Inflation and Global Food Prices

Americans are currently struggling with inflation and certain categories, like fuel prices, get an outsized amount of attention. It makes sense. There are few products people buy as frequently that have as volatile a pricing scheme. It’s also universal. In a car-driven society, the pain at the pump is a metric most people are aware of.

But inflation certainly doesn’t stop there. Everything gets more expensive. But for many items, like cars and kitchen cabinets, purchases are typically few and far between. In terms of social and political stability globally, food prices are something that I find much more concerning.

The United Nation’s Food and Agriculture Organization does amazing work tracking global food prices and agricultural trends. They do work on par with the USDA, and I consider both to be preeminent sources of information in their field on the topic of American/global agriculture. And they publish their information for free. 

The FAO publishes monthly updates to global food prices. The picture is…not good. We’ve seen global food inflation drop a couple ticks in April and May of 2022 due to some softening in global oilseed markets (Indonesia has relaxed their palm oil export ban a bit, and we’ve seen some declining demand for oil seeds due to price) but the overall picture is still one of a stark increase in food costs. It’s a product of both an overall global inflationary environment, and a series of shortages due to conflict and poor weather (like the challenges facing Ukraine’s grain exports).

Let’s look at a couple of charts pulled from the latest FAO report (seen here):

2021, shown as the orange line, saw a pretty steady and straightforward increase in food