How the Home of America's Worst Inflation Got That Way

food crisis. We have some of that rather gloomy talk coming up. The selected highlights from a session I moderated featuring Big Jesus like the European Trade Commissioner and the Director General of the World Trade Organization. We also have some very clear thinking on the future of global trade from the brilliant economist Richard Baldwin. But what you never get in Davos is a sense of what any of this feels like at ground level. So let me start

this week's show with this report from Texas. While US Economy reporter Dmitrieva Midland, Texas is not the kind of place you'd expect high prices, but it's the city with the highest inflation in the United States. For the past six months, the consumer price Index from Midland, which tracts how much residents pay for everyday things, has hovered around ten percent. That's above even the national average. The city in West Texas is small, about a hundred and twenty

thousand people, give or take. It's remote, surrounded by oil fields, and almost a five hour drive to the nearest major city. These two things, a limited labor pool and remote location, are sending prices skyrocketing here and in other smaller cities in the within Midwest. And that's on top of the supply chain disruptions plaguing every region of the US right now.

Melinda Hernandez lives in South Midland. She's currently planning a high school graduation party for her son, usually a big event for her Hispanic family, this year it's going to be different thanks to inflation. Shopping for is food items, you know, just seeing that it's double from when I did the party for my first son, I would get less for more, so that makes sense. So it's just it's crazy to me. Hernando's lost her job at an

energy services company in March. The industry hasn't picked back up, so demand remains low. For administrative workers. Like her, service sector wages also leg far behind other industries. While she's getting paid ten dollars an hour delivering pizzas at night, less than half her old wage, everything else is going up in price. Her electricity bill has doubled, food prices are so high she had to tap a local nonprofit and church for help. And gas prices have been skyrocketing.

Make sure my elector bills paid and I have a roof over my head, and that's all that matters right now. Inflation was also in the mind of policymakers this week in Davo, Switzerland, gathered at the World Economic Forum for rounds of meetings, seminars, and unofficial holiday discussions. But if ready to Me comes down to inflation, we may see prices even going kaya being much more volatized. Raising interest rates is not going to solve the problem with inflation.

Taming inflation is one of the top global challenges in the post pandemic economy, but there's a big gap between monetary policy and the realities on the ground in places like Midland, Well, it's the best tool the Federal Reserve has. Raising interest rates doesn't address the problems of high food and gas prices and the drivers of that the war Ukraine and supply chain disruptions. The West Texas Food Bank near Midland has more than four cars lined up each

Wednesday for free food. The line grows each week. It's the longest since the darkest days of the pandemic. In Libby Campbell, the President says, food costs are increasing because of fertilizer prices and how hard it's getting to transport food into the region. Increased checks at the border with Mexico means lots of food is going to waste as it sits in line increasing prices in the region. It's just the cost of what things you know are to live every day, and it's truly causing us stress on

our community. The Federal Reserve and other central banks are raising interest rates, but it remains to be seen how much that will help in Midland. MMM. So, there's lots of interesting people here a Davos with grand theories about the world, But Professor Richard Baldwin is someone who actually has facts and experience to back up his theories. Professor of International economics at the Graduate Institute in Geneva and an author of several excellent books on different aspects of globalization,

which we've discussed in the past on Stephanomics, Richard. This has been one of those forums where people are getting into all the conversations about the end of globalization. You're someone who's charted the future of globalization from a particular perspective. What do you think about everything that's been said this week? The basic narrative is globally say is dying. There was some recent op ed pieces in the Financial Times as not there's a whole session here because the dying or

is the d global? I think it's just completely wrong. People are misthinking what globalization means because they're stuck in the sort of nineteenth century view that trade means goods crossing borders. Nowadays, if you write anything with trade, they stick a containership at the top of the article. And there are a lot of container ships queuing up around

the world. There are, there are, But since about the mid two thousand's, the trade and goods to GDP ratio has peaked and is declining, but the trade of services to GDP is continuing to soar. So my idea is that fundamentally globalization is driven by arbitrage and there's arbitrage and goods that was what we've had in the past. There's arbor grammage of services, which is just starting right now, people taking advantage of differences in prices and then sort

of trading those way. Exactly, it's an arbitrage on wages. So it's essentially working from home when homes abroad, but if home is Bogata, five dollars an hour is a middle class living. If you work two thousand hours a year for five dollars, that's ten thousand, and in most countries, ten thousand dollars a year is a middle class wage.

