The Global Economy And The Impending Implosion

How many times in the past several years have you heard the phrase, “We are now living in a global economy.”  I personally feel like the “global economy” was the greatest excuse for exporting jobs to
countries where you can build items a slave labor costs with no regulation.  However, the sad truth is that corporations and western governments have now managed to build a global economy, at the expense
of western workers, and the whole creation is about to implode. Every economic region of the world is now experiencing severe economic problems and we are interconnected to the extent that and a strong shock to any single economy has the potential to bring down the whole system. In keeping with navigatethezoo.com style, this article will be easy to understand even if you are completely disinterested in economics. I will explain to you several of the major global economic events that are leading up to a complete global economic meltdown.  Make no mistake; this implosion will affect your life far more than you may think in years to come.

To begin, it is important to look around the world and understand that every major economic region is facing unprecedented economic turmoil. When you put all of the world’s economic regions into one big picture, you begin to realize that there is not a sturdy leg left to support additional weight on the table.

We will begin in the United States.  We have a job market that has not rebounded will not rebound unless we somehow manage to bring a large number of manufacturing jobs back here.  We have a housing market in which home values have now fallen to greater percentage losses that were seen in the great depression.  Without job security, people will not buy a house, and without people buying houses millions are left unemployed in their fields. To put context on severity of he problem; if people were to buy houses at the level that they did in the height of the housing boom, it would take a year just to clean the foreclosed properties off the market.  This does not include building any new homes or non-distressed sellers just trying to sell their homes because they need to move.

We should now look at Europe and more specifically the countries that use the euro currency, known as the euro zone.  The euro currency is facing several major problems that threaten to bring down major
European banks, European economies, and the global economy all together.  I have always felt that the euro currency was a stupid idea.  Unlike the United States, which has a federal government that
has the ultimate say in most economic issues, each euro zone country is autonomous from the next.  If one country decides to act foolishly, the whole currency can be destroyed and there is no real authoritative body that can put its foot down.

Currently several euro zone countries are facing problems and the two most economic powerful euro zone countries, France and Germany, are being forced to bail them out. Greece, although it only has the
equivalent economy of Philadelphia, is currently the biggest problem for the euro.  After years of too much borrowing, inefficient tax collection, poor monetary policy, and entitlements galore, Greece has
a huge deficit and no real way of paying it.

If Germany and France let Greece implode, the euro implodes dragging Europe down with it.  France has already been warned about its credit rating because of its’ exposure to Greek loans.  To make
things worse, the US stock market has already shown that it is vulnerable to euro currency problems. Many of our banks have exposure to loans that would result in huge losses if euro zone countries implode.

Next, let us move to the Middle East and North Africa.  There are so many problems in this part of the world that it would take countless articles to discuss.  What you need to take away from this situation is one simple fact: problems in the Middle East and North Africa translate to higher oil prices.  For every dollar per barrel that oil goes up, it drains a ton of money out of the economy that could be
used for other things.  Think of it as a negative stimulus package. If massive riots were to start in Saudi Arabia, you can forget everything you know about the way you live your life.  Gasoline would
double overnight.  Everything at the supermarket would go way up in price because it would cost so much to transport the goods.  Airline tickets would become astronomically high.  In essence, the economy would come to a screeching halt.

Finally, we need to look at China, the big dog in the room.  China is touted as this unstoppable force of nature that is destined to take over the world and leave us in the dust.  I am not so convinced of
this and my reasoning is derived from several major weaknesses and vulnerabilities that China has.  Three of China’s main problems are food, water, and inflation.

China’s population is so huge that it is really more of a weakness than a strength.  They have already managed to drain one of the countries two main underground water aquifers, which took millions of
years to build up.  Much of their growing land has turned to desert because of their over use of the soil.  China knows it is running out of water and food and it has no good solution available to fix this.
China must keep its 1.3 billion people fed.  If 300 million people start to get hungry, the government will lose control and be ripped apart rapidly.

China’s other major problem is inflation.  In American, we spend about 10% of our household incomes on food.  In China, much of the population spends a majority of its household income on food.  Many
Chinese have gotten wealthier and as a result are now able to buy more food.  The increased demand from the emerging middle class has driven food prices up across the country.  For the majority of poor Chinese, this is not a good thing.  These folks are now risking going to bed hungry because of rising food costs.  When you have 400 million people going to bed hungry, a powder keg begins to form because nobody is more desperate and frustrated than someone who is hungry.

On that note, rising food prices threaten global stability as a whole. Many analysts think that the Middle East and North African riots are a result of rising food costs and not the will to have a democracy.
Like I said before, if someone is spending 90% of their money on food, and food doubles, that person is now in a world of grief. The truth is that the morons with their corn-ethanol lobbying are what drove up food prices across the globe.  The irony of the pro-green energy left causing the starvation of millions would be comical if it were not real.

So there we have it, one huge global system on the brink of implosion. If just one of these regions takes a turn for the worse, it drags everyone else with it.  If the United States has a poor corn or wheat
harvest, the Middle East, Africa, and Possibly China riot over food.  If Greece implodes, it takes out the fragile European markets which then take out the fragile US stock market.  If Europe and the US can’t feed China money in the form of buying goods, they will implode as well.

The question you have to ask yourself is, “With such a large and messed up world, all reliant upon the success of one another, isn’t it likely that one country or region will end up being the catalyst
that sets the whole thing off?”

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