-schneider-ist-insolvent_id_142492202.html https://www.focus.de/finanzen/news/kronach-kronach-neuses-au...
    - fxtentacle 4y ago
      But a) they are not bankrupt yet, they merely filed for government protection while they reorganize and b) it's only 2000 jobs
      - martin_a 4y ago
        Yes, probably just shrinking themselves to a more healthy state. Good "chance" to do so right now.
      - jonas21 4y ago
        > they merely filed for government protection while they reorganize That's what Chapter 11 bankruptcy is in the US - I assume Germany has an equivalent.
NicoJuicy 4y ago
Didn't tech got a major boost in COVID? Since the rates were hiked, they are also the biggest victims. I doubt this has much to do with the energy and more with the recession.
cookiengineer 4y ago
Most companies that relied on "cheap gas supplies" for heat generation are affected. Every manufacturing process that needs a high temperature oven for melting metal, for example, is highly affected by the gas supply. Due to gazprom basically being used as an economic weapon of Russia right now, that's not gonna change soon. The CDU sold us out to Russia, and it's not gonna change immediately. What we can do now is plan accordingly, and try to move to solar power as soon as possible. And by that I mean, yesterday. Bills exploded for private households, social media shows regularly pictures of ridiculous bills like 1600EUR+ for a month of heat for a simple family household. That's where it's at right now. Lots of people laugh or mock at the plus of 18EUR/month for Kindergeld that you can now get, because it's basically worthless in comparison. Prepare yourselves, this is going to be a war of cyber and energy. In my personal opinion it's inevitable, because Putin and his propaganda of the supposed "growing Nazism in Central Europe" has been going on for decades after the revolution attempt of the opposition. It's only a matter of time until Putin wants a strategically easier-to-defend Moscow, because the mountains in Poland and Finland sure look juicy to him. Always keep in mind: Whoever controls the oil and gas supply, controls the planet economically. The reason for the invasion of the North-East Ukraine was the oil fields, and the independence of oil supply for Europe was too high a risk for Putin's strategical control over the European Union.
- thro388 4y ago
  Maybe it is just Germans own stupidity. 3 nuclear power plants are going to be shutdown this January!
  - martin_a 4y ago
    That you created a throwaway account to repeat this nonsense speaks for itself.
    - iso1631 4y ago
      It's a couple of days late, but it wasn't until Sep 5th that they announced 2 of the 3 planned for closure on Dec 31st would be run for an extra 3 months. Still closing Emsland though, at least according to wikipedia https://www.zeit.de/wirtschaft/2022-09/zwei-atomkraftwerke-sollen-bis-april-2023-als-notreserve-bereitstehen https://www.zeit.de/wirtschaft/2022-09/zwei-atomkraftwerke-s...
JacKTrocinskI 4y ago
Are you in a low cost or high cost location? I would expect job cuts in high cost locations to come first.
- themitigating 4y ago
  "When recessions hit, firms lay off young and low-income workers first" Why make a guess when data already exists? https://equitablegrowth.org/the-most-exposed-workers-in-the-coronavirus-recession-are-also-key-consumers-making-sure-they-get-help-is-key-to-fighting-the-recession/ https://equitablegrowth.org/the-most-exposed-workers-in-the-...
nathanaldensr 4y ago
You ain't seen nothin' yet.
NKosmatos 4y ago
We have a very difficult winter ahead of us, especially here in Europe. Inflation is on the rise, energy prices are skyrocketing, wages are almost stationary and people are worried about the future. Im afraid that the recession/depression is coming…
- shubb 4y ago
  However, when it comes to contracts with european companies, it has more to do with fundraising. Energy and even margins are not hitting game studios and SaS products, but it is harder to close funding rounds. Why? Because asset prices in europe are down hard, and the exiting holders are reluctant to accept dilution by taking adequate funding now. The new investors would get a better price than them and erode their share of the company excessively, so they'd rather push management to raise less, cut costs, and try to limp through to better times. The other side of this is that venture firms / PE had an amazing 2021, so now they have loads of cash and not many opportunities. They can hold off for a while but the money needs to be committed before this dip is realistically over.
  - rgavuliak 4y ago
    > exiting holders are reluctant to accept dilution by taking adequate funding now. The new investors would get a better price than them and erode their share of the company excessively, so they'd rather push management to raise less, cut costs, and try to limp through to better times. This is the case for my employer
spraveenitpro 4y ago
yreg 4y ago
Mildly related question: European tech workers, what are you doing with your (monthly) savings? Hoarding euros? Converting to USD? $SPY? Gold? The same as always?
- martin_a 4y ago
  > The same as always? This. Yes, there's about 8% inflation in Germany but for people with higher incomes, it's not that bad (yet). My ETFs/stock portfolio has even gone up after a ditch when the war started, no real need to worry.
- hankchinaski 4y ago
  Long SPY and as a consequence USD.
