### Summary #### Core Predictions - High and rising inflation - Deep recession, potentially leading to depression - Dismantling of rural economies - Breakdown of the Bretton Woods system that controlled economic fluctuations - Long-term application of tariffs with no return to globalized trade - Possible manufacturing collapse triggering Depression-like conditions #### Regional Impacts ##### North America - NAFTA restructuring has deeply affected continental trade dynamics - Mexico: Manufacturing sector failure could lead to state instability and narco-state conditions - Canada: Economic disruption could create a hostile relationship, potentially seeking nuclear capabilities ##### United States - Consumer goods cost increases (phones potentially tripling in price) - Manufacturing hardest hit by steel/aluminum tariffs - Michigan specifically facing manufacturing depression - Agricultural exports to China effectively ended (65% of grain exports impacted) - Regional consumption patterns will emerge - Industrial, manufacturing, shipping sectors all facing recession - Loss of status as most stable consumption base and financial superpower - Housing market disruption - Pharmaceutical costs potentially increasing 4-5x - Temporary decrease in fentanyl supply followed by domestic production ##### Global - East Asia and Europe expected to "crumble" due to lack of consumption markets - Development work in Southeast Asia severely damaged - Chinese debt issues becoming apparent in markets - Potential withdrawal from NATO by end of year #### Economic Transformation - Shift from different economic growth models: - Consumption-led (US) - Export-led (Germany, South Korea) - Debt-driven investment (China) - Transport costs increasing from 1-2% to 10-15% of goods value - Shipping industry disruption with focus only on largest vessels to super ports - High-end technologies (EVs, satellites, AI) require global cooperation #### Notes on Recent Developments Based on comments at the end of the transcript, during the meeting there was breaking news about: - Trump raising tariffs on China to 125% - A 90-day pause on tariffs for countries in negotiations - A significant market rally in response to this news This appears to be a very alarming assessment of current economic conditions, with Zeihan suggesting we're entering a period of economic transformation that will significantly disrupt global and domestic systems. The focus is on how tariff policies and the breakdown of globalized trade will impact different regions and sectors. ### My Notes - expectations - high and rising inflation - deep recession and probably depression - rural dismantling - chipping away at Bretton Woods situation to control economic fluctuations and security - advanced world was always going to age out of the consumption based globalized trade system break down in this 2020s - **tariffs will be on for a long time** - we are not coming back to the globalized world - setoff bomb in our manufacturing that will cause a great depression at home - nafta was about imperialsim, we took over as the center of trade for canada and mexico and we made them pay for it! - canada and mexican economies do not work without us due to geography - manufacturing in mexico fails -> becomes failed state narco - hostile Canadian state seeks nuclear weapon - east asia and europe will crumble due to lack of consumption - we've smashed our decades long development of SE asia - buy a phone it will cost 3x soon - Apple flew their last manufactured goods flight last night to get under the tariff - ![[Pasted image 20250409123319.png\|500]] - markets are going to price in the MASSIVE Chinese debt - economic growth - consumption led (US) - export led (germany, south korea) - debt driven investment - ![[Pasted image 20250409123439.png\|400]] - expect financial run around that makes Enron look like a picnic - china will try to product dump because it's the only way to employee their people which will lead to retaliatory tariffs - rank nationalism vs. economic dysfunction - we are maximizing the damage to ourselves from the inevitable down fall of global trade - ![[Pasted image 20250409123737.png\|400]] ![[Pasted image 20250409123759.png\|400]] - east asian supply chain will collapse with the chinese - withdraw of global shipping form US ports commodity trade via container ships stop - 3 million container fee per ship --> only largest vessels to super ports - transport = 1-2% -> 10-15% #important - like covid demand 5x - there are no U.S. crewed vessels at size that cross the ocean. Trump forgot he had to build the ships first - pharmacy 4-5x cost - pill press need to bring back at 300% tariffs - bleeding edge meds come from europe biologics and high end drug - fentynal supply is going to fall for a couple years... then it'll be made in your neighbors house - american industrialism - hit by steel/aluminum tariffs hardest - products cross the borders on average 6 times - ![[Pasted image 20250409124859.png\|400]] - gross state product ![[Pasted image 20250409124932.png\|400]] - Michigan will be in a manufacturing depression #important - agriculture - ![[Pasted image 20250409125101.png\|400]] - agricultural market to china is over - 65% grains exports, - american changes - will consume what we produce regionally - industrial, manufacturing, poor consumption recession, shipping recession - we are no longer the most stable consumption base and financial super power - global recessions and American stagflation - 3k iphone - what's going to break around the world - will probably leave nato by end of the year -> turning longest and most loyal ally into a nuclear armed rival - we broke the world system before without doing what is necessary to adapt to the new world order - housing - American can make 90-10nm chips - high end: electric vehicles, satellites, AI - need the entire world!!!