With respect and greetings,

When I was in high school, my math teacher always said, “Understanding the problem premise contains half the solution.” Over time, my life experiences have shown me that ignorance of the problem makes the solution impossible. The jump in inflation is like a problem that, not understanding it causes it to increase sharply. I would like to point out here that inflation is not an unknown economic disease like Corona that the world is currently unable to cure. Rather, it is more like diseases such as plague, malaria, etc., the treatment of which has been found for a long time. Economists have found that inflation is caused by disproportionate growth of liquidity with GDP, which has led to the devaluation of the currency, and that the devaluation of the currency is directly related to rising general price levels. After a brief and useful review, the devaluation of money results in the fact that the main reason is the creation of money without the support of economic growth, which then leads to rising prices or shocks such as foreign currency shocks, and not vice versa.

In most countries, which have moved from normal inflation to high inflation and from high inflation to super-high inflation or so-called back-breaking inflation, attempts have been made to throw inflation into the future under various excuses, and the lack of economic planning has led to the stabilization of inflation in those countries because the economists of those countries, instead of using a conventional anchor to stabilize the economy of their country, have used an outdated anchor.

A study of various books on economic policy in countries facing inflation shows that the anchor of the exchange rate has never been and is not a suitable anchor for price stability.

A study of price stability in successful and developed countries shows that they did not confuse relative price fluctuations or exchange rates with inflation and shifted their commitment and responsibility to the price stability of consumer goods, not the fluctuation of a rate in a basket.

Therefore, thinking collectively and cooperation are needed to prevent the recurrence of economic instability. Here we need to study the destructive effects of inflation on the packaging industry. If the price of raw materials in the packaging industry rises by leaps and bounds, the country’s industry will suffer from a further recession in the consumption sector.

As the study shows, more than 50% of GDP belongs to household consumption (and household purchasing power will continue to decline further due to inflation). As we experience in the packaging industry, due to the increase in prices, other industries in the country do not show a tendency to cellulose packaging, and the desire for cartoon packaging is decreasing day by day.

In this case, the supply of packaging raw materials will be more, but the trend of demand will be negative. Therefore, the producers of raw materials in the country are again asked to provide a way out of this problem so that they do not have problems in production in the near or distant future.

To be continued in the coming days,

Thanks,

Tahmasebi