- IMTDb 4y ago
  Diversified stocks and bonds, same as always. When it goes up, you get return on what you have already invested so far. When it goes down, you are buying at a discount. I am not trying to time the market, but create some capital for my retirement in 30 years, so whatever happens in the next 5/10 years is mostly less irrelevant. There have always been crisis, and there will be others.
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  - newaccount2021 4y ago
  - rurban 4y ago
    I"m still waiting to bit to buy at the best discount. Middle of winter seems to be the best time to invest. Stocks, bonds, gold, new car. Maybe buying a house, as long it is going down.
- user_named 4y ago
  All in China equities
tootie 4y ago
Nah. Some sectors are going through turmoil and churn, but employment is still very strong.
- yakak 4y ago
  Yeah, though I think tech is going to be more resilient to pressures toward recession and wage stagnation to the extent that it relates to cost cutting (or the perception of cost cutting) via automation, etc. I could see the game industry being a major loser in that turmoil as it both loses income in recessions and has to compete with rising wages in disruptive IT.
theshrike79 4y ago
That's the point of having contractors. EU doesn't have at-will employment and firing people is time-consuming and expensive. You can drop contractors on a whim. And it seems that some studios are doing that. At least mobile game studios are doing just fine, their main customers (whales) are in the US anyway.
fxtentacle 4y ago
game studios (== recreational non-essential spending) are most likely affected first. Prepare for increased job competition and stagnating wages in general. But panick? not unless you live in the UK. I'd expect mainland EU to continue almost as usual, with maybe a few high-energy factories shutting down. But since most of the jobs are service sector anyway, I wouldn't worry too much. I heard the news that in Germany a car part supplier started bankruptcy proceedings. But that's only 2000 jobs out of 84 million people. And all those coal and steel factories were only very few jobs, too.
- bb123 4y ago
  Why panic if you’re in the UK? They’re less exposed to Russian gas than continental Europe.
  - Barrin92 4y ago
    they have virtually no storage capacity and are highly reliant on gas for heating and electricity generation, more so than the continent. Gas prices are global so it doesn't matter whether your gas is Russian or not. The UK government is already preparing to spend almost 200 billion on stabilizing prices. (that's more than the NHS and military combined).
    - vba616 4y ago
      >The UK government is already preparing to spend almost 200 billion on stabilizing prices I notice public figures saying (paraphrasing) "why shouldn't the current bout of inflation be like the 70s". And I think "because they were trying to maintain the gold standard for way too long and that's what got it going?" Spending vast amounts on "stabilizing energy prices" seems like essentially the same sort of mistake. I wonder why other countries falter in emulating the Federal Reserve, which seems to have learned something from history despite all its critics.
      - bb123 4y ago
        I think the idea is to use that money to stop higher energy prices driving inflation
fffrantz 4y ago
It's not only the energy crisis, it's the whole economic downturn that's hitting every sector that we should be worrying about. Energy is just a mean to an end, and it affects most European industries, making everything more expensive. We should all be prepared for a rough 12-18 months, as we've only seen the tip of the iceberg so far.
luis02lopez 4y ago
I work for a EU company from South America. I have vast experience working for USA and I can tell you that I have old colleagues from USA (living in USA) being laid off. There are also lay offs in EU, and the economy in the country I live is a bit under pressure. This is global. Still, there is a lot of jobs, most of the people being laid off already have a job. I think we all are going to recover from this but RU.
kome 4y ago
perhaps it's time to stop follow idiotic American war policies, and look as our interest as Europeans. just saying...
- satyrnein 4y ago
  What does this mean? Lift sanctions on Russia?
  - zx85wes 4y ago
    The gas related sanctions hurt Europe more than Russia. With an ever more powerful China, I don't think that's good for the US.
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- zx85wes 4y ago
  The most idiotic policies come from the EU. Janet Yellen had to intervene to stop them from implementing a total boycott on Russian energy in April. https://www.europarl.europa.eu/news/en/press-room/20220401IPR26524/meps-demand-full-embargo-on-russian-imports-of-oil-coal-nuclear-fuel-and-gas https://www.europarl.europa.eu/news/en/press-room/20220401IP...
yabatopia 4y ago
The energy crisis is pretty bad right now, with no end in sight, for now. But that's only a short term problem. It's just a minor bump. The demographic trend is what it is: baby boomers are retiring en masse and the influx of a new qualified employees is simply too low. Unemployment remains low. Jobs will be fine.
rr888 4y ago
Its time to go back to the office and be nice to the boss again. :)
mkl95 4y ago
I joined a VC-backed company a few months ago. Back then there was an air of confidence in the team. Now I'm getting mixed signals from management and they seem low key insecure. Turnover is slowly but noticeably increasing. I will apply Occam's razor here - investors don't want to gamble their money on crappy software. SaaS vendors were playing on easy mode before 2022, but it's over for obvious reasons. If you want to succeed, it's time to increase that engineering budget and let your sales people sell something that actually works.
