ECONOMIC RIP TIDE – THREE PREDICTORS
According to the theory of Internal Relations, all events in the Universe are connected. The famous example of the butterfly in China beating his wings and causing a hurricane in the Caribbean stands untouched by criticism.
As feeble minded observers, all we can do is look for apparently logical predictors of the future, hoping that our guesses coincide with the patterns of the present.
FIRST PREDICTOR: SWINE FLU & GLOBAL TRAVEL
The number of cases of Swine Flu appearing on the planet is growing impressively and geometrically. Where the population density is very high, the numbers are jumping. In Japan, where people are clustered and crowded in geographically small cities such as Tokyo, Kyoto and Osaka, the outbreaks are now running into the hundreds. Because their population is so vulnerable to this pandemic, the Japanese Government is patrolling airports, looking for potentially infected travelers.
There are few countries left on the globe that have been spared. As the number of cases increase, the future numbers of cases will increase, because fundamentally, this is a numbers game. The more billiard balls moving on the billiard table the more chance hits will occur.
As yet, the virulence or deadliness of the virus has not increased. Again, this is a numbers game. The greater the virus population, the greater the chance of mutation to a more virulent or attenuated form. Hopefully, the new mutation will be attenuated, but we must be ready for a more virulent form. The population of the world is seven billion. During the pandemic of 1918 it was less than two billion. More numbers means more casualties as any military officer can tell you.
WHAT WILL BE AFFECTED?
If this pandemic grows, as it appears to be doing, three industries will be hit in a primary sense: Travel, Tourism and Hospitality.
Airlines, Cruise Lines, Bus Lines and Car Rental Agencies will see impressively lower volumes of customers as a frightened public decides to avoid crowds by staying home.
Travel, during a viral pandemic is a dangerous undertaking. Passing through crowded airports, sitting in crowded planes, entering into crowded hotels increases one’s exposure to viral infection. If the infectivity, its ability to infect with a lower number of viruses, increases then the chance of surviving a trip without getting sick becomes less.
The Tourism and Hospitality Industries, now a major part of the economies of most poor countries, especially island states, has already been hit severely. The Economic Disaster followed by the Swine Flu has reduced employment in the Caribbean Islands, Hawaii and even Macau on the Asian Continent. More Swine Flu more destruction of jobs.
SECOND PREDICTOR: JAPAN & GLOBAL TRADE
Japan is the quintessence of an export economy. One hundred and thirty million people crowded into mountainous islands in the Pacific, with no raw materials or sources of food or energy, have devised a means of survival: Export!
The Japanese, as a people, are highly intelligent, motivated, diligent and super self controlled. They know that for them to survive on their craggy islands they must produce what others cannot. Their cars, their electronic products, their pharmaceutical products are the best in the world. Toyota has become the piece de resistance for the world automotive industry. No matter where you travel in the world, like Coca Cola, you will find Toyotas cherished by their owners.
The Japanese have been successful in exporting. But, the Economic Disaster has struck Japan harder than other countries. Its GDP fell 14% in the last quarter! Extrapolate for a full year and one gets a drop of over 50% of their GDP per annum.
Global Trade has taken a big hit in this Economic Disaster. People are no longer thinking in terms of luxurious vehicles or top quality electronic toys. Sony, Toyota, and Honda are all sliding down the slope of a frightened consumer population.
Germany, with its list of high quality exporters, has also taken the hit. Their exports are falling and so is their GDP. There are no hard areas in Global Trade except in the areas of survival: Energy, Raw Materials and Food. People are in a survival mode. They have never seen an economic crash of the present magnitude.
Which leads us to our next predictor:
THIRD PREDICTOR: GOLD & GLOBAL ANXIETY
One year ago, in 2008, gold was trading around eight hundred U.S. dollars per ounce. Today it is trading over nine hundred dollars per ounce with a trend line leading steeply upwards. That is a sharp rise in price when all other investments have fallen steeply.
Gold is the thermometer of global anxiety. When a patient is ill we immediately take his temperature to determine if a fever is present. If a fever is present we know that some form of infection or inflammation is also present. If gold is rising in price, the World Mind is anxious. Gold is only a metal. You may like its appearance and want it for jewelry, but if you want it for an investment, you are worried about the future.
There are many abnormally abnormal events occurring in the world this year. Apart from this collapse in the world economy, apart from a viral pandemic, apart from the fact that the planet is getting hotter and drier, apart from the proliferation of atomic weapons; there is something mysterious and ominous in the air.
The world population seems to have lost its connection with nature itself. People are self-centered in a very hedonistic way and have lost touch with their transcendent values.
They are ignoring something fundamental to existence, and as a consequence they feel an underlying insecurity.
They may be buying gold, but they are not buying what they really need: a spiritual rebirth.
