Rabobank: The Post-WWII Order Is Gone and Central Banks Can't Fix It

Rabobank's Global Strategist cites a Dutch government advisory body's blunt verdict: the old world is gone, oil inflation is structural, and rate policy is a sideshow.

Key takeaways

• The Netherlands Scientific Council for Government Policy, an independent Dutch government advisory body, concluded "the world as we knew it no longer exists," a finding Rabobank's Michael Every is circulating to institutional clients this week.
• Every argues central banks are "secondary" to the geopolitical forces driving oil and refined-product inflation, which cannot be resolved by rate cuts or rate hikes alone.
• Europe's own think tank has narrowed the EU's viable responses to three options, every one of which is either inflationary, destabilizing to the euro, or both.

Rabobank Global Strategist Michael Every published a client note this week citing a Netherlands Scientific Council for Government Policy (WRR) report that concluded "the world as we knew it no longer exists," and arguing that the inflationary backdrop is now structurally driven by geopolitics, placing it beyond the reach of conventional monetary policy. The WRR is an independent statutory advisory body to the Dutch government, not a bank research team or a think tank funded by financial interests. When that council publishes a conclusion that blunt, it is a policy document.

Every's note, distributed via RaboResearch, frames the current moment as a convergence of active wars, energy market dislocations, and institutional realignment that central banks are structurally unequipped to address.

The Structural Inflation Case

Every's core argument is specific: oil is on pace for its largest weekly gain since July, crack spreads remain elevated by Every's characterization, and stocks of refined products including diesel are critically low per Every's read of the market. That combination is not a demand shock a rate committee can resolve. As Every puts it directly: "Central banks are secondary to that dynamic except where they act on 'second round effects' or help on the peace or 'arm up' fronts."

The inflation feeding through diesel and refined products goes into the cost of moving everything. It unwinds only if both active wars end, new refinery capacity comes online years ahead of any realistic schedule, or demand collapses under its own weight, which Every identifies plainly as stagflation. None of those outcomes are within a central bank's mandate or toolkit.

The BOJ situation underlines the point. Every notes the BOJ "looks like it's being leaned on by Bessent to hike" to stabilize U.S. markets, with the 155 JPY level cited as a threshold beyond which accumulated shorts could unwind sharply. A central bank hiking because a U.S. Treasury Secretary wants dollar/yen managed is a node in a geopolitical settlement, not an independent monetary actor. The sovereign debt spiral that Lacy Hunt and others have been tracking is accelerating under precisely this dynamic: fiscal imperatives now dictate monetary posture, not the other way around.

Europe's Three Bad Options

The WRR's analysis of Europe's position is the most consequential part of Every's note. The council narrows viable EU responses to three paths: international coordination (a Plaza Accord-style arrangement targeting China), "strategic symmetry" mirroring China's neo-mercantilist posture, or stronger trade defense including tariffs and potential taxes on capital inflows.

The second option is the one that should stop readers cold. The WRR explicitly states that mirroring China's approach would require "the ECB to depart from its current policy of a freely floating exchange rate." That is a statutory advisory body to a European government putting managed exchange rates on the table as a legitimate policy option, not a fringe analyst floating a trial balloon. The architecture of free-floating fiat is under formal institutional review in Europe. The ECB has already signaled its discomfort with the current settlement layer; exchange rate controls would represent a far sharper rupture.

As the WRR itself acknowledges: "Clearly there is no easy pathway...This reflects the fundamental tension at the heart of this debate: the desire to maintain the international multilateral trade" order.

All three paths are inflationary, growth-constraining, or destabilizing to European capital markets. There is no deflationary off-ramp the ECB can engineer from its current position.

The Dutch central bank's own behavior has been consistent with this threat assessment. Earlier this year it repatriated gold citing geographic concentration risk, a quiet but legible signal of how seriously Dutch institutions are taking sovereign asset security in the current environment.

What the Thesis Requires to Hold

Every's falsifiable claim is this: when things unwind, it is "slowly at first then all at once", a non-linear process that markets are not yet pricing. The thesis holds as long as geopolitical forces remain the dominant driver of energy costs and central banks remain subordinated to political pressure from finance ministries and defense postures.

The thesis breaks if central banks demonstrably re-anchor inflation expectations independently: oil falls back below pre-conflict levels, crack spreads normalize, and the BOJ, Fed, and ECB stabilize their currencies without political direction from above. If that happens, the conventional playbook reasserts itself and Every's framing was noise.

Watch the diesel inventory numbers from the EIA's weekly petroleum status report and the JPY level around 155. Those two data points will tell you faster than any Fed speech whether the thesis is holding.

Sources

• Michael Every, RaboResearch author page
• WRR (Netherlands Scientific Council for Government Policy) publications
• First reported via Rabobank daily note, republished by ZeroHedge