It started before the war.<p>The cash that the governments printed via negative interests to give to the VCs and to real-estate owners really skewed the local market (increasing both prices and costs of producing).<p>The Estonian gov has basically no tools to fight against the real estate bubble either or to bankroll the most fragile startups (and they may not be as strong as they seem), so we're basically fucked.<p>Regarding energy, we had 4000 EUR / MWh prices a couple of weeks ago for an hour.<p>Think of it as oven / sauna / air conditioner costing you 10 to 25 euros per hour (if I remember right, it didn't matter that much when you have no other choice than turning them off).<p>For energy this is mostly because of the war, but ecological policies also affected (Estonia was known for "dirty" petrol, known as shale oil, and they are restricted there).<p>The only retail companies that try hard to provide good prices are LIDL and IKEA, and in that regards, they are great.<p>Other distributors have very poor logistics as they consider Estonia as the very end of their distribution chain (no matter if for Baltics, or for Scandinavia we are at the end of the West).
The utter stupidity of thinking that sanctions could be an effective response or deterrent to military aggression boggles my mind. Force must be countered with force, nothing less. Anyone willing to expend soldiers lives is not going to be deterred by mere economic pain (the pain they've already chose, i.e. war, is much worse!). We don't impose monetary fines on murderers, we capture them and put them in jail, or kill them in the process.<p>Furthermore, sanctions, by definition, hurt both parties. It is impossible to design a boycott that doesn't hurt both the buyer and the seller. The only question is: who gets hurt more? If Europe was so determined to "stand with Ukraine" then they should've put soldiers on the ground over there, not shot themselves in the foot with sanctions on goods that they need.
Inflation that's not to do with wages seems a different problem to me.<p>If gas or tomato prices are going up such that everything that uses gas or tomatoes goes up. You could say that's inflation because gas and tomatoes are so widely used.<p>Or you could just say it's a price signal. You need to use less gas/tomatoes as they are in short supply.<p>It doesn't seem to be as circular as the wage based inflation, where the higher wages and the higher costs are the same thing and recurse.
Properly managed, the Baltic states in particular will come out of this energy crisis as winners. Green energy is the very obvious answer for them, even more than for other countries. Cheap and reliable.<p>They have all that's required to be self sufficient and even exporters in terms of energy:<p>- little heavy industry<p>- very low population density in rural areas<p>- mostly centralised heating networks in urban areas<p>- plenty of cheap biomass, mostly for use in winter<p>- a fairly decent bit of sun, mostly for use in summer<p>- plenty of hydro power [0]<p>- fairly good hvdc interconnects<p>- plenty of cheap EU cofinancing<p>- a population largely ready to stick it to the godfather in Moscow<p>[0] <a href="https://en.wikipedia.org/wiki/List_of_power_stations_in_Latvia#Hydroelectric" rel="nofollow">https://en.wikipedia.org/wiki/List_of_power_stations_in_Latv...</a>
I guess this time we can admit a supply problem is to blame and not the usual money printing/government spending explanation, since Estonia is well known for having a tiny debt to GDP ratio.