The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of Oceania Saker.
New Silk Roads and the Chinese Vision of a Brave New (Trade) World
BEIJING — Seen from the Chinese capital as the Year of the Sheep starts, the malaise affecting the West seems like a mirage in a galaxy far, far away. On the other hand, the China that surrounds you looks all too solid and nothing like the embattled nation you hear about in the Western media, with its falling industrial figures, its real estate bubble, and its looming environmental disasters. Prophecies of doom notwithstanding, as the dogs of austerity and war bark madly in the distance, the Chinese caravan passes by in what President Xi Jinping calls “new normal” mode.
“Slower” economic activity still means a staggeringly impressive annual growth rate of 7% in what is now the globe’s leading economy. Internally, an immensely complex economic restructuring is underway as consumption overtakes investment as the main driver of economic development. At 46.7% of the gross domestic product (GDP), the service economy has pulled ahead of manufacturing, which stands at 44%.
Geopolitically, Russia, India, and China have just sent a powerful message westward: they are busy fine-tuning a complex trilateral strategy for setting up a network of economic corridors the Chinese call “new silk roads” across Eurasia. Beijing is also organizing a maritime version of the same, modeled on the feats of Admiral Zheng He who, in the Ming dynasty, sailed the “western seas” seven times, commanding fleets of more than 200 vessels.
[Please click below to continue reading] Continue reading Year of the Sheep, Century of the Dragon?, Pepe Escobar
Dmitry Orlov has an amazing knack of processing information and then presenting to you, in his usual humorous fashion, the nuggets of truth.
Here Dmitry gives us another 30,000 foot view of what is happening to us and our planet.
This blog is dedicated to the idea of presenting the big picture—the biggest possible—of what is going on in the world. The abiding areas of interest that make up the big picture have included the following:
1. The terminal decay and eventual collapse of industrial civilization as the fossil fuels that power it become more and more expensive to produce in the needed quantities, of lower and lower resource quality and net energy and, eventually, in ever-shorter supply.
The first guess by Hubbert that the all-time peak of oil production in the US would be back in the 1970s was accurate, but later prediction of a global peak, followed by a swift collapse, around the year 2000 was rather off, because here we are 15 years later and global oil production has never been higher. Oil prices, which were high for a time, have temporarily moderated. However, zooming in on the oil picture just a little bit, we see that conventional oil production peaked in 2005—just 5 years late—and has been declining ever since, and the shortfall has been made up by oil that is difficult and expensive to get at (deep offshore, fracking) and by things that aren’t exactly oil (tar sands).
The current low prices are not high enough to sustain this new, expensive production for much longer, and the current glut is starting to look like a feast to be followed by famine. The direct cause of this famine will not be energy but debt, but it can still be traced back to energy: a successful, growing industrial economy requires cheapenergy; expensive energy causes it to stop growing and to become mired in debt that can never be repaid. Once the debt bubble pops, there isn’t enough capital to invest in another round of expensive energy production, and terminal decay sets in.
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