The march to an inevitable North American world hegemony is ...... picking up pace. - A lot, lately!
TLTR
The war in the Ukraine was essentially over the day it began. Now, with western interests notably starting to fade, it will start to make it's way to the back pages of daily reportage.
Why was this even an issue of US interests, to begin with? ...
Washington had this far fetched dream - although, not entirely without historical bases - to create a Polish-Ukrainian-Lithuanian superstate , entirely funded on US interests, unifying over 80 million people, populating 5 million square kilometers, right up against the Russian Federation and China's western sphere of interests. Nice try!
The real problem with this wishful thinking is multi-fold.
While those above mentioned peoples do have a lot of similarities in culture, language and historically undesirable (for them) outcomes, the facts remain the same;
- Ukrainians do not play well with others! Notably one of the most chauvinist cultures, their mistreatment of minorities is (or should be!) rapidly becoming legendary, the largest of which are the Poles;
- "My enemy's (i.e. Russia) enemy is my friend." - As incredibly profound as that may sound, it also makes for extremely unstable, impossible to maintain alliances;
- The Organization of Turkic States (Azerbaijan, Kazakhstan, Uzbekistan, Kyrgyzstan, Turkmenistan, Turkey) do have a lot to say about this and, not surprisingly, they do not approve - to say the least;
- Then there is Turkey (a regional super power) which, not in the least, together with China, had managed nothing less than to broker a piece between Iran and Saudi Arabia;
In summary, a now defacto Russian-Chinese-Iranian-Turkish coalition is enough to make even the United States to stop and think twice what it's wisest next step may be, in the region. OK, so no big deal. The US blew ~7% of it's annual defense budget on this still-born idea but, since it can, will likely call it a day , in the very near future.
The EU , which is essentially nothing more than a German franchise, is looking at it's End of Days . The German industrial base managed to go 0-3, much like on the two previous occasions when they fielded their dream team , an outcome that is all but inevitable. Any doubt?! ...
Just this week Volkswagen and BASF both announced that they are "considering to explore their North American options with regard to future investments". That is the German Industrial Base ! - Apparently looking to seek asylum in the US.
German infrastructure and industry, which took over 30 years to build, only took two(2) short years to gut and to irreversibly break apart. No shock, there.
Germans always had to be the best at whatever was the vogue of the day and clearly, self-mutilation and ultimately, economic suicide, not being an exception.
(I spent a lot of time in Germany and to get a Wifi signal - cellular or otherwise -, the quality and frequency is right up there with Lebanon's. German pensioners blow their retirements on turtle neck sweaters because state sanctioned energy cut-backs simply turn off their central heating in the middle of January. The fastest growing manufacturing sector, as of right now, is wood-burning stoves! - The effect of which on the lumber industry is interesting, in itself but that's a whole other conversation.)
Germany's largest trading partner is China! (40% of exports.) Chine is notably not found of the present, vigorous German ra-ra which would have the average mainstream news consumer believe that Kiev has won the war last christmas and that right now, Polish troops are storming the walls of the Kremlin, under German leadership.
E.g. China, ultimately, does have an awful lot of pull in the case of German foreign policy and, lately, Beijing's patience appears to be wearing thin.
Long story short; "It's been nice signing with you Coco, but it's over!" - Bet on it!
China is dying! (Present tense.)
As stated previously, the inescapable reality of a demographic collapse - it's first, truly major wave - is descending on China at the time of this writing.
A total of 1/2 (50%) of China's population will not celebrate New Years Eve, 2035! - Leaving about 800 Million de-industrialized, de-urbanized, subsistence farmers in it's wake, by the middle of the next decade. As rapid extinctions go, this one is for the books. (As a personal reflection perhaps of mild interest, I have spent some time in the Mekong Delta, planting rice - just to see what it's all about. Afterwards I can safely state that there is no more expensive crop or an other, more soul-sucking, endlessly laborious occupation than rice farming! As for automation? ... What automation?! - It will never happen! To grow rice is a 24/7, all out battle with Nature, which uses up every living thing - including people and the environment - in a merciless fashion. I, personally, would much rather go back to pyramid building, as one of the slaves. My point being; Can anyone imagine china without rice? - )
In short, if there ever was a sure thing , this is it! (Feel free to do the rest of the math - i.e. a world without China.)
Now, having argued why "everyone dies, except for the USA" , that, of course, is not the same as all of them will walk off into the sunset with a whimper . (Although, under the circumstances, even that isn't very far fetched.) Who will be able to muster at least a last, dying spasm, is yet to be seen but if it happens it will be violent! Be prepared!
"Crises take much longer to unfold and run much deeper than anyone would expect."
All that is outlined above is already happening (no more "unfolding" ) and perhaps with traders' typically myopic view, a lot that is about to hit the fan could seem "unexpected", at that moment. Don't be caught off guard! Trade it with the lay-of-the-land in mind and make the most of what promises to be a once in many-generation opportunity.
EUR/USD Short Bias (from here on out, essentially for ever );
USD/CNH Long Bias (from here on out, essentially for ever );
US Equities & Treasuries over any off-shore, Bias
p.s. The US of A still maintains marginally beneficial demographics, with no near term dangers on the horizon. On the top of that, it also boast one of the few optimally dispersed populations - from a systemic point of view. E.g. "Globalization", in reality, is just a less pointed pseudonym for US world hegemony.
