…incoherent piece of text but interesting nevertheless…
Fully in line with the “hip” wave of economic disaster that is striking the world at the moment, Russia has seen a huge part of its exchange value evaporate over the weekend. The same thing has happened to the USA in the past few weeks. At last, these two cold-war adversaries find each other, be it in the same misery.
By blowing ever more air into its over-inflated credit bubble, the USA screwed up big time. The collapse of the housing market and the slow sinking of some huge banks and insurance companies demand elaborate monetary rescue missions. These will be at the tax payers cost, of course. Slowly but surely, the US economy is coming to a grinding halt. It’s Recession Time!
Russia, on the other hand, is paying the price for being a rogue agent on the world stage: they have no rule of law to protect ownership inside their own country. They are also compelled, in one way or the other, to get involved into regional conflicts, and they suffer from a steadily deteriorating democracy.
For me, it is comforting to see the Big Boys, who always were the world’s bullies as I grew up, topple over like castles made of sand in the upcoming surf. People from my generation expected them to be nuclear liabilities forever. But times have changed and other players reign the economic playing field. The Middle East and Asia are taking over, thus ending the hegemony of the West.
Europe still seems to be in the slipstream of the development of this crisis, but not for long. Maybe that is why I don’t see the emerging powers as “enemies” yet. And even when we will be overtaken by the Saudis – or Chinese – with their big wallets, who cares where the money that saves us comes from? It’s hardly possible to have dosh that’s dirtier than what we have been used to.
I was having a chat with one of the students of the university here yesterday. He was showing off his H2 car – with enormous Shell company logo – to the public. After some exchange of easy-going remarks about the world energy crisis, girls, and the future of oil exploitation, he said something very interesting:
“The Sheiks, Sultans and Caliphs are already planning their switch to an alternatively based economy. The Shell Company is doing the same thing. They expect to make the switch within 50 years. The Middle East is investing heavily in alternative energy, and if there is one thing you can leave to those people, then it is spending money.”
And indeed they are. As far as I know, the largest money reserve is in the Middle East at the moment, and they are letting it roll. One of the side-effects of this fact is that the USA has almost sold out its entire stock of companies, and some of these are even in the strategic sector. This really says something. Since the dollar doesn’t cut it as a real big-people currency any more, and foreign investors want to ditch their American dollars, they are now buying American companies instead. Their investments are turned into real tangible substance, as opposed to the huge pools of increasingly risky dollars they used to have in their back pockets.
Analysts see the point of global economic and financial gravity shifting towards the east. As I understand it, our European days as powerful global economic leaders are almost over. This will force us to change, and to development innovations, and eventually to progress swifter. I think that we will benefit from this economic crisis eventually, just like the junkie who benefits from a cold-turkey heroin come-down.
I hope one thing though, and that is that we will have a softer landing than the USA are currently making. I am counting on the common sense of our bankers, but there is no guaranty at all. We are driving in the mist and we can only see some faint tail lights of the cars leading us, but we are clueless as to where we are going. Maybe the landing will be a brick wall…?
