Thought for
the day
“Every choice you make has an end result.”
-
Zig
Ziglar (American, 1926)
Word of the
day
Mishpocha (n)
An entire family network comprising relatives by blood and
marriage and sometimes including close friends; clan.
(Source: Dictionary.com)
Shri Nārada Uvāca
If “Dynasty” is good
for Doctors, Lawyers, CAs, Civil Servants, Actors, Singers, Musicians, Painters,
Authors, Soldiers, Farmers, Goldsmiths, Business Owners and Managers, et. al. –
then why not for politicians?
Fathoming the unfathomable
Earlier this month, we expressed our view that the latest debt deal
by US politicians has created a breeding ground for black swans. We shall see
them flocking the horizon in next 12-15months.
We received tremendous response to our view. While most
readers focused on next couple of years, some of them provoked us to think
little longer.
Based on exchange of communication with our readers during
past one week, we could list the following eventualities which are not
completely unfathomable at this point in time, but may still be considered
black swan on occurrence as very few would be willing to bet money on these
events in next few years.
(a)
European Union disintegrates. The move may begin
by non-Euro participants like UK and exacerbate on weaker economy choosing to
have their own money printing power to handle their fiscal mess.
(b)
Global investors’ patience with US politicians
runs it complete course. Repeated episode of debt ceiling, shut down and dithering
on a firm monetary policy stance could lead to substantial erosion in “safe
haven” status of USD and US treasuries.
(c)
USD declines without a proper succession plan in
place. With no fiat alternative in place, the world is forced to adopt gold
standard after a chaotic year in the global financial system and market place.
(d)
Withdrawal of the US forces from Middle East
leads to a mayhem. As disparate forces rush to take control of regions mineral
resources and strategic posts, serious supply disruption occur in global energy
market.
(e)
The imbalances in the internal economy of the US
grow beyond control leading to eruption of a civil war leading to renewed
aggression for secession by resource rich states.
(f)
Germany attempts to take control of indebted
smaller European nations to safeguard his financial interest and in the process
create a strategic alliance (as opposed to mere financial) of European nations.
This leads to emergence of multiple poles in a largely unipolar world. Rise in
Sino-Japan rivalry may provide further impetus to polarization. This could
eventually lead to end of the era of peace that has existed post WWII. Given
the demographic changes since WWII, EU and Japan could be major losers in the
process.
(g)
The commodity super cycle ends abruptly led by
hard landing in China and stalled growth in other emerging markets. This leads
chaos in commodity driven markets like Australia, Russia, Brazil etc. causing a
global recession.
(h)
Unlimited QE eventually fails in pulling out the
world out of prolonged slow down and the world slips into recession – the
deepest and worst ever.
It is important to
clarify that these are not our views and we assign Nil probability to most of
these outcome.
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