The storm around the rapid deterioration of Turkey’s economy sent shock waves across the financial world. In light of the worsening relations between Turkey and the U.S., and as a result of President Trump’s declaration of double caps on steel and aluminum, the European banking and financial system could be dragged into an old-new debt crisis.
“The numerous fronts indicate a dramatic and global collapse of the free international trade market. “
We are witnessing a world war, albeit different from what we have known in the past. It is the modern technological and financial version of war. The numerous fronts indicate a dramatic and global collapse of the free international trade market. The U.S., Europe, China, India, Russia, the IMF, Turkey, Iran, Brazil and other countries are all in the midst of economic battles. Mutual sanctions, currency attacks, and unprecedented threats are flying around the globe, as leaders are fighting for their dignity and throne.
Today we don’t need atomic bombs to cause mass destruction. Cutting off international ties could cause entire populations to starve for food. From day to day, we find it hard to envision a peaceful future in a single country, without taking all others into account. In today’s world, the links and dependencies between countries and economies cannot be untangled without a great deal of conflict.
“China will not be able to continue using its large cash reserves to buy real estate or giant companies around the world, while the technological revolution devalues China’s cheap production lines, which have always been its main economic advantage over the past few decades.”
The international trade market, which has been a free market for decades, is now being practically shut down. Here is the forecast: China will not be able to continue using its large cash reserves to buy real estate or giant companies around the world, while the technological revolution devalues China’s cheap production lines, which have always been its main economic advantage over the past few decades.
As the Chinese expansion in world trade meets a roadblock, the potential benefits will be distributed among other powers such as the U.S., Europe, Brazil and others. Russia, however, finds itself in a pickle, facing stronger and healthier trade partners with a weakened currency that is stifling its economy. And the U.S., in complete contrast to the passive policy that characterized it in recent years, is now determined to take the lead.
Regarding global forecasts, the two countries that appear to have the ability to lead in the global trade war are the U.S. and Israel. Both countries have the distinct technological advantage, entrepreneurship, ingenuity and innovation necessary to generate solid economic results. The battle no longer plays out on mechanical production lines. Today the minds own the battlefield.
“Regarding global forecasts, the two countries that appear to have the ability to lead in the global trade war are the U.S. and Israel.”
The first act of this war should reach its peak in October. Turkey’s huge loan repayments are nearing insolvency. Then, the Turkish Republic will be forced to either take dramatic measures such as debt relief or take very expensive loans from countries and financial institutions. Could Trump announce victory? Will Israel prosper as a result? Will world markets spiral into another economic crisis?
In a globally interdependent world, a single winner does not exist. Countries and economies are tied together in an integrated system, which they cannot disengage from. This interdependence – which most players still seem to ignore – means that a zero-sum where the winner takes all cannot happen. Ultimately, we will realize that we can all win together or lose together. A third option is not on the table.
