China-China-China

Here we go and what can we say about Covid except utterly and absolutely unexpected disastrous disruptions. The biggest question is whether or not politicians and leaders can stop the eventual outcome of the general public’s discontent over the changes to our everyday lives.

Do we head for another Great Depression, as our economy is affected the global economic instability? The idea of working habits changing and consumers shopping to on-line, or commercial spaces being empty we start to see more and more employees working from home.

We are experiencing mass changes stemmed from consumer demand, financial anxiety and misguided government policies. Remember the recovery from the Great Depression was spurred largely by the abandonment of the gold standard and the monetary expansion, and it’s hard to believe but true. A telltale sign of how governments print money to save their souls, and when the global gold supply used to hold government overspending and inflation in check.

But who cares until it’s too late, the USA effectively abandoned the gold standard in 1933, and completely severed the link between the dollar and gold in 1971 with President Nixon. The new standard is FIAT, currencies backed by governments and we are now relying of paper money, I mean plastic money with mounting debt.

The first symptoms of a crash is a stock market bubble which was the telltale sign during the roaring 1920’s. Those wise investors started taking profits in the summer of 1929 and by October the stock market crashed and wiped out savings for millions of people. Then on top of it a worsening unemployment rate, rising inflation and declining value of real estate as debts rose.

Then came the Dust Bowl, a natural disaster that devastated the Midwest, it was the worst drought in North America in centuries years, does the pattern start to sound familiar? The farmers with unsustainable farming practices worsened the drought’s effect, killing the crops that kept the soil in place. And when winds blew, they raised enormous clouds of dust that deposited dirt on everything, even covering houses. Dust suffocated livestock and caused pneumonia in children and the storm blew dust over Washington, DC.

The weather patterns shifted over the Atlantic and Pacific oceans, the Pacific grew cooler than normal and the Atlantic warmer. The combination weakened and changed the direction of the jet stream. That air current carries moisture from the Gulf of Mexico up toward the Great Plains. It then dumps rain when it reaches the Rockies. This combination also creates tornadoes as the jet stream moved south, the rain never reached the Great Plains. Tall prairie grass once protected the topsoil of the Midwest. Once farmers settled the prairies, they plowed over 5.2 million acres of the deep-rooted grass. Years of over-cultivation meant the soil lost its richness. When the drought killed off the crops, high winds blew away the remaining topsoil. Parts of the Midwest still have not recovered. As the dust storms grew, they intensified the drought. The airborne dust particles reflected some sunlight back into space before it could reach the earth. As a result, the land cooled. As temperatures dropped, so did the amount of evaporation. The clouds never received enough moisture to create rain. (source internet)

This sounds pretty depressing but many of the 1930’s Great Depression signals are parallel with the current situation, so will the economy come to a sudden crash? Based on a series of events we could have a similar snowball effect; a downturn in the economy while governments and leaders would not be able to bail out the masses of companies going bankrupt and unmanageable unemployment.

The effects of the Great Depression devastated America for 10 years and people watched housing prices fell 70% and GDP fell 30% and bankruptcies were rampant with unemployment at 25%. Government spending for FY 2021 budget is $4.829 trillion and imagine when people start to realize governments cannot print and save forever. There is is a possibility and an eventual outcome of a global monetary crash, consumers confidence vanishes and war looms.

So the $99 question is, do we see a successful sequestration by economists to curb government spending, as deficit spending increases with the government’s effort to continually boost economic growth. Remember, two-thirds of federal expenses must go to mandatory programs such as Social Security, Medicare, and Medicaid and military spending rises above $800-billion.

The United States must pay the interest or risk defaulting on its issued debt instruments or risk shaking investors’ faith. But what worries me more than anything is Trump, and if he would win, we have to expect the Government harassing the Chinese on their US Treasury Bills because 1-Trillion and more is owned by China.

Many would think Trump wouldn’t risk the damages, and the shear notion of it is scary but China is slowly but surely dumping the US debt, and this is an added factor to complicate global economies.

And never underestimate China, they continue to buy and own a multitude of global gateways across the globe, with a focus in Europe and in Africa they are dominating the economic scene reaching for resources and grabbing water, minerals and energy.

https://www.aiddata.org/china-project-locations

China roars on and continues to popularize their global support via investing in infrastructure while America is fighting over Presidential leadership, internal discords of racism and the usage of face masks. It is communism’s discipline which makes the difference, dictaors manage people who comply with leadership, and trying to restrain China is a little too late.

So will the eventual winner of this economic race be China as they restructure global economies, and ask yourself when will the South Sea of China become a heated war zone. We face a new type of war with cyber attacks, nuclear submarines, stealth drones all mixed up with crazy North Korea.

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