deleted 4y ago
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bArray 4y ago
Yes, things are about to get really bad. The problem is that it's not limited to just one crisis: 1. Inflation - It turns out that you can't just keep printing money for about a year to pay for people not to work, and expect the currency to not suffer from inflation. It's a miracle it is not further inflated (although I might be speaking too soon). As inflation increases, your monthly pay becomes worth less whilst everything around you becomes more expensive. 2. Global recession - This is coming. The euro is now below the dollar and continues to fall. The dollar will crash soon too. Shorts are increasing by the day (open any stock graph). 3. Energy crisis - Companies are already looking to migrate away from the EU during winter. Those that stay will have to battle with high-priced, unreliable (read: rolling blackouts) energy supply. I would expect work-from-home becomes a requirement. I read that the EU are looking to subsidize energy and cap non-natural gas to 200 euros a MW, but this is doomed to fail. 4. Increased social issues - Lower quality of living, less funding for social programs, less funding for police, etc, will lead to higher crime. Schools have already said they will not be able to heat schools and therefore would have to send students home. Suddenly you have millions of bored teenagers whilst their parents are at work. 5. Food crisis - This one is yet to hit. There is a bill to pay for the energy crisis, droughts, fertilizer shortages, decreased global food supply, increased shipping costs and more. I suggest everybody start slowly (not panic) buying in some excess basics like rice and flour. Worst case, it's a bad prediction and you slowly use it over the next year. Worst case, it could serve as the base of your meals during hard times. 6. Strikes - People will want to strike, but this will likely only make things worse. We will see strikes from more and more critical roles, which will only further stall the economy and make recovery further away. If you don't believe in the power of a few people striking, jog your memory to the Canadian trucker strike. Believe it or not, it could be far worse. 7. Financial commitments - Europe won't be the first to fall and will likely be obligated to help out other Countries. For example, if the EU doesn't help with the Pakistani floods, these are potentially future asylum seekers, which will exasperate the situation. You also have financial commitments to military defense and the Ukraine-Russia war. As times get tougher, things will likely get worse. 8. War - The West (US + EU + friends) are currently heavily involved in international peace commitments. It is highly likely that Countries biding time will seize on the weakness of the West and further their own agenda. I expect to see China increase their timeline to invade Taiwan (this is a matter of pride and future financial + neighbor security). I would also suggest to watch Africa which is largely debt trapped. There are quite a few other places. There are also quite a few other factors, but this is already too long. I highly suggest to take actions now to ensure basic survival.
endorphine 4y ago
Can someone explain what's causing the energy crisis?
- jacknews 4y ago
  the acute cause is one man, 'putin'
- fulafel 4y ago
  Dragging our feet in saving ourselves from climate catastrophe, while ignoring other risks from the legacy fuels. It's popular to blame the politicians about this but I mostly blame the citizens most of whom voted for this while knowing better.
- benhurmarcel 4y ago
  Russia cuts off the natural gas supply in response to the sanctions for invading Ukraine.
elzbardico 4y ago
A severe depression (not simply a recession) in Europe is now basically unavoidable. Things are going to get really bad before they get better.
- dmarchand90 4y ago
  Why? I don't think one can ever have any certainty in economics...
  - elzbardico 4y ago
    There is an ongoing severe contraction of basic industry, that relies on gas not only as a cheap energy source, but also in the case of fertilizers and other chemicals as an input material. European industrial competitivity requires cheap gas and oil at the moment, salaries are high, the job market is heavily regulated, and there's no way to compete with China and the rest of the world without this. There's no way to come up with the required volumes of LNG to substitute russian gas, there are not enough terminals neither the number of ships for that. And even if there was, LNG shipped from the US or the gulf paid in spot prices is shockingly more expensive than gas transported through pipelines and paid via long term contracts. Due to the situation in Syria, it will take a lot of time to create alternative pipelines coming from the midwest, not to mention the time and capital. And we are not even talking about Siberian Oil (also supplied through pipelines via long-term contracts). Not only transport costs are higher, but changing the oil blend has its own problems, requiring extensive retro-fits on refineries. Green? it takes some time, and also extensive retro-fits on most industries, and does not solve the issue of gas being a material input for a lot of essential chemicals. The supply problems are mind-boggling and difficult, solving them costs a lot of capital and time. The cascading side-effects throughout the whole supply chain can only be superficially understood, the fiscal effects due to the reduced tax income could not come in a worst time, unemployment and bankruptcies are going to play havoc in the derivatives marketing. Things are not simple, whoever says you otherwise is misleaded or misleading. A peaceful solution to conflict must be found, or instead, the NATO needs to be way more aggresive and submit the Russia state by sheer fire power.

sydd 4y ago

I would not be so worried. While the situation is not so rosy, Nordstream's closing will be compensated by using less energy generally (e.g. not heating up gov buildings, lots of people working from home etc.) and from dozens of other sources (importing more LNG, letting nuclear plants run more, firing up coal powered plants etc) Russians are very good as sowing discord and creating panic among the population, but if you look at the facts things are not so bleak. - If closing down Nordstream would really lead to the collapse of the German economy then the EU would have lifted the sanctions. While they can accept some hardships to beat Russia, they would not kill their economy to do so. - Just look at the gas futures price in the EU: https://www.theice.com/products/27996665/Dutch-TTF-Gas-Futures/data?marketId=5429405&span=1 https://www.theice.com/products/27996665/Dutch-TTF-Gas-Futur... Since the full closure of Nordstream gas prices have actually gone down showing that the gas market has already priced the closure, and as time will pass it will go down even more (since people will see that we have enough gas & Putin's threats are taken less and less seriously mostly because he has run out of things to threaten with) So dont panic and trust Western leaders a bit more.

