Thought I recognised Brian's hand in a section of that essay.
Do you think the 'West' can go back to the post-war level of consumption, along with milk co-ops, simple bottle recycling, and strong unions? And not "Changing your entire kitchen every two years because fashions have changed"?
Or will 'we' continue the current neolib headlong course until we crash and burn dramatically?
The CIA puppets in charge of European countries seem to want the latter. And a catastrophic major war with Russia thrown in for good measure.
It matters more what the global south/global majority/developing nations do, than what 'the West' does. For them, global trade is their hope for a brighter future.
Trump's tariff policy is incoherent. Unlike China, the US doesn't have an industrial policy. No one knows which sectors are to be protected. Ideologically, an industrial policy may be viewed as "socialist", which might explain their refusal to consider it.
Across-the-board tariffs, without any cost/benefit analysis, is stupid. There is much trade that is mutually beneficial, or beneficial for the US. Curtailing it is shooting yourself in the foot. And by no means are tariffs the only instrument for altering the terms of trade. Quotas and tax policy are alternatives. If the US were serious, those measures would be employed in a coherent manner.
No one is forcing the US at gunpoint to import more than is exported. Countries that run persistent trade deficits obtain goods and services. Trade surplus countries accumulate foreign currency. By definition, there is no avoiding these outcomes. It's a matter of accounting. Whereas the consumption of goods & services is regarded as more beneficial than the accumulation of foreign currencies. China is being virtuous by manufacturing what the world consumes. Yet Trump believes that trade deficits are a rip-off. He may as well believe the moon is made of cottage cheese.
Yes, our current living arrangements are unsustainable from a resource standpoint, but what the Trump regime is doing is evidence of their incompetence. Bad leadership can result in immediate and short term consequences, irrespective of external conditions. The decline of the US is the culmination of decades of corruption and delusional ideological thinking. Other nations have fared better because their policies and leadership were better.
Speak for yourself! I'm going to impose tariffs on all the credit companies that lent me money so I can buy shiny things - that'll teach them to treat me like a mug!!!
In my opinion you can actually stitch together his stealth policy from his prior actions in his first term and what he has done over the course of the tariff war: during the corona-crisis he spent a load of money, with most of it going to the business/oligarch class. Everyone else got a pittance of some checks, which was the right thing to do, but was dwarfed by the amount of money going to the wealthy.
Obviously, as you rightly point out, he has no stated industrial policy and has made no moves to even suggest there is one that is being worked on behind all of the media screaming.
Instead, what I see is two things: using trade policy to try and isolate China and claw back some of our trading partners that China earned over the last decade and a half. You can see this in his cancelling of tariffs on 90 countries but leaving them in place in regards to China.
The second things is a rhyme of what I mentioned during the corona-crisis: these tariffs, and all this 'money' we are getting back, and all the wealth he is trying to claw back is going to the rich. There is a side-benefit of increased domestic hiring and production, though the later is barely perceptible at this moment and will at best be minor, especially as I mentioned in another comment, there is nothing being done to increase wages. If anything wages will stagnate worse than before. Overall, however, the main point seems to be getting money back to the oligarch class, and obviously he isn't going to write that down anywhere MAGA can read it, you have to basically interpret it from his prior behavior and by looking at who materially benefits in the now from disrupting global trade.
Yes, indeed. And this preparation would be a concerted effort to move as many people out of cities as possible. They would create small farms where those ex-urbanites could provide for themselves using the low-energy techniques that are eventually going to be the only techniques possible.
But asking the governments of modern countries to overtly disavow modernity and prepare for the post-modern era is a big ask. No one, not the politicians nor their constituents want to do it. Only a tiny trickle of doomer-preppers are getting ready (in modern countries). I suspect this will never change and that modern industrialized economies will rapidly disintegrate without any real preparation for what comes after.
Fortunately, there are millions of small subsistence farms in the Global South already supporting millions of people in the style to which everyone will need to become accustomed. They were left behind by modernity but are soon to be the vanguard of humanity.
I completely agree with Bloomburg's take that these tariffs are a "dress-rehearsal for a war with China." In fact, as an American, it seems like our political class is so dysfunctional that nominal preparations for war with our geopolitical adversaries is that only thing that keeps oligarchic infighting under control.
The RAND corporation's 2016 paper about gameplanning a potential war with China sheds some light on the current trade situation.