So instead of having your receipts checked against expense claims in New York or London, you offshore to Bogata and have it done for much cheaper and you integrate that way. So that kind of service, and it's important to point out that this is what we call intermediate services, not final services, because final services are very regulated, but all the inputs, if you will, the service value chain, is not regulated. So what kind of thing just in terms

of people can make the distinction in their heads. So for example, uh, if you're an architect, to do a building in Switzerland, you need a Swiss diploma. But to design the toilet blocks or decide how thick the windows will be, that all be outsourced to India or a Kenya, and it's the architect in Switzerland who's in charge of

making sure that it's good. But there are no formal regulations and barriers there, so it's only a question of whether this architect can work together closely enough with people in low wage countries to make everything cheaper. So that's that's what the whole sometimes called business processing outsourcing is intermediate services KPO. Knowledge process outsourcing is also that way, and a lot of the big Balta nationals called to service sector h shared service centers to do it um.

There's also these online freelance platforms which will give you very good idea what's going on. It's like eBay but for services. And that was something I remember you, you know, the big book that you wrote the last time that we speke was about that power of that of ai UM and even people who are people being able to do these jobs in the far flung country who don't

have English as their second language. You know, as you've got as you have a machine trying lation get better in best of that itpens up that whole market country. It was low skage, low skilled workers walking into factories. Now it's going to be low wage workers working into our walking into our offices. So that I must say that was one of my better calls. I did not know COVID what's coming, but I was telling people about this telemigration opening up the door to globalization and offshoring.

And I used to have to show videos of people working teleworking literally nobody like you, especially in Europe. They go, you can't do that from home, and now we all do so. Essentially we've had five to ten year advance and the ability to make remote teams in the service sector work together. So the ability to do this is exploding. But it was. The basic facts are that trading services has grown two or three times faster than trading goods. So it is a simple matter of calculation that trade

and services is the future of trade. And I guess it's also the case that some of this, if it's if it's digital transfers of services, it won't it won't potentially show up in a lot of these traditional statistics, even the services trade, you might find that you're not capturing enough. I think that that is really going to be the wave. The other thing to to to say about the statistics is they're terrible. They are absolutely terrible.

They were essentially designed to track financial transactions and they were held by the central bank, so they're called the extended balance of payment statistics. So the central bank would find an international financial transaction and if it didn't pass through customs, they would be pulling their hair out as

to where to stick it. And the central banks, without thinking anything about statistical analysis, put together a whole bunch of stuff just to give you a very One of my favorite examples is one of the bigger slices that

has been growing quite quickly. It is called Information and Communication UM services, and in there they stick the utility bits of payments for telephones and all the Indian I T offshore soft software, as if the utility had anything to do with the software if you wanted to do jobs or policy is in many countries don't separate them out, so it's really not fit for purpose, and it's one of the things we're just going to have to get done right because in the rich countries work in the

service sector and will be affected by this. But we can't, and we don't even have the basic statistics to say how much. So that it is. The statistics are really really disappointing, but no matter what you do, you still

see it climbing now. And another one I've been exploring is to see if we can think about the data flows for which there's a little bit better data as a proxy for services, because you can I mean, if you if you think about it, it's hard to imagine data crossing border that's not somehow related to somebody making money in a service, and so I don't think it's

a terrible proxy. And although that we don't have very good data for that, at least you can see how steeply it's rising, and if you take that as an indication of some service being sold across some border, it's enormous that can I just do say parathetically, Um, there's nobody in charge of measuring data flows in the world.

Believe that you should do another podcast on that. There's I was talking to people at the o c D and the International Telecommunication there's no international organization that keeps track of it, and there's a couple of private sector firms who trace the like the bandwidth not what actually goes through, but the bandwidth. But obviously there's a computer or a whole bunch of computers which having precise data on where it's going, when it goes, etcetera like that,

but nobody in the world gathers it. And everybody says data as the world's future. Nobody's gathering data. A funny feeling that you could talk to the giggles of this world and you would find that they had quite a lot of these days, so they might not find it useful to shap Let me just make a separate point.