neural_thing 4y ago
Another interpretation is that the futures are pricing in price controls.
triyambakam 4y ago
jemmyw 4y ago
Thanks, that's a much calmer balanced view. https://www.youtube.com/watch?v=ce5TR-qWCk4&t=3574s https://www.youtube.com/watch?v=ce5TR-qWCk4&t=3574s this vid has a great and lengthy analysis on the economic situation in Europe. Basically, Europe and Germany will be fine because they can afford the burden for awhile and may even still grow economically. Russia has stabilised their economy for the moment with drastic intervention, but they are time limited.
- gremlinsinc 4y ago
  Russia is as toxic as you can possibly get, they have a 'brain drought' of talent that has exited the country either in protest or in fear or retaliation for sympathizing with Ukraine. Russia's losing the war because they always value loyalty over skill, strategy -- those with skill usually end up appearing to be a threat so end up dead, or get canned if they're lucky - militarily speaking. In the business/tech centers, there practically IS no business/tech centers, with all this moving out of Russia into the western nations and baltic states -- there will be huge growth after the war is over in most EU countries that aren't Russia or Belarus. Short term, I think it will be a struggle, long term I think weaker Russia is good for the whole world, I'm hoping china begins to decline too - esp with the real estate crash they have looming, if they lose their ass on foreign real estate our housing prices might go to some semblance of normalcy. Here in Utah, the average home price went from 200k 10 years ago to 600k now, only way I'll ever own a home is if I buy land and build a $10k earthbag home lol.
  - jemmyw 4y ago
    If the war is over next year (I'm not optimistic, but fingers crossed) and Ukraine prevails, which seems to be a certainty, then the US and EU will plough money into Ukraine's recovery. They'll want an institutionally stronger country there regardless of the diplomatic solutions found to the war/borders etc. That will be a shot in the arm to the eastern EU economy and probably quite positive to the world as a whole. Yeah I agree that the future looks bleak for Russia, actually regardless of how well they fight. They lost, long term, when they didn't take Ukraine in 3 days. They showed a weak hand and I suspect even their ally China will treat them as a second partner and with some contempt. Perhaps the best outcome would be the Russian government falling again and this time western powers actually helping out, but I doubt they'll collapse in a way that lets that happen, or that society there will accept help, or that western countries would be interested in helping anyway. China will decline, they're not in a great place demographically. And this is my personal opinion: China had the opportunity to become great, with just a little more freedom they could have leveraged their hi-tech manufacturing base and encouraged innovation. But instead the leadership got scared that they were losing power and sent thing in the wrong direction. It's not that they aren't innovative, it's just that has been tempered enough that they won't take the lead and all the other issues - demographic, geographic etc will take them downhill. Which is a shame because instead of a (slightly) freer world we get nationalism and unpredictability; who knows now what they'll do if they can't deliver on better living standards and an ever improving economy? Invading Taiwan would be stupid from many perspectives, but as a way to drum up and hold support of the population maybe it works?
    - v4dok 4y ago
      Its interesting because I would argue for the exact opposite of everything you say (almost). Which makes for a nice discussion. I don't think the war will be over until US and EU decide to stop sending weapons to UKR. Now, in terms of UKR prevailing, no matter how you spin it, they lost 20% of their country and the majority of their fighting ability if not for external support. Doesn't look like prevailing to me. Basically any chance they had to be "independent" state are gone, either they are occupied or in heavy debt/reliance to the EU/US. Yes future looks bleak for Russia indeed, but the same is the outlook for EU. A broken relationship with Russia never worked with Europe historically, and for good reasons. Also, Russia cannot be "helped" from the "west", its not "yet another" country. Whoever I know that has been there, can confirm that its a special place with dynamics that are not entirely understandable by western values. I don't see China declining, the opposite actually. Yes COVID hit them (which for me screams "Cui bono" to the whole covid thing, but thats off topic) and they are doing bad demographically, but their struggles are not in vacuum. Europe is getting hammered and its even worse demographically, US is in a "esoteric mode" dealing with problems from within.
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- blub 4y ago
  What does it mean to "afford" the burden and be "fine"? Yes, a collapse of the EU economy and the EUR is unlikely, but other things are already happening: massive heating and electricity bills for businesses and individuals. Companies going bankrupt. Manufacturers of essential materials shutting down. And so on and so forth. How does this reconcile with warnings by the Belgian government that we can expect between 5 and 10 hard years? Or the comment by the French president, that the "end of abundance" has arrived - which perhaps wouldn't be so bad, if it really were an era of abundance for large parts of EU societies.