Like Britain preparing for war with Germany in the early 20th century, our plans for China involve a long-range blockade to choke off international trade. Indeed, this strategy is so obvious that it is reflected in the decades-long planning of both countries, including the Belt and Road Initiative and the various "island chains" of military bases maintained by the United States.
The USA believes it can cause greater economic damage than it will suffer in a war with China, leading to the collapse of Chinese society. (Considering the privations that the Chinese suffered less than a century ago, this seems ridiculous, but whatever.)
However, the USA realizes that imports from Russia and Iran, especially in the form of fossil fuels, would enable China to survive this blockage and possibly outlast the United States. This, I believe, is the primary reason why there has been such an intense effort to forment regime change in Russia and Iran over the past decade.
And now, we're "decoupling" from China so that we can better prepare for the economic shock for then war arrives. Personally, I think that we're so outmatched that our generals would never allow the politicians to start such a suicidal war with China, but perhaps that is me being hopeful.
Fascinating. I have been thinking a lot lately about how the USA generals have been viewing this. The generals running the show have no room to engage in nonsensical ideologies. I have been wondering if the USA may see a coup d'état and a military enforced command based economy take over. Or maybe the USA military leadership is as foolish as the politicians and is gung ho for a direct confrontation with China.
The thing "we" were all immersed in since birth - was/is based on artificially imposed hierarchies, laws, experts, institutions etc etc. It's all, and always has been, fake.
All the 'progress', all the technology - none of it was a good idea. Who did it benefit, really? What was the point of having machines do things quicker? Who gained from it? Answer: profit, for the owners of the machines (also the owners of the system).
'Civilization' itself is fraudulent.
Understandably, that is very hard for many to accept. But true, nevertheless.
Once such a system was in place, what could "we" do? It's impossible to escape it, for the vast majority.
Where did it all go wrong? Maybe from the accumulation of surplus via agriculture, leading to wealth (and the flip side, poverty) idk.
All the 'good bits' - the healthcare, the pampered existence, the gadgets etc, are completely outweighed by the bad bit: being governed by parasitic psychos.
'Entertainment' and 'leisure' exist to distract the masses from this invisible prison - but just like food, shelter etc, those are things that people evolved to provide for themselves and each other, not things that inhuman, or anti-human, corporations ought to provide.
The only time humans were ever free was when they were responsible for their own fate. In other words, sans governments, nation states, police, courts, schools, hospitals etc etc etc...
When there were no hierarchies to enable/protect the psychopaths.
"Where did it all go wrong? Maybe from the accumulation of surplus via agriculture, leading to wealth (and the flip side, poverty)"
I'd be more specific: since the advent of *grain* agriculture.
Before grain, no one could accumulate trophic energy for more than a year or so, before it spoiled or rotted. So human social structure — and the damage that it could do — was flat.
Grain was the first food that could be stored for a number of years, leading to hoarding and withholding, social stratification, hierarchy, "power over", rulers, and indeed, money and capitalism, as granary receipts were traded for other goods and services.
About the same time (~7,000 years ago), a hazelnut civilization was thriving in British Columbia. There was long-distance trade, and varieties from all over BC have been found in the focal point, near modern-day Hazelton. It may have lasted thousands of years, longer than most other civilizations.
But hazelnuts go rancid, and can't be stored for very long. Evidence indicates it was a fairly egalitarian civilization, lacking the usual artifacts of wealth and power.
The sooner we descend to a lifestyle where we have to provide our own daily sustenance, the better off the survivors will be.
We lived hundreds of thousands of years before agriculture in small tribes where everyone knew everyone else. There was no accumulation of wealth because we lived in the moment by hunting and gathering. And the "work week" was amazingly short, 15 hours or so allowing for a lot of free time. Life was not idyllic but at least equitable.
Agriculture was a Pandora's Box and once that box was opened there was no going back. It allowed for the worst of us to usurp the growing wealth that was produced. A select few enjoyed the benefits and the rest were subjugated to what was in effect slavery. Later a system was set up to control the masses. Religion and armies were key to this and were effective in keeping control.
How can we undo this clusterfuck? We can't. Agriculture also allowed for the increase in population to the point where we are now using up all of our resources and soon they will be gone. We have been to smart for our own good.