The first breakfast two days ago, I went to Microsoft cafe and Brad Smith was there, president of Microsoft, and the Ian Bremer, who's the famous international relations guys, and we were talking of about Ukraine, of course, and the presenter said, uh, you know, the attack was I was hybrid to start with, and it started, you know, at the same time as the ward and Brad raised hand said, no,

it started twelve hours before the war. Because Microsoft monitors all the systems around the world, so they knew when the attack was happening in real time. And right next to him was the woman who was ahead of the cyber defense of the United States, and they cyber defense looks to I T companies to tell them about the cyber attacks that are happening. So you're absolutely right, it's the Google's Amazon Microsoft Web service in Microsoft to have

the data. Well, just going back on on Ukraine, because everything you said is very compelling, particularly from the standpoint of businesses who are thinking about how to organize their work across countries and just how to do it most efficiently. In the conversations that there have been endeavors, there's been

a big focus on new divisions between countries. You know, if the world does seem increasingly divided between the sort of US and Europe on the one hand, and a few other democracies and potentially China, Russia and countries that are at least not wanting to just to be separated from them, those kind of geopolitical forces, how likely is it do you think that that will affect the pattern of business relationships and even the ability to do this

kind of integration well, potentially long run. But one of the things I have been doing recently that that's beyond my book, is trying to develop measures of foreign exposure of supply chains to that with an economist at the Bank of England, Rebecca Freeman, and uh so, we use this these input world input output tables to try and

figure out how much you're actually buying from China. And one of the amazing things we found is that you're buying probably two or three times more than you thought you were because everything you're buying from anyone has China puts into it. So we were on the US auto industry. It looks like they depend upon two percent of the gross inputs come from China. If you do the whole calculation, the leontif as they call it, the roundabout it's about so they're going to have a hard time on scrambling

this onland. So they talk about disengaging with China and stuff, but I think that's mostly talked. You know, there'll be a few sectors where they semiconductors, maybe medical, uh supplies and things like that, but the vast majority, the truth is is that China is the opeque of industrial inputs for the entire world. And you can't shut OPEC off,

at least not very very quickly. So that I and who was it saying this morning, It was the UM I think it was the head of the American input at Export Bank, who was saying, there's all this jew strategic tensions. But actually, the United States exports to China this year are as high as they ever have been, and US imports from China have been as high as

they ever have been. So it seems like the businesses have not got the memo that they're supposed to be separating everybody and so and and just given how much of the world's manufacturing capacity is in China now and how specialized they are. You know, let's basically, all socks are made in China unless there's some sort of you know,

your mother knit them or something. There's because there's a whole village that makes socks, and nobody else in the world will set up that village to make socks just because Biden says, you know, we should separate. So that that's I find I don't think that. I think that disengagement's happening slowly, and there's a sort of in the digital world that's already happened, and we'll probably exaggerate, but in the physical world, especially manufactured goods, I think it

will be very very hard to unscramble that armor. China's global trade share had actually gone up quite significantly since COVID and in this whole period that we've been talking about, the accelerated deglobalization and even with all the supply chain issues and everything else, they have increased their share of global trade. Final question for you, Richard, I've got to do a session with the head of the w t O and I should probably get some questions from you,

the best questions to ask them. In the world that you've described, it doesn't seem like there's much of a role for this traditional World Trade organization and those kind of trade agreements. Well, I think the days of traditional trade agreements are over. But actually the W two has moved beyond the old big rounds things where the old days it was everything had to be agreed before anything

was agreed, and everybody had to agree with everything. But my my song right now is that we really need the w t O to get the cloud and the attention of heads of state because the great challenges of our time, climate change above all, will not happen unless

trade goes on. So let me break that down. Mitigation will require technology to move from a handful of countries to the entire rests of the world, and that technology is generally embedded in goods, services, investment, and intelectro property rights, all of which need to cross borders. And if it's going to get paid for, because it's not going to all be done on charity, there has to be lots more trade going back the other way, potentially trade and

services for example. So if we fall into the world where this disc disagreements over commercial matters breaks down the trading system, we will not get a climate rescue. So I call it the w t O Rising Imperative. And we absolutely need G seven G twenty leaders to say we need this to solve humanities problems. Just to take

a very specific one food. If you look at the I p c C report and the f A report that we are going to have an extra billion people in places which increasingly can't grow their staple crop because there's not enough water heat. So you have three options. Either we do more trade and food and the technology to allow them to do it, or they die or they move all. The only one of those that's acceptable is more trade. And if we get into a world where there's a sort of breakdown us China spills over

nobody's cooperating the rules aren't respected, that won't happen. So it's I think it's it's time to start realizing that fixing the world's problems means moving things from where they're abundant to where they're scarce, and in particular technology, and that though technology which is answered to basically all of our challenges, in the future will require a well functioning system. So I hope they'll start to think of the W two like the w h O, which we actually needed

during the COVID. It has it has its own problems, but nobody's thinking about the w h O, where you send some ambassadors and trade ministers to haggle over commercial disputes. We realize that these this organization was critical to saving hundreds of millions of lives. Well, I'm going to be talking to the head of the World Trade Organization. I will make check in see whether she's ready for that, right,