  - sydd 4y ago
    > What does it mean to "afford" the burden and be "fine"? That the EU has 2 choices in the long term: 1. bow to Russia's demands and lift the sanctions. Gas will be turned on and its price will fall, but now Russia knows that they have a weapon that they can and will use against the EU when they see it fit. Also it would result in a huge uproar, most EU states are very pro-sanctions despite the hardships. 2. Do not lift sanctions. In this case the gas price will stay high, but will certainly fall long term. Also Russia will have no leverage against the EU. Also the situation is not so dire as it seems: Russia supplied ~15% of the energy to EU, so if the EU can lower its energy demand by a bit and get a bit of energy from extra sources they are set. People did the math and its possible, likely in 2 years there will be a minimal effect of no gas flowing from Russia. As for the "hard years", its not just the energy crisis caused by Russia turning off the gas valve: After the constant boom of the 2010s its time for the bubble to burst. Global warming effects are starting to hit hard, the supply chain issues starting with COVID and getting worse with the war made governments realize that you cannot outsource everything; moving back production to the West will casue lots of price hikes. Also boomers are now starting to retire causing the most experienced part of the workforce to shrink drastically and being replaced by pensioners who just cost states money. So no matter what we do with Russia the next 15 years will be hard -- I'd say that the belgian government was optimistic with the 5-10 years estimate.
mattnewport 4y ago
> and trust Western leaders a bit more. What have Western leaders done in the last 20+ years to earn such trust?
- k__ 4y ago
  Being sustainably successful for hundreds of years? I mean, China is the only successful country that isn't western, not even in spirit (like India, Japan, or Korea) and their run seems coming to an end lately, with all their debtors defaulting.
  - mind_heist 4y ago
    I m not sure if this is fully accurate though, especially about Japan and South Korea part. Both of them have demonstrated solid economic prowess in the last few decades & if you ignore a few decades of colonial interlude and look back further - they still have had sound economies in previous centuries. I think Singapore , Taiwan and even may be UAE are missing from this list ( depending on how much further back in history you are looking at).
    - woobar 4y ago
      I think GP meant that unlike China these countries are "part of the West" now, not that they are unsuccessful.
      - k__ 4y ago
        Yes. They are successful and follow the "western spirit" more than the rest of Asian countries.
  - benwad 4y ago
    Causing two global conflicts isn't what I'd call 'sustainably successful'. Since those, I'd agree with you, but definitely not hundreds of years.
    - 4y ago
k__ 4y ago
This. If Germany loves one thing, it's being richer than the rest of Europe. They just throwing their weight around.
yread 4y ago
Another reason not to panic is that the Dutch have a massive gas field and choose to use it only 10% (2.7B m3/year out of 25B m3/year, about 60% of their consumption). Surely, if the situation was dire they would max out their wells first, (they say it would produce small earthquakes and 15000 houses would be in danger but that's a small price to pay)
- mind_heist 4y ago
  and looks like coal seems to be the first choice for now ? imported from australia and south africa ? https://www.reuters.com/markets/commodities/europe-imports-more-south-african-coal-russian-ban-looms-2022-06-15/ https://www.reuters.com/markets/commodities/europe-imports-m... https://www.argusmedia.com/en/news/2349110-australia-leads-netherlands-coal-imports https://www.argusmedia.com/en/news/2349110-australia-leads-n...
  - sydd 4y ago
    Australia is happily selling any amount of coal to the EU because they are in a trade war with the Chinese who refuse to buy their coal.
origin_path 4y ago
"So dont panic and trust Western leaders a bit more." It's the western leaders who are keeping both Nord Stream 2 and 1 closed: NS2 because Germany won't license it, and NS1 by sanctioning Russia so they can't work with the companies that repair the broken components. In fact there are at least 5 gas pipelines into various parts of Europe which are all closed by the west or western actions: https://swprs.org/is-russia-limiting-gas-flows-to-europe/ https://swprs.org/is-russia-limiting-gas-flows-to-europe/
- hackeraccount 4y ago
  This is a political not a technical issue. Russia and the EU are figuring out what their relationship is with regard to energy supplies and if we will say The Ukraine or Ukraine in 10 years.
  - origin_path 4y ago
    It's both - there are compressors sitting in the UK that are blocked from being returned to NS1 because of British sanctions. The pipeline needs compressors (technical) but can't get them because they're repaired in foreign countries (political). The stupid thing is, somehow these facts seem to have got lost somewhere along the line and the European countries are convinced this is 4D chess by Russia instead of the exact outcome sanctions were intended to create.