"In their folly they failed to realize that it really doesn’t matter who wins, as resource depletion, climate change, growing wealth inequality, falling living standards, plummeting birth rates, disintegrating societies and the failure of technology and science cannot be stopped by waging wars."
Exactly! It's a race to the bottom.
The graphic of primary trading partners 2000 & 2020 was eye-opening!
I think MAGA will realize some dissatisfaction with Trump once it hits them that wages are not going up; I make decent money in a specialized trade, but overall things are getting worse and worse and basically I am learning another language because unless something good happens - and this in unlikely - I will have to leave the country. Most people are not like me: I am not special by any means, but I have a lot of specialized experience and enough intelligence to do something like learn a foreign language relatively quickly. Most of MAGA can never do this, and probably wouldn't commit to it even if they could.
DC probably has some tricks to keep inflation relatively low for a while, but there is nothing short of raising the federal minimum wage to make wages go up. Companies have learned they can keep paying the same rate for more labor output and there is nothing anyone will do about it. In fact, companies have started to offer training for specialized labor for new people who have no experience at all - even unrelated - because that is 'cheaper' than raising wages.
Once it becomes obvious that the stock-market isn't going to really recover, so boomer MAGA 401ks are shot, I think that will be another blow to Trump. His recent aggression towards the fed might make the libertarians happy, but removing a tumor with brute force that is integrated into your heart and lungs is a stupid idea. Bonds and treasury bills are edging closer up, silver is now somehow moving despite JP Morgan's market manipulation, and I think soon the rug will be pulled out of everyone who invested in crypto. Worse is how youtube is allowing ads for scam services that promise 'big returns' on obscure crypto coins with shiny "AI" features, which just means the big players are feeling the pressure to get everyone who might buy crypto into the 'market.'
When all the immigrant jobs are forced to pay a few dollars more an hour to get Americans to work there in-lieu of Chik-Fil-A, I expect prices to start edges up at the store; the companies will not absorb those costs at all, and definitely will not raise wages over the broader economy since Americans have proven they will tolerate gouging and higher inflation, with the only consequence being muffled complaining.
No one is buying new cars, and the real estate market is as bloated as ever: a pop to either one will cause an instant recession - or maybe turn this stealth recession into an actual depression. I think automotive will be the first to pop; new cars are not moving, and lots are full of vehicles from 2 years ago that never sold, with most dealers and manufacturers being unwilling to lower prices for pretty much any reason even if it means they go out of business.
I don't know when the real-estate market is going to collapse: we have all been predicting it for a while, but even blackrock doesn't want market prices to collapse so much that their overall portfolio takes a massive value loss. What mechanisms are keeping it all afloat, I can only guess and probably not very well. Combine increased rents, with the higher energy prices you are forecasting, and the tumult from tariffs, unmoving wages, and increasing inflation, and I do not see how more people won't be living in their cars in parking lots.
It is also incredibly concerning that Trump is basically openly attacking the constitution and the rest of the country for Israel and to get rid of immigrants - for right or wrong that is another discussion - and most MAGA are not paying attention or are cheering it on. It makes you wonder if we will even have an election in 2028 because what would stop Trump from refusing to leave office or to run again if he has a veritable army that will support him unwaveringly? After all the obvious lawfare, the questions around 2020, corona, and jan 6th, I do not think MAGA will go quietly, and I think Trump knows he can't just concede without the System trying to formally destroy him when the protections of being the executive are exhausted.
The 'peace' candidate is readying a war with Iran, and we are practically at war with Yemen. MAGA doesn't care at all and have basically tuned out everything that doesn't have anything to do with owning the wokoids or the trade war which they are convinced they are benefitting from. Interesting times, and sadly it seems they are only going to get more interesting.
The notion of a war with China is a fantasy and fundamentally just a way of begging for huge military budgets...It's impossible to fight a high tech country 6,000 miles away, even if our combat military were more than the skeleton force that exists currently...China would sink our navy with missiles and destroy every American ump'sbase in Asia...and China has powerful allies in Russia and Iran...
Low oil prices are a sign of a weak economy, and won't stay low if Trump's hopes of luring major industries back to the US are fulfilled, but new reserves are always more expensive to exploit, and there will be inflation, a lot of it....
"You can have all of the weapons in the world and it doesn't matter if you can't feed your population," said Karen Foster, an associate professor with Dalhousie University who studies food systems and rural communities.
