US-China Trade Scuffle Will Kick Off the Great Meltdown

The be-Muellered, bothered, and bewildered American public may find US-China trade talks about as interesting as a rain delay in an Orioles-Chisox game, but the Friday collapse of negotiations may be marked by historians as the day that the global economy died. The Big Box blue-light-special orgy of bargain shopping ran about thirty years, with China exuberantly pumping out cheap consumer goods to feed the US beast-of-Mammon. Americans happily payed for it all with IOUs based on long daisy chains of previous IOUs. Tom Friedman of The New York Times said it would last forever. Alas….

The paradigm kicked off for one simple reason: energy flows dictated capital flows. By the mid-1980s, the non-OPEC world was once again swimming in oil from the last great bonanzas of the oil age: The Alaska North Slope and the North Sea. Twenty years later, they were running down. Meanwhile, the USA had fecklessly “offshored” its factories in the mistaken belief that we had entered a shimmering new digital economy of virtual business were nobody had to make real stuff. China became the world’s workshop and the USA became the world’s financial bucket-shop, churning out endless swindles and frauds. The predictable result was the financial crisis of 2008, which coincided with oil prices rising to over $140-a-barrel (and six months later they crashed, with the economy, to under $30-a-barrel).

The “recovery” from that was based on Wall Street’s premier swindle: the shale oil “miracle,” based on high-risk lending to companies that couldn’t make a red cent even while accomplishing the majestic stunt of exceeding America’s old 1970 oil production peak of around 10 million barrels-a-day (now at around 12 million). Notice, too, that the final push to 12-million barrels occurred during the last two years: thus, Mr. Trump’s miracle economy. All that, to paraphrase the immortal words of Mr. Dylan, balances like a mattress on a bottle of wine.

The China-US trade impasse, if it stands for even a few months, will crash the US economy again and it will also crash the price of shale oil back to levels that destroy oil companies. You understand, of course, that the rise of shale oil was amazingly swift, ten years, and that its fall will be similarly fast and furious. The feds may have to either bail it out or nationalize the whole shootin’ match — and that will end up as just another rat-hole we pound sand into, along with our long-running campaign to build failed states overseas. Translation: not so good for the value of the US dollar.

We’re moving into a summer of grave discontent. I don’t believe that China-US trade relationship can be repaired. The disturbances we have set in motion will surely unleash the wicked animus against the USA that has been building among other nations since before 9/11/01. Even the Europeans, our old pals, have soured on us. The war hawks are steering our ship-of-state into reefy waters. The dithering Federal Reserve (America’s central bank) has painted itself into a corner with years of interest rate suppression and market manipulations. Bad weather in the American breadbasket portends rising food prices for us, and less to export (or give away) to the really hungry corners of the world. Less food makes for belligerent nations.

There is already enough tension in the world as it faces not just the end of a global trade fiesta, but a world-wide synchronized economic depression. This is the one from which there will be no “recovery” but only adaptation to lower standards of living and new arrangements for getting by. In other words, the contraction will be permanent […]

via US-China Trade Scuffle Will Kick Off the Great Meltdown — © blogfactory

2 thoughts on “US-China Trade Scuffle Will Kick Off the Great Meltdown

  1. Kunstler had a hip replacement with a bad metal hip ball, that gave him syetemic, heavy metal poisoning. Happened about 5 years ago. It also caused heart toxicity. He had a bypass and then another open-heart surgery that ended up being a triple-bypass to correct the other one. All in all, I think he has lost about 60 IQ points. He repeats the same boring memes, over and over again. Same lame plays on words, idendity-politic memes(that he claims to detest so much) and hyperbole.
    He has repeated the transexuals selling nabisco a thousand times in the past 5 years. He has hammered the peak oil meme, for 40 years and never been right.
    Now demented donny is his hero.. Two birds of a feather.
    Mr. Know-It-All.
    Fukushima denialilist.
    Maybe things will come down hard. It will be because of Trump.
    Kunstler is a zionist jew. There will be no place to Hide Silly Jimmy when a nuke war starts or a few reactors go off Fukushima Style, Here.

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  2. KUNTSLER is a cheerleader for preppers. The United states will crash soon, as the Soviet Union did.
    The Soviet Union was crashing, about the time Chernobyl occured.

    There arw 99 old reactors in America, that are beyond repair.
    Trump has gone out his way, to make sure to deregulate all supervision of these old Fukushimas-in waiting, Trump and Perry are hungrily importing high level nuclear waste to be parked in America in a
    hoddy containment.
    Trump and Perry have effevtively, ended supervsion of the Highlevel radionuclide waste by reactors and the atuff being dangerously, parked ouside in Idaho, California, Texas, New Mexico, Washingto and by many nuclear reactors in America.

    There is significantly worse weather and more geological instability in the US now, than there was 20 years ago.

    THE Ukraine, no matter what you hear, will never recover from Chernobyl. There was, a significant high level nuclear waste, disaster in Ukraine 4 yeras ago. Thw accident has gone unreported.

    Thw Ukraine has 17 old reactors, on the verge of melt-downs at any time. Japan is just Ruined, no hope in sight. The Japanese continue to open damaged reactors.

    About the time americas economy fails, 2 or three nuclear reactors and highlevel waste sites will go. America will be no prepper paradise. America will be dead man and woman-walking scenario, of radioactive hell. Eevryone will wish they were dead.

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