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I enjoy following news events and all of that geopolitical stuff... and over the years, I have been following and trying to understand how things work behind the scenes in the wider financial and economic spheres as well. It is equal parts interesting, bewildering, and somewhat unnerving.... but it all seems to hold together and work... in a way. I guess it is the sort of house of cards sort of thing that works until it doesn't work... and when it doesn't work, well... then you start to see which parts of society are "more equal" than others.

So... I guess it is no real surprise that over the decades... the infection of "free market, small government" has spread through mostly through the Western Anglosphere... and on the surface, it is an enticing philosophy, where we think that market forces will fix most things, and that government should just get out of the way and allow things to be done.

... except, what actually has happened, is that the capture of the governments and regulatory bodies by corporate and multinational interests means that we are not exactly living out the dream of an ideal free market... but we are instead living out the dystopian nightmare of weak regulators, unchallenged domination of special interests, and the era of "too big to fail".

... and if there needs to be corrections, then some part of society will have to feel the pain. And lets not kid ourselves, the upper end and the "too big to fail" crowd are going to make sure that they aren't feeling any pain... or if they want to create the appearance of solidarity, they will give up a little scrap of crumbs... in exchange for allowing the rest of the society bear the burden for their greed.

So, with that in mind, we are in a period of high inflation... which the central banks can use higher interest rates (actually, that is the only tool for them...)... which would be fine... except, that many nation states are running high debts... and a higher interest rate will mean that those debt repayments will balloon out of control.

That would mean that either government spending will have to decrease (not the corporate welfare... but stuff like education, infrastructure, and health....)... or taxes will need to rise. And the public have been indoctrinated into thinking that both of these are bad... and any government that enacts either will be slaughtered at the ballot box by an opposition that is hell-bent on gaining power instead of trying to work out something that won't bring the country down in a pile of IOUs.

In either case, both options are going to be terrible for most people. If interest rates don't rise... then you have rampant inflation that can't be checked (which is good for debt, as that will evaporate away...)... and if interest rates DO rise, then we are likely to go into a heavy recession!

Needless to say, most of the corporate class and the extremely wealthy... who have essentially put us in this mess due to their own greed and disdain for the effects of their actions on the rest of society and the world... well, they will be fine as they will have hard assets like property and all of that sit on. Plus, they will be well sheilded from inflation as their asset worth will inflate as well, which means that they can always borrow against that higher number.

Sadly... if you progress further down the pecking order... you will find that people are going to suffer... in different amounts, depending on their exposure to whichever ill-economy is heading our way. Some are going to be more exposed to higher interest rates... and others by higher inflation... and most will be hit hard by both.

It really does feel (and I really hope that I'm wrong...), that we are headed for a terrible and difficult decade as a society... one where I think that we will really start to see that our "betters" have decided to leave the rest of society behind whilst collecting the lion's share of worldwide assets/wealth. Of course, I don't think that the rest of society are going to take kindly to that... and we could well have a bit of a ruckus about that. And that is just WITHIN developed countries... throw the existing geopolitical and worldwide tensions into the mix... and well, it might just be a good time to have a decade long snooze.

Anyway... it appears that the path ahead is to bunker up and be defensive. Reduce expenses, grow "tangible" hard assets (from food production through to BTC/ETH)... and expect the worst. Something just feels very very wrong... and not in a good opportunity sort of way!

I can also be found cross-posting at:
Hive
Steem
Publish0x

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