In the wake of U.S. tariffs, N.S. academics call for food to be part of national defence
Thank you, B, for yet another fascinating and informative article. You may be aware that China has recently announced the construction of a successful and highly efficient Thorium reactor - see for example Glen Diesen’s Substack / YouTube video: https://www.youtube.com/watch?v=jN7TV4qpimA. Diesen’s guest claims that, because of the relative abundance and cheapness of Thorium - ‘there is enough, in China alone, to supply the country’s energy needs for 20’000 years.’ On the face of things, it appears that this technology might indeed be a ‘game changer’ - perhaps sufficient to counter the civilizational decline that you have explored in your blog? I wondered if you would like to comment?
I get it that you were simplifying things about trade and tariffs to make a point about uncertainty, but production didn't magically make it's way into China in the 80s and 90s. It was promoted by a number of factors (again, the real story is nuanced and complex).
I think another 2¢ to throw into the mix are the burgeoning use of non tariff barriers, since the late 90s. And I think this deserves a mention because bureaucracy goes hand in glove with the complex regulatory environs, in both the US and EU. We stopped being "capitalists" quite a long time ago; we could go so far as to say the only capitalist sectors are those ahead of the regulatory curve, the "innovative" sectors, until they get bogged down.
This relates to uncertainty because instead of being a system with competition mediated by law (rules) and courts (tribunals), we're now systems of monopolies and elite capture, wealth management and asset inflation.
And so black swans become our salvation, because every government, on either side of the atlantic, is co-opted by default. The use of tariffs just illustrates the impotence of those in charge to tackle the rot. (Like private equity, illegal from the 1930s until the 80s, and for good reason)
Thought I recognised Brian's hand in a section of that essay.
Do you think the 'West' can go back to the post-war level of consumption, along with milk co-ops, simple bottle recycling, and strong unions? And not "Changing your entire kitchen every two years because fashions have changed"?
Or will 'we' continue the current neolib headlong course until we crash and burn dramatically?
The CIA puppets in charge of European countries seem to want the latter. And a catastrophic major war with Russia thrown in for good measure.
It matters more what the global south/global majority/developing nations do, than what 'the West' does. For them, global trade is their hope for a brighter future.
The "implosion" of Western "Democrapy" will be lovely !!!!
The dictatorships of the West will be defending "Democracy" to the last!
So maybe the predicted pole shift will make all this a moot point.
It is highly likely, it will happens, WE just don't know "when" !!!!!!
Trump's tariff policy is incoherent. Unlike China, the US doesn't have an industrial policy. No one knows which sectors are to be protected. Ideologically, an industrial policy may be viewed as "socialist", which might explain their refusal to consider it.
Across-the-board tariffs, without any cost/benefit analysis, is stupid. There is much trade that is mutually beneficial, or beneficial for the US. Curtailing it is shooting yourself in the foot. And by no means are tariffs the only instrument for altering the terms of trade. Quotas and tax policy are alternatives. If the US were serious, those measures would be employed in a coherent manner.
No one is forcing the US at gunpoint to import more than is exported. Countries that run persistent trade deficits obtain goods and services. Trade surplus countries accumulate foreign currency. By definition, there is no avoiding these outcomes. It's a matter of accounting. Whereas the consumption of goods & services is regarded as more beneficial than the accumulation of foreign currencies. China is being virtuous by manufacturing what the world consumes. Yet Trump believes that trade deficits are a rip-off. He may as well believe the moon is made of cottage cheese.
Yes, our current living arrangements are unsustainable from a resource standpoint, but what the Trump regime is doing is evidence of their incompetence. Bad leadership can result in immediate and short term consequences, irrespective of external conditions. The decline of the US is the culmination of decades of corruption and delusional ideological thinking. Other nations have fared better because their policies and leadership were better.
Speak for yourself! I'm going to impose tariffs on all the credit companies that lent me money so I can buy shiny things - that'll teach them to treat me like a mug!!!
Of course, you're right.
In my opinion you can actually stitch together his stealth policy from his prior actions in his first term and what he has done over the course of the tariff war: during the corona-crisis he spent a load of money, with most of it going to the business/oligarch class. Everyone else got a pittance of some checks, which was the right thing to do, but was dwarfed by the amount of money going to the wealthy.
Obviously, as you rightly point out, he has no stated industrial policy and has made no moves to even suggest there is one that is being worked on behind all of the media screaming.
