Big Gambles Heading Into Gusting Headwinds
There is no assurance at all that the tech prospect will materialise. It may, but it may not. And that is a huge gamble.
The economic forces – those post war strong tailwinds – that have shaped the last 35 years, and which accelerated gilded journeys through the western ‘plentiful era’, are no longer blowing in a favourable direction. They were already slowing, but now are reversing.
The winds now have shifted 180° in direction – they are gusting headwinds. This is a structural shift within a long cycle. There are no quick ‘silver bullet’ solutions. The ‘Cabaret’ good-time years are gone. We will have to ‘make do’ with less; and consequent political volatility is inevitable.
China had earlier industrialized, giving us inflation-killing, cheap manufactures; Russia gave us the cheap energy that kept western economies (just) competitive, and (almost) inflation free. A ‘Frictionless Ease’ at that point characterised the movements of goods, capital, people – everything. Today however, it is Friction and Impediment that is prevalent.
The ‘turn’ began with the US determination to not allow an Asian ‘heartland’ to supplant it. But the shift has acquired its own powerful momentum, now generating severed trading blocs that are determined to shake free from ‘old hegemonies’.
In place of ‘Frictionless Ease’, we have economic de-coupling: sanctions, asset seizures, legal protection degradation, regulatory discrimination; Green Agenda and ESG discrimination; national security ‘ring fences’, and narratives that cast swathes of hitherto mundane economic activity into borderline ‘treachery’.
Simply put, there is friction … everywhere.
On top of this general transition to friction, there are distinct dynamics that are turning a frictional base into raging headwinds.
The first is geo-politics. The multi-polar sphere is rising. But it’s ‘pull’ is not just for multi-polarity, per se; it is essentially about the re-appropriation of national autonomies; of state sovereignties and the recovery of discrete civilisational ways of being and values by aspirant multi-polar states.
As Ted Snider has succinctly puts it:
“The monopoly of the dollar has not just assured US wealth: it has assured US power. Most international trade is conducted in dollars, and most foreign exchange reserves are held in dollars. That dollar dominance has often allowed the US to dictate ideological alignment or to impose economic and political structural adjustments on other countries. It has also allowed the US to become the only country in the world that can effectively sanction its opponents. Emancipation from the hegemony of the dollar – is emancipation from US hegemony”.
The flight from using the US dollar in trade therefore becomes the key mechanism to replacing the US-led unipolar world with a multipolar world. Plainly put: the US has over-used its weaponization of the dollar, and the tide of world opinion (even that of President Macron and some other EU states) has turned against it.
Why is this so important? Simply, it has begun a global ‘run on the dollar’ – rather like a ‘run on a bank’, as confidence ebbs.
The second dynamic is the in
Article from LewRockwell