- sydd 4y ago
  > NS1 by sanctioning Russia so they can't work with the companies that repair the broken components. Not true. While Canada who repaired the turbine first refused to give it back to Russia now they are willing because of German pressure. Siemens (the operator of the turbines) has stated multiple times that there is no technical issue in running NS1. Russia is not supplying gas trough NS1 because of political reasons: - Russia's main goal is to make the EU stop supporting Ukraine, thus they can make a favorable peace agreement. Their main goal is to get the EU states oppose the war. - They are doing this by trying to sow panic and chaos in the EU by turning NS1 lower and lower (now its off) and other things like releasing ridiculous videos like https://www.youtube.com/watch?v=kcbcBrL4ju4 https://www.youtube.com/watch?v=kcbcBrL4ju4 - This panic also results in high gas prices which is harmful to EU's economy and good for Russia's pockets. The west should not bow to Putin's will, if it would lift the sanctions Putin would use gas as a weapon against the EU whenever he wants; the only good choice is to get rid of any Russian dependency. Trust the western leaders, they did the math. The EU will have enough energy for the winter. Also USA is bringing out the big economical guns too, they started to lower the price of oil which will result in crushing Russia's #1 income source (they can produce oil for around $50) and this will also bring down energy prices. This and the next winter will be still hard for the EU, but after that things will stabilize. But seriously what did you expect, how could a Russia, a country with a total GDP around Italy beat the EU, Japan, USA, Australia, South Korea in an economic war?
blub 4y ago
There are many unpleasant steps to go until reaching the collapse of the German economy and while the EU has certainly overplayed its hand, giving up too early is (geo)political suicide. Outcomes that are likely this winter are blackouts, bankruptcies for businesses and for individuals financial ruin and losing one's savings. The question is to what extent those will happen and which percentage of the population will be affected.

epolanski 4y ago

> to gazprom basically being used as an economic weapon of Russia So after we funded Ukraine's war, sanctioned Russia into oblivion, froze hundreds of billions $ of their money, forced our companies to leave their market, and even seized their belongings it's them weaponizing assets? I'm all for the sanctions and support, but making Russia the bad guy for our economic crisis because they are retaliating sanctions is really biased. It's not a weapon, it's a trade and they leave money on the table everyday. Lots of money.

themitigating 4y ago
"Both sides both sides" Russia is the bad guy for both the war and their reaction to the sanctions. Your comment is like saying "don't get mad at a criminal for shooting at the police chasing him".
- paganel 4y ago
  > at the police chasing him" Just so that we're clear, calling the West as "the police" as you do with your analogy just reinforces Russia's claim that we now live in a unipolar world, of which the US is the policeman (hence Russia's desire to split it all into a multi-polar world, no police chasing bad guys without international due-process there).
  - scrollaway 4y ago
    - gdy 4y ago
      - scrollaway 4y ago
        gdy 4y ago
        scrollaway 4y ago
        gdy 4y ago
        deleted 4y ago
        [deleted]
      - dang 4y ago
        Please don't take HN threads further into hellish flamewar. It's not what this site is for, and it destroys what it is for, and we end up having to ban accounts that do it. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
        gdy 4y ago
        Sorry
    - epolanski 4y ago
      - scrollaway 4y ago
        None of these conflicts justify the Russian invasion of Ukraine. Nothing in the world justifies a Russian invasion of Ukraine, because this isn't the 18th fucking century. Stop trying to justify the Russian invasion of Ukraine.
        azth 4y ago
        Where’s he justifying it? He’s simply pointing out the double standards when the West policies the world how they can get away with whatever atrocities they want. Plus, you furthered his point by calling the western atrocious as “conflicts”.
      - dang 4y ago
        Please don't take HN threads further into hellish flamewar. It's not what this site is for, and it destroys what it is for, and we end up having to ban accounts that do it. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
    - dang 4y ago
      Please don't take HN threads further into hellish flamewar. It's not what this site is for, and it destroys what it is for, and we end up having to ban accounts that do it. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
  - themitigating 4y ago
    My analogy was good vs evil not policing. Defending the invasion of another country is also not policing
- epolanski 4y ago
  [flagged]
  - zx85wes 4y ago
    "we" didn't want them to do business with us. See "MEPs demand full embargo on Russian imports of oil, coal, nuclear fuel and gas" https://www.europarl.europa.eu/news/en/press-room/20220401IPR26524/meps-demand-full-embargo-on-russian-imports-of-oil-coal-nuclear-fuel-and-gas https://www.europarl.europa.eu/news/en/press-room/20220401IP... The US had to intervene to stop this.
- bilvar 4y ago
  Where were EUs sanctions when the “police” was massacring people all over the Middle East multiple times?
  - MrRiddle 4y ago
    That doesn’t count, that was a mistake /s
  - themitigating 4y ago
    Whataboutism, unrelated to this situation
- gdy 4y ago
topher6345 4y ago
Russian could end the sanctions by choosing to withdraw their invasion. Withdrawing is the win/win for everyone.
- gdy 4y ago
  - generalpf 4y ago
    - gdy 4y ago
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    - gdy 4y ago
- zx85wes 4y ago
  Tell that to the Crimeans. https://www.washingtonpost.com/politics/2020/03/18/six-years-20-billion-russian-investment-later-crimeans-are-happy-with-russian-annexation/ https://www.washingtonpost.com/politics/2020/03/18/six-years...
bilvar 4y ago
This. It’s quite saddening to realise Western people are as brainwashed by govts and media as much as the Russians are.
nl 4y ago
This is the first time I've ever heard a Russia apologist even try to call it "Ukraine's war". Almost like it's a surprise Ukraine fought back when Russia invaded. Even Putin was honest enough to call it an invasion and limited his lies to attempts to justify it. Yes retaliation for sanctions can be expected. But Russia is still the bad actor here.