Instead, what I see is two things: using trade policy to try and isolate China and claw back some of our trading partners that China earned over the last decade and a half. You can see this in his cancelling of tariffs on 90 countries but leaving them in place in regards to China.
The second things is a rhyme of what I mentioned during the corona-crisis: these tariffs, and all this 'money' we are getting back, and all the wealth he is trying to claw back is going to the rich. There is a side-benefit of increased domestic hiring and production, though the later is barely perceptible at this moment and will at best be minor, especially as I mentioned in another comment, there is nothing being done to increase wages. If anything wages will stagnate worse than before. Overall, however, the main point seems to be getting money back to the oligarch class, and obviously he isn't going to write that down anywhere MAGA can read it, you have to basically interpret it from his prior behavior and by looking at who materially benefits in the now from disrupting global trade.
"prepare their constituents for a long decline"
Yes, indeed. And this preparation would be a concerted effort to move as many people out of cities as possible. They would create small farms where those ex-urbanites could provide for themselves using the low-energy techniques that are eventually going to be the only techniques possible.
But asking the governments of modern countries to overtly disavow modernity and prepare for the post-modern era is a big ask. No one, not the politicians nor their constituents want to do it. Only a tiny trickle of doomer-preppers are getting ready (in modern countries). I suspect this will never change and that modern industrialized economies will rapidly disintegrate without any real preparation for what comes after.
Fortunately, there are millions of small subsistence farms in the Global South already supporting millions of people in the style to which everyone will need to become accustomed. They were left behind by modernity but are soon to be the vanguard of humanity.
I completely agree with Bloomburg's take that these tariffs are a "dress-rehearsal for a war with China." In fact, as an American, it seems like our political class is so dysfunctional that nominal preparations for war with our geopolitical adversaries is that only thing that keeps oligarchic infighting under control.
The RAND corporation's 2016 paper about gameplanning a potential war with China sheds some light on the current trade situation.
https://www.rand.org/pubs/research_reports/RR1140.html
Like Britain preparing for war with Germany in the early 20th century, our plans for China involve a long-range blockade to choke off international trade. Indeed, this strategy is so obvious that it is reflected in the decades-long planning of both countries, including the Belt and Road Initiative and the various "island chains" of military bases maintained by the United States.
The USA believes it can cause greater economic damage than it will suffer in a war with China, leading to the collapse of Chinese society. (Considering the privations that the Chinese suffered less than a century ago, this seems ridiculous, but whatever.)
However, the USA realizes that imports from Russia and Iran, especially in the form of fossil fuels, would enable China to survive this blockage and possibly outlast the United States. This, I believe, is the primary reason why there has been such an intense effort to forment regime change in Russia and Iran over the past decade.
And now, we're "decoupling" from China so that we can better prepare for the economic shock for then war arrives. Personally, I think that we're so outmatched that our generals would never allow the politicians to start such a suicidal war with China, but perhaps that is me being hopeful.
Fascinating. I have been thinking a lot lately about how the USA generals have been viewing this. The generals running the show have no room to engage in nonsensical ideologies. I have been wondering if the USA may see a coup d'état and a military enforced command based economy take over. Or maybe the USA military leadership is as foolish as the politicians and is gung ho for a direct confrontation with China.
UK, USA, China... who cares?
The thing "we" were all immersed in since birth - was/is based on artificially imposed hierarchies, laws, experts, institutions etc etc. It's all, and always has been, fake.
All the 'progress', all the technology - none of it was a good idea. Who did it benefit, really? What was the point of having machines do things quicker? Who gained from it? Answer: profit, for the owners of the machines (also the owners of the system).
'Civilization' itself is fraudulent.
Understandably, that is very hard for many to accept. But true, nevertheless.
Once such a system was in place, what could "we" do? It's impossible to escape it, for the vast majority.
Where did it all go wrong? Maybe from the accumulation of surplus via agriculture, leading to wealth (and the flip side, poverty) idk.
All the 'good bits' - the healthcare, the pampered existence, the gadgets etc, are completely outweighed by the bad bit: being governed by parasitic psychos.
'Entertainment' and 'leisure' exist to distract the masses from this invisible prison - but just like food, shelter etc, those are things that people evolved to provide for themselves and each other, not things that inhuman, or anti-human, corporations ought to provide.
