the world is going to look very different and there's a lot of things in the wider
world to be very concerned about i i am concerned about a number of countries simply decivilizing
when they lose access to the inputs of a modern world that means a breakdown in regression
that's unavoidable i'm specifically really concerned about the agricultural question
because the carrying capacity of everyone's lands without agriculture i'm sorry without fertilizer
you're talking about it dropping by half so we're going to lose
hundreds of millions of people maybe even a billion in the better case scenarios but
based on where you are that might not apply in the case of the united states you've got a stable
consumption system a reasonably robust labor system no security thrusts energy self-sufficient
food self-sufficient and an educational system that hasn't worked great for the last 20 years
but is actually really well geared to training up the next round of manufacturing workers
so all the elements that you need for revitalized america are already here all you need is a shock
elsewhere to underline the fact that things need to move kovid did that trump did that biden's
doing that the ukraine war is doing that coveted china is doing that everything is moving in the
direction it needs to in the united states we will emerge from this in a much better position just
that the road from here to there is not a straight line what countries are you most concerned about
top of the list uh you've got over a billion people that simply
cannot be fed with the land's quality and with the inputs that are going to be available
it is by far the country that is going to suffer the most other countries that are
dependent upon international interactions for trade and for capital i'd say korea and germany
are at the top of that list for slightly different reasons i don't see how the germans make this work
their supply chains are dependent on a half a dozen countries and as long as the germans are
turning a blind eye to ukraine those half a dozen countries are really mad but if the germans start
acting like everyone says that they want to and they want the germans to rearm and put troops
in poland to fight the russians we've seen this movie before i don't see a good path out of this
for germany that is positive it's a big challenge for europe to hold together in this environment
before you even consider the fact that we now have a war on europe's doorstep and they're
starting to squabble squabble over who gets what energy from what source next year is going to be
very trying for the europeans as all of these trends come to a head you know if you had asked
me this question before february 22nd of the war started i would have said blindly that of course
the euro is going to disintegrate because it was a political project not an economic
one they've got all these differences you know there's clash currents and it just can't work
but then the russia war the ukraine war happened and the europeans are actually
more united at this point than at any time since the treaty of westphalia in the 1600s
this has been a pleasant surprise to me and you know since it is since the euro is a
political project the europeans choose to pay for that and right now they are choosing to be
united and that generates a lot of hope on the political side that just wasn't there before
and in europe in any society where demographics are aging and old and the normal rules of
economics break down it's all about political choices and for now they're choosing to matter
choices can make things better or worse so great example of course with the ukraine war is the
united states ukraine is not a nato ally but we saw an opportunity to destroy the country that has
been pointing nuclear weapons at us for 75 years and we're taking it that's a choice it's not free
it will generate more heartburn down the road no matter how it turns out but we are no longer
in the globalization era where it's all about economies of scale and economic efficiency that
world was going to go away without any of these conflicts the conflicts are just speeding things
up and now we have countries making choices that are specifically not based on economic rationale
that can go well that can go horrible right now the ukraine war still up in the air anything that
is a dangly supply line that requires dozens of participants in multiple continents that's just
going to stop and so if that's an industry you care about you need to look at how countries
are resourcing product production to their own localities we're probably going to have a series
of regional trading systems with very little interconnection between them you'll probably
have a french-centric one in western europe you'll probably have a turkey-centric one in the middle
east and southeast europe you'll probably have the japanese reaching out to a whole lot of folks
but because of their demographics they're going to do it with trade and money instead of warships
this is a good thing and then of course the western hemisphere is kind of its own thing
is there as we're thinking about this so it's interesting to me that you sort of point out japan
as a winner because they are have been dealing with an aging population that time bomb for so
long you know they've run up huge debt trying to support it they've been stuck in this deflationary
environment but but it sounds like you think they come out as a winner there are definitely let's
call it a relative winner uh a couple things to keep in mind about japan uh number one they've
got the world's second most powerful navy so they have a capacity to reach out in a way that very
few countries can really only half a dozen second you're absolutely right this is the first country
to go through that demographic transition for them it started in the 80s and it's well past
the point of no return but it's gabon at such a slow rate and the japanese have been able to adapt
their policies to it one of the reasons that we all think of japan as an automated robotic place
is because this is a conscious choice as they deal with fewer and fewer workers and consumers they've
had to automate now they've done this under the aegis of the american-led globalized system
and that has allowed them to do things over 30 years that other countries are gonna have to do
over like five and they realize that they can no longer be a power unto themselves
so two things come from that number one they have a program that's basically build where you
sell and they use foreign investment to go into countries with healthier demographics and
construct their products there that's basically the whole model for toyota in texas i was going to
say the south the southeast in the us absolutely very successful second is that they've realized
that they can't do this by themselves and so they've made the conscious strategic choice
for permanent long-term alignment with the united states and they did that successfully
when trump was president they are the only country in the world that has been able to get well along
well with both trump and with biden they basically bought their way in and it's working for them does
it matter who's president in the u.s when you're talking about the the trends that we've discussed
over the course no matter if the trend flipped on our road from bill clinton to w bush to obama
to trump to biden we've become more and more economically nationalist and if that were to
change it would matter but i don't think the american population at the moment is interested
in engaging in the rest with the rest of the world economically i just don't think that's even
in the cards and i think apple's decision to start pulling out of china is kind of the quintessential
example because they were always the furthest the most extreme when it comes to doubling down on the
east asian system has the balance of power shifted from slash shareholders to workers oh that's a
good one i think we're seeing some of that part of that is environmental and social governance shifts
which do give the workers a bigger say and do give consumers a bigger say but the core issue is going
to be demographic we are in the middle of a worker bust between the boomers retiring large generation
and the zoomers entering the workforce small generation we're currently at a gap of about
400 000 shortage workers or a shortage of 400 000 workers per year you would think that would
give a lot more negotiating power to workers the only reason i don't want to underline that
i'm not quite sure it's because we are coming out of covid and everything has yet to settle
but the mechanics certainly suggest that that is going to be the trend for the next few years
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