- epolanski 4y ago
  Call a Russia apologist someone else. As stated, I support both supporting Ukraine and the sanctions. That doesn't make our policy makers any less ridiculous and short sighted in their expectations.
  - nl 4y ago
    In retrospect I suspect you might be a non-native English speaker? ("Call a Russia apologist someone else" would normally be written "Call someone else a Russian apologist"). In English "Ukraine's war" give the ownership of the war to Ukraine, making them responsible for it. If this isn't your intent then good, and I apologize for calling you a Russian apologist.
Tade0 4y ago
This isn't the first time they weaponized their assets - just the first time against the west. Countries neighbouring Russia dealt with similar issues multiple times already.

odiroot 4y ago

Probably makes sense to pay off your mortgage if you have one.

bgorman 4y ago
Why would you do this in a time of high inflation?
- h4waii 4y ago
  Ideally, so you have a place to live, regardless of the outcomes and influences of inflation et al. Sure, buying real estate is seen as an investment, but it's also a spot to live and to keep all stuff to help or hedge your enjoyment of life. Some people just want to live, debt free, and be left alone.
  - vba616 4y ago
    I am concerned with having a place to live, as distinct from preserving my current home. If I ever have to leave my doomed home with only what I can carry, I'd rather owe as much as possible at that point in time. I think that debt owed to human beings is strictly better than the same amount of equity just vaporized with no possible recourse.
  - tjansen 4y ago
    During an inflation your salary is likely going up, and so are all other assets that you own or buy. Let's say you owe 100000 EUR for a 200000 EUR house, pay 2% interest, inflation rate of 10%. Your net worth is 100000 EUR in the first year. If you repay 8000 EUR, the next year you owe 92000+2%*92000=93840 EUR and your net worth is 220000-93840= 126160 EUR. If you repay 4000 EUR and invest 4000 EUR in gold, next year you owe 100000-4000+2%*96000=97920 EUR, your gold is worth 4400 EUR after inflation and your net worth 220000-97920+4400=126480 EUR. Plus you have improved liquidity. If the inflation rate is higher than the interest of your loan, it's often better to invest in inflation-proof assets.
daydream 4y ago
In times of uncertainty and volatility and especially inflation, if you have enough money to pay off your mortgage, you might not want to actually pay it off. Assuming you have a fixed rate mortgage at a low interest rate, not only will the value of your debt be inflated away, but you retain optionality. Meaning you can use that big chunk of money as a hedge against a job loss or other negative event, you can use it to invest as your see opportunities, etc. Of course the flip side of this argument is if you do pay off the mortgage, you get a guaranteed rate of return equal to your mortgage interest rate.
- oceanplexian 4y ago
  30 year fixed rate mortgages is specifically an American thing. Not sure this is the case in all European countries but I’ve heard that they typically have much shorter terms and/or variable rates.
  - sofixa 4y ago
    At least in France 15-25 year fixed rate housing loans (technically it's not a mortgage because you don't guarantee the loan with the housing directly, there's an intermediary insurance to guarantee that will fight you over the housing if you stop paying) is pretty much the norm.
  - v-erne 4y ago
    Poland is great example of this - fixed rate mortgages are almost nonexistent here. When inflation hit and the Monetary Policy Council rose intrests rates by 6,5 percent it doubled monthly installments of many people. And rates are still off by 10 points from real inflation. If they would rose those rates to the real values it would probably bankrupt hundred thoused people here.
jbjbjbjb 4y ago
If paying your energy bill or losing your job is going to be an issue you don’t want to put a huge sum of cash into an illiquid asset like a house. You want that cash to remain available.
edem 4y ago
Unless you have a fixed mortgage. In that case the bank takes the hit for you.

brianmcc 4y ago

You'd think. But UK is less well governed: among other things Brexit has brought its own special brand of GDP inhibition. https://edition.cnn.com/2022/08/19/energy/energy-prices-uk-europe-explainer/index.html https://edition.cnn.com/2022/08/19/energy/energy-prices-uk-e... As wholesale costs ballooned last year, 31 smaller UK energy companies — who traditionally offered competitive prices — went bust, forcing millions of customers onto the books of bigger suppliers, and to pay higher bills. The way the British government designed the energy market made this more likely, Henning Gloystein, director of energy, climate and resources at Eurasia Group, told CNN Business.

veltas 4y ago
Brexit has got next to nothing to do with the current energy crisis in the UK: it's a worldwide problem, and even the CNN article you've cited claims it's not Brexit that's made it worse in the UK than elsewhere.
- brianmcc 4y ago
  True but it's a factor unique to the UK adding even further to the economic woes that energy costs bring, hence it belongs in responding to "why panic in the UK?". Covid lagging impacts plus Brexit plus energy prices is all pretty grim. And now Rees bloody Mogg is the Business and Energy Minister. Sheesh...
jbjbjbjb 4y ago
That report missed that the issue was because the cap was designed to prevent suppliers exploiting customers who don’t switch supplier regularly to get better deals. It ended up with smaller suppliers that act as brokers to lose money in the current market. It was not a catastrophic issue.
vba616 4y ago
Where I live in the US, the power company is National Grid, headquartered in London. I believe that customers can select a different energy supplier, while paying National Grid for connection and delivery. So it sounds like you are talking about a similar system. I'm not sure of the state of the market, and I've never tried changing my supplier, but I do notice the electricity supply rate has more than doubled year-over-year. My understanding is that most of the power here comes from Canadian hydro, so that seems to tell you something about the usual explanations for price changes.

type0 4y ago
> I don't see China declining You don't seem to follow recent economic developments then > Basically any chance they had to be "independent" state are gone Ukraine is more independent now than it ever was 2013 or 2021 and all is telling that it will be even more so after the war, so I'm not sure what you are smoking there
- v4dok 4y ago
  1. I meant declining in a more generic/long-term view 2. Independence is underpinned by a combination of military and economic power which adds up to enough power to take your own policy decisions. For now UKR has all the independence it wants to take any decision that is aligned with western goals. That (might) be aligned with their interests right now, giving the impression of independence, but it won't be always so. 3. I was trying to make conversation, your comment about my smoking probably tells more about you.
NicoJuicy 4y ago
The war will be over when Ukraine takes Crimea. Russia only cares about the gas that is found there, which can entirely replace Russia's deliveries. The future looks better for Europe/Ukraine than you'd expect over a 4 year term. Not so much for Russia. Putin made Russia a pariah state like North Korea
- blub 4y ago
  Nobody knows when the war will be over. Most of us didn't even know there would be a war, even while Russia was amassing troops at the border. While I'm not sure about Europe, Ukraine seems lost: they're at the mercy of the IMF and had to give up their economic independence. In the best case, they can emerge like Bulgaria, Romania, etc in a decade or more - moderate brain drain, industry bought off, moderate corruption. In the worst case, they'll suffer massive brain drain, all their industry will be bought out or lost, high levels of corruption and they'll be reduced to providing labour and raw materials for the EU. The war will likely strengthen the nationalist and extremist factions in the country and make it even more difficult for the government to reach a compromise. It's not clear if the fledging democracy will survive this war. Beforehand there were concerns that the president has too much power, now with political parties banned it's uncertain how a meaningful opposition would look like. On the military side, even ignoring that they've lost a large chunk of territory, they are still neighbouring Russia. And despite the optimist messaging, Russia has many ways to make Ukraine's life harder or even snuff it out. From targeting energy and industry, to chemical weapons and even nukes.
  - NicoJuicy 4y ago
    Ukraine isn't lost, even after the war multiple countries now are mentioning which cities they are going to help rebuild. Additionally, in 4 years time they will have insane profits from gas, where the pipelines have already been laid. Europe will be able to stop all payments to Russia and change it to Ukraine. In the future, they will probably do similar preparations like Finland did ( since Finland got invaded hard also in the past). Russia is already the pariah state. And while Europe is harboring fleeing Ukranians, we are tightening ties and exponentially tieing their future WITH Europe ( eg. The English language). Ps. The future of Ukraine tied to Russia would have been a joke, just check Chechnya and Syria. They are way better off if they are open to it. Just check GDP growth of Poland, that's what partnering with Europe means and can do.
jemmyw 4y ago
Whether they can push Russia out I don't know, that probably depends more on Russia than Ukraine. Russian people aren't exactly signing up in droves to push this invasion - a little probably, but stories coming out from the Russian soldiers now are on the side of "we didn't know what we were doing, we didn't want to be doing it." Ukraine, on the other hand, has had more recruits than they could handle, because people want to defend their country. Putin's view was that the people of Ukraine wouldn't stand up, didn't see themselves as a country, didn't like their own leadership, would revolt etc. and he was wrong. Ukraine is now making counter offensives. Whether those succeed or not, it's remarkably different from the predictions of many analysts that Ukraine would be taken over in days or weeks. I disagree with your line about independence. America funded the rebuilding of Europe and Japan after WWII. It is way more in the interests of us in the west to have independent states rather than vassal states. This is where Russia is failing - if they make Ukraine a vassal state and install a government the people there will forever agitate and cause trouble, it will always be a thorn in their side. They'd have to attempt Russification once again, and how well has that worked out? Small states are never independent completely, but internally independent and being rebuilt by western allies is surely a lot better than vassal state of Russia. Especially as the majority of Ukraine wanted to loosen ties with Russian and join the EU - thus why we're where we are. China has a worse demographic problem than Europe. Fastest ageing country. Yes Europe has some similar problems, but the worst place in Europe for that is Russia.
sxpnsxpn 4y ago