The only time humans were ever free was when they were responsible for their own fate. In other words, sans governments, nation states, police, courts, schools, hospitals etc etc etc...
When there were no hierarchies to enable/protect the psychopaths.
You mean, for Europeans, before Rome? That's where it all went badly wrong.
"Where did it all go wrong? Maybe from the accumulation of surplus via agriculture, leading to wealth (and the flip side, poverty)"
I'd be more specific: since the advent of *grain* agriculture.
Before grain, no one could accumulate trophic energy for more than a year or so, before it spoiled or rotted. So human social structure — and the damage that it could do — was flat.
Grain was the first food that could be stored for a number of years, leading to hoarding and withholding, social stratification, hierarchy, "power over", rulers, and indeed, money and capitalism, as granary receipts were traded for other goods and services.
About the same time (~7,000 years ago), a hazelnut civilization was thriving in British Columbia. There was long-distance trade, and varieties from all over BC have been found in the focal point, near modern-day Hazelton. It may have lasted thousands of years, longer than most other civilizations.
But hazelnuts go rancid, and can't be stored for very long. Evidence indicates it was a fairly egalitarian civilization, lacking the usual artifacts of wealth and power.
The sooner we descend to a lifestyle where we have to provide our own daily sustenance, the better off the survivors will be.
We lived hundreds of thousands of years before agriculture in small tribes where everyone knew everyone else. There was no accumulation of wealth because we lived in the moment by hunting and gathering. And the "work week" was amazingly short, 15 hours or so allowing for a lot of free time. Life was not idyllic but at least equitable.
Agriculture was a Pandora's Box and once that box was opened there was no going back. It allowed for the worst of us to usurp the growing wealth that was produced. A select few enjoyed the benefits and the rest were subjugated to what was in effect slavery. Later a system was set up to control the masses. Religion and armies were key to this and were effective in keeping control.
How can we undo this clusterfuck? We can't. Agriculture also allowed for the increase in population to the point where we are now using up all of our resources and soon they will be gone. We have been to smart for our own good.
Thanks for another excellent post.
"In their folly they failed to realize that it really doesn’t matter who wins, as resource depletion, climate change, growing wealth inequality, falling living standards, plummeting birth rates, disintegrating societies and the failure of technology and science cannot be stopped by waging wars."
Exactly! It's a race to the bottom.
The graphic of primary trading partners 2000 & 2020 was eye-opening!
I think MAGA will realize some dissatisfaction with Trump once it hits them that wages are not going up; I make decent money in a specialized trade, but overall things are getting worse and worse and basically I am learning another language because unless something good happens - and this in unlikely - I will have to leave the country. Most people are not like me: I am not special by any means, but I have a lot of specialized experience and enough intelligence to do something like learn a foreign language relatively quickly. Most of MAGA can never do this, and probably wouldn't commit to it even if they could.
DC probably has some tricks to keep inflation relatively low for a while, but there is nothing short of raising the federal minimum wage to make wages go up. Companies have learned they can keep paying the same rate for more labor output and there is nothing anyone will do about it. In fact, companies have started to offer training for specialized labor for new people who have no experience at all - even unrelated - because that is 'cheaper' than raising wages.
Once it becomes obvious that the stock-market isn't going to really recover, so boomer MAGA 401ks are shot, I think that will be another blow to Trump. His recent aggression towards the fed might make the libertarians happy, but removing a tumor with brute force that is integrated into your heart and lungs is a stupid idea. Bonds and treasury bills are edging closer up, silver is now somehow moving despite JP Morgan's market manipulation, and I think soon the rug will be pulled out of everyone who invested in crypto. Worse is how youtube is allowing ads for scam services that promise 'big returns' on obscure crypto coins with shiny "AI" features, which just means the big players are feeling the pressure to get everyone who might buy crypto into the 'market.'
When all the immigrant jobs are forced to pay a few dollars more an hour to get Americans to work there in-lieu of Chik-Fil-A, I expect prices to start edges up at the store; the companies will not absorb those costs at all, and definitely will not raise wages over the broader economy since Americans have proven they will tolerate gouging and higher inflation, with the only consequence being muffled complaining.
No one is buying new cars, and the real estate market is as bloated as ever: a pop to either one will cause an instant recession - or maybe turn this stealth recession into an actual depression. I think automotive will be the first to pop; new cars are not moving, and lots are full of vehicles from 2 years ago that never sold, with most dealers and manufacturers being unwilling to lower prices for pretty much any reason even if it means they go out of business.
