October 12, 2016

9 Reasons the World is Close to Catastrophe

I can think of 9 major trends or events that are occurring at the same time and together have the potential to send the world into a very dark place:
  1. Tensions with Russia are rising. For very different reasons, both Presidential candidates can only worsen our position in Russia's eyes.
  2. The 2016 Presidential election seems like it will end in a rise in fascism no matter who wins. We may be witnessing the destruction of the American democratic experiment. Already, America is becoming increasingly divided and suspicious.
  3. North Korea is committed to building nuclear missiles that could reach mainland America. North Korea has an unpredictable leader that, for years, has threatened to destroy the United States. This may be possible within a couple years.
  4. Many cities around the world (e.g. Vancouver, Toronto, Sydney) are experiencing a colossal housing bubble. The collapse of this bubble will bring unfathomable economic pain to both the financial and real economy.
  5. The economy has grown for 7 years straight - we are overdue for a recession.
  6. The stock market has also risen for 7 years. We are approaching the due date for a major market adjustment.
  7. Central banks and governments around the world have failed to generate much middle-class prosperity or real growth for many years. The world is today in new territory - never in 5000 years of history has the world experimented with negative yields. It is likely that central banks and governments will continue to fail for years. So will the middle-class lifestyle and demographic segment continue to disappear?
  8. We are at or near the end of the 40 year decline in interest rates that boosted all asset prices and wealth. What happens next? And how long does it last?
  9. Global warming appears out of control and rapidly changing our climate. The humanitarian crisis will only lead to a geopolitical one of worse proportions.
While some of these issues may have existed individually in the past, I don't believe the world has ever experienced a convergence of this magnitude. I really feel like the world is precipitously close to major insurrection and possibly another World War.