Thank you very much, rich Reportman, Thank you. Now. Straight after that chat with Richard Baldwin, I did have the pleasure of leading a conversation about the future of global trade with not only the Director General of the World Trade Organization Dr. And Gorzia corn Joy Wheler, but also the Indian Commerce Minister, Pios gal and Ryan Peterson, chief executive of global logistics company Flexport. You'll hear all of

them in a minute. But I started the panel by asking Valdis Dombrowski's the European Commissioner for Trade and Executive Vice President for the Economy, about the European Union's response to the invasion of Ukraine. Specifically, given the internal tensions around further limiting energy imports from Russia, I asked him whether the European Union was reaching the limit of what it could do to punish Russia. Minister, well, you won't be surprised that I will ask you a question on

this topic. India has made it very clear that it needs to buy cheap oil from Russia. It's buying more oil discounted Russian oil, and it buys more Russian weapons than any country in the world. The US has been understanding about India's position, has said they're sort of playing the long game though, because they believe ultimately that the US is the key strategic partner for India. So can I just ask you what steps are you taking over the longer term to reduce dependent on dependence on Russia?

Even as you buy more from Russia. Right now, I think we've been very clear from the beginning that dialogue is the way forward. We must sort out this dispute. It's doing nobody any good and it's important that we that all the concerned countries and the neighbors find a solution to this very very unfortunate conflict. In terms of India's own dependence on oil from Russia, we have never traditionally been a very large importer of petroleum products from Russia.

In fact, on an earlier occasion, our Foreign Minister has clarified that we buy le petroleum products from Russia in a month than what is consumed or bought by the European countries in an afternoon. So therefore, I think any suggestion that India is increasing imports from Russia is any way contributing to the situation suddenly doesn't stand scrutiny. Over the years, there have been a friend of India, and we believe that the right way would be to find

an amicable solution. In terms of the long term, India has always looked at diversified sources for our petroleum requirements. But in the current situation, when inflation is at an all time high. It has caused severe stress to people all over the world. The European Union and other countries in Europe continue to buy far are more larger quantities than India has ever even thought of buying or will ever buy. So I don't think at all India at this point of time is in any way responsible for

the petroleum exports of Russia. Having said that, I must also placed on record that I was personally advised that there is no sanction on petroleum production, petroleum goods or food grain procurement from Russia and no sanctions have been placed on that by senior leaders of the coalition which has put in the sanctions. So I think India as well within the current framework which has been designed by

the countries who have put put in the sanctions. Obviously, one of the very worrying UH counter effects A side of efects of the crisis in Ukraine is this growing fear of a food crisis and food short global food shortages. What what practically are you thinking about in your position to help governments respond to this crisis. Is there anything that the w t O can do well? Thank you? Certainly, the food crisis is a real worry, and it's not just about this year. I think it might be about

next year even beyond that UM. And the reason I'm saying that is if countries are not able to get fertilizer UM to to plant the next crop those that need fertilizer, then yields are going to be lower. There will be less supplying the world across the board of

all types of grains and food. UM. If we are not able to evacuate the twenty five million tons or thereabout of Ukrainian grain that is presently stored um and the harvest is next month for another twenty five million terms, then that's going to be really, really difficult for the world. So I'm saying that this food crisis is real and we must find solutions. Of course, if the war stopped, that would be the quickest and best solution for everyone.

But have said that if we had corridors open on the Black Seat to evacuate some of Ukrainian green, that would help. If we don't find solutions, of course, the ones countries that would suffer would be the countries, the poorer countries of the world. Now at W two, what

are we trying to do? One is not to exacerbate the problem by having export restrictions of prohibitions of members, because that tends to take the prices, make for more volatility and and and you know prices can spike if we if we do that UM, So our members the message to them is to try to restrain. Although it's not against w T rules. UM. If you have that, for there's a security clause that allows that to be done, but it has to be temporary, proportionate and transparent and

reported to the w TU UM. But so far now we we have about twenty two members who have export restrictions and the idea is for that to be lower. So we don't take us a bit the problem I think are members have taken that on board. UM. The second issue that we're looking at is of course auto multiply the supply on the world market. So any country that has additional grains that they can put on the world market, we're encouraging that very much to be the case.

Can I come back to your commissioner very briefly just to ask are you talking to Russia about creating solidarity lanes in the Blacks to allow grain shipments from Ukraine? Well? Uh, First of all UH in this conflict, they need to be clear who is aggressor who is a victim, And it's Russia's unprovoked and illegal aggression against Ukraine which is creating the problem. So correspondingly, we are engaging with Ukraine,

trying to help Ukraine to deal with this situation. Obviously, UH the discussions on different ways how the grain shipments can be done, So already now we are ramping up the capacity to do it, and the shipment is already happening through the land corridors through UH Poland, through Romania

and from those ports, but clearly it's not replacement. Were also assessing other land options to get to other ports, but clearly UH it's not able to replace in a short term the UH UH, the sea roots UH and and the fact that currently Russia is blocking Ukrainian ports

and this export of grain is not possible. And in meanwhile, of course, we're seeing seeing other tendencies that Russia is looting Ukrainian grain from occupied territories, it's burning down Ukrainian food storages in other territories, it's destroying other Ukrainian agricultural infrastructure and equipment. So clearly there is a deliberate action

of Russia to create these globals food security issues. I guess that's why I wonder why we think why it seems possible that you might have those that safe passage when the Russians have made clear that they are willing to sustain an enormous amount of humanitarian collassal damage. Well,

that's why we're working on different directions. Of course, if there is a way to open those UH corridors for Ukraine and grain exports h through as the Black Sea from Ukrainian imports excellent in parallels I said, they're working on other land routes, beating up capacity, simplifying procedures, administrative procedures, customs procedures BOSS for Ukrainian imports to the EU and

for transit to other countries. Ryan Peterson, what are you seeing when you look at supply chains, when you look at the collateral damage in the trading system that businesses at dealing with every day from this crisis and from the other snarl ups that we've seen. Well, we've seen um the last seven or eight years that you've had it almost every single year in increasing level of disruption

in global trade. Um. Starting you can go back to Tift when we had a strike on the west coast of the United States and you couldn't import anything into into the United States. Uh. We may have another one this summer. The tract is up for renegotiation in July. Um, you've had we had the cheapest ocean freight of all time. Everyone likes to talk about expensive ocean freight. Was the

cheapest ocean freight probably in the history of humankind. Uh. Great for importers and exporters, terrible for the asset owners. They almost went in fact, Huningen did go bankrupt Korean Ocean carrier seventeen eighteen nineteen, we had trade wars, we had a pandemic which caused a collapse in purchase orders, and then the worst sport congestion that we've seen all over the world. And trade has never been more difficult. And I think it's an interesting moment to ask is

globalization going to continue? Are we going to be able to continue to trade or is it going to fray?

And um our system depends on peace, rule of law. Um. We've we've built like an incredible amount of prosperity off of the global trading system that is at risk right now and it's um terrible to see the human implications of that, and it has me very very concerned because it uh we look at what happened with the Arab spring and all these government really anarchy almost in the Middle least, and that was really the result of high food prices. And I don't know how to make predictions

because my predictions have been wrong the last few years. Uh, but I'm still willing to do it, and I predict you're going to see similar levels of crisis across any food importing nation, especially the poor ones that don't have fossil fuels, and that has me very very concerned. Tots. He actually mentioned the question about food security and potential

what might be considered food protection is um um. So there is a question, how does India intend to prevent its recent wheat export ban from negatively affecting food security in developing countries? And I see you've also limited sugar export. Yeah, I'm glad you asked that question because there's a lot of misinformation going around the place. Until two years ago,

India had no exports of it at all. Two years ago, we had a nominal surplus of two million tons, which is barely one percent, only one percent of global weight trade that we had as a surplus which we allowed to be exported last year. This year, starting April, our estimate was that we would produce hundred and eleven million tons, against which our domestic requirement and consumption is about hundred and five million tons, so we thought we would have

about six seven million tons again which we could export. Unfortunately, there was a huge climate problem. We had a heat wave in most parts of North India which is in public domain. Most people, I'm sure know about it, due to which the wheat got shriveled and our production fell significantly.