I don't know when the real-estate market is going to collapse: we have all been predicting it for a while, but even blackrock doesn't want market prices to collapse so much that their overall portfolio takes a massive value loss. What mechanisms are keeping it all afloat, I can only guess and probably not very well. Combine increased rents, with the higher energy prices you are forecasting, and the tumult from tariffs, unmoving wages, and increasing inflation, and I do not see how more people won't be living in their cars in parking lots.
It is also incredibly concerning that Trump is basically openly attacking the constitution and the rest of the country for Israel and to get rid of immigrants - for right or wrong that is another discussion - and most MAGA are not paying attention or are cheering it on. It makes you wonder if we will even have an election in 2028 because what would stop Trump from refusing to leave office or to run again if he has a veritable army that will support him unwaveringly? After all the obvious lawfare, the questions around 2020, corona, and jan 6th, I do not think MAGA will go quietly, and I think Trump knows he can't just concede without the System trying to formally destroy him when the protections of being the executive are exhausted.
The 'peace' candidate is readying a war with Iran, and we are practically at war with Yemen. MAGA doesn't care at all and have basically tuned out everything that doesn't have anything to do with owning the wokoids or the trade war which they are convinced they are benefitting from. Interesting times, and sadly it seems they are only going to get more interesting.
The notion of a war with China is a fantasy and fundamentally just a way of begging for huge military budgets...It's impossible to fight a high tech country 6,000 miles away, even if our combat military were more than the skeleton force that exists currently...China would sink our navy with missiles and destroy every American ump'sbase in Asia...and China has powerful allies in Russia and Iran...
Low oil prices are a sign of a weak economy, and won't stay low if Trump's hopes of luring major industries back to the US are fulfilled, but new reserves are always more expensive to exploit, and there will be inflation, a lot of it....
Some sanity:
"You can have all of the weapons in the world and it doesn't matter if you can't feed your population," said Karen Foster, an associate professor with Dalhousie University who studies food systems and rural communities.
In the wake of U.S. tariffs, N.S. academics call for food to be part of national defence
https://www.cbc.ca/news/canada/nova-scotia/local-food-national-defence-1.7512734
Food-Weapons are part of national-offense since Kissinger whispered in Nixon's ear around 1972, "control the food and you control the people"..
"Get big or get out", quoth Earl Butz, after the decision was made to put all of the small farmers in the world out of business.
Son of a farmer. Learned the wrong lessons.
https://en.wikipedia.org/wiki/Earl_Butz
Farmer-Class-Traitor
;-(
"They are not evil, they just simply do not care."
That's one definition of evil. The banality of evil.
Nate Hagens has done excellent work on this topic.
Thank you, B, for yet another fascinating and informative article. You may be aware that China has recently announced the construction of a successful and highly efficient Thorium reactor - see for example Glen Diesen’s Substack / YouTube video: https://www.youtube.com/watch?v=jN7TV4qpimA. Diesen’s guest claims that, because of the relative abundance and cheapness of Thorium - ‘there is enough, in China alone, to supply the country’s energy needs for 20’000 years.’ On the face of things, it appears that this technology might indeed be a ‘game changer’ - perhaps sufficient to counter the civilizational decline that you have explored in your blog? I wondered if you would like to comment?
I get it that you were simplifying things about trade and tariffs to make a point about uncertainty, but production didn't magically make it's way into China in the 80s and 90s. It was promoted by a number of factors (again, the real story is nuanced and complex).
I think another 2¢ to throw into the mix are the burgeoning use of non tariff barriers, since the late 90s. And I think this deserves a mention because bureaucracy goes hand in glove with the complex regulatory environs, in both the US and EU. We stopped being "capitalists" quite a long time ago; we could go so far as to say the only capitalist sectors are those ahead of the regulatory curve, the "innovative" sectors, until they get bogged down.
This relates to uncertainty because instead of being a system with competition mediated by law (rules) and courts (tribunals), we're now systems of monopolies and elite capture, wealth management and asset inflation.
And so black swans become our salvation, because every government, on either side of the atlantic, is co-opted by default. The use of tariffs just illustrates the impotence of those in charge to tackle the rot. (Like private equity, illegal from the 1930s until the 80s, and for good reason)