In fact, dtr andengs the fields. It has fallen even more than what we estimate, due to which we would actually have to draw from our food security reserves to even ensure price stability and food security of the people of India. In this situation, from first April to tenth of May, in forty days, are we exports increased six times six or what it had what had happened in

the forty days last year. So we saw two million tons going only forty days, and the speed with which it was going we would have had a crisis in our own country for food stability, food security and pricing, and therefore it was an imperative that we regulate what

is being exported. Even now, we have left the window open for countries on a government to government basis to take wheat from India, because we don't want the surplus suet available, if any, to go into the hands of speculators or holders who would then charge an arm in a leg to the less developed countries, of the poorer countries who would need that or the vulnerable countries who

would need that drain. Analyze the exports and we found instead of Bangladesh or the less developed countries, it was actually being exported to trading centers from where they would have all the ability to manipulate prizes. And therefore we regulated it. And therefore we believe this is a step in the right direction to ensure equitable and social distribution

of any surfaces. That we have a lot of conversations that people will have been in this week, and one way or another ended up with um the fragmented fragmentation of the global economy and the global institutions still function that they still have as a role when major members of those institutions no longer seem to be heading in the right direction. How do you make the w t O fit with the world in which people don't agree?

I must compliment the Director General, Miss h and go Z, because it's a very tough job she has on our hands. I I don't think any of us would end me a job. Nobody would like to be that seat in the current challenging times, particularly when she has to balance the interests of the less developed of very poor countries, the developing world which has the less the smaller income, the middle income, the higher income, all within the developing world,

and then the very developed countries. By compliment her for her patience, for her ability to bring so many different interests on the table and persevere for a solution. All right, well, I'm sure she's very glad to have that compliment, But why don't you help her? How are you going to Actually you're all helping. They're all helping, And I think we've all agreed even today in an earlier session, to look at how political consensus can be drawn trying to

bring equity with different interests on the table. Can I can? I? Well, thank you Stephanie for eliciting so much love for me it's wonderful. Um. I just want to say that, you know, as a peuge mentioned is very difficult to agree things multilaterally and that has been plague in the w T and we shouldn't break light of it. And that's why we need to find ways forward to agree some things to show that the organization can confunction. Um. But what I wanted to say is, let's not take the multilateral

trading system likely. You know, people are talking a lot of fragmentation of moving away from multilateralism. In practical terms, there's a lot of geopolitical tension. But the counter factual to having a multilateral organization people need to look at that is very costly um. And and you know, only the poorer and weaker countries would suffer because if if you don't have such an organization, imagine a poor country in a developing part of the world trying to have

a bilateral agreement with a larger country. How do you think that will look? If you had to do that for almost everything, it would be very difficult. So we need that multilateralism. Lastly, some problems we have now of the global commons cannot be solved by any one country alone, and we are facing these simultaneous crisis of the global commons, which needs the kind of solidarity that a multilateral setting provides. Therefore, you can't solve the pandemic on your own, you can't

solve climate change on your own. You can't even solve food on your own, because we have net food importing countries who don't have the ability to grow their own food. So we are in it together, and therefore that's why we need to strengthen organizations like the w T and make sure we don't take it lightly about its breaking of all in a part. Well, I've just noticed we've

probably run out of time, so but I did. There's quite a few questions to run Pietres were various versions of the same one, which is, can you tell us how I t and help solve some of the trade disruptions that we're seeing. Yeah, and so I run a technology company. So you probably think I'm going to talk about big data or machine learning satellites, but actually the technology that take is going to be the most important in the next year or two is an ancient one.

We've actually a two thousand years ago. Maritime insurance was invented in Rome to provide security for people who are going to Egypt to get grain and bring it back to Rome. And we're gonna need to find insurance solutions so that ships can go into the Black Sea in a war zone, get grain and leave. Because I don't know that the private sector alone is going to do that. I think they'll end up uh not wanting to take that risk. If I own the ship, I don't want

to lose my ship. It's too expensive. And this is where a role for government perhaps can come in uh and provide some kind of a backstop of insurance that was we've seen in many other places. I think something like that is probably the most important technology right now. Well, like many conversations this week, it's begun and ended with

some aspect of the Ukraine crisis. But in the meantime, I'm we've got a bit of help, certainly a lot of love for Dr and gosi Um and some explanations of of the other relevance of trade policy at the moment. So thank you very much, speaker. Well that's it for this bumper episode of Stephanomics from the World Economic Forum. We'll be back next week, but in the meantime, do please rate the show if you like it and check out the Bloomberg News website for more economic news and

views on the global economy. You can also follow at economics on Twitter. This episode was produced by Magnus Henrickson with support from Summer Sadi. Special thanks to Katia Dmitrieva, Professor Richard Baldwin, the World Economic Forum, dr Angrzio, Condroy Wheeler, Minister Pure Brian Peterson, and Commissioner Valdis Dombrovskis. Mike Sasso is executive producer of Stephanomics and the head of Bloomberg Podcast is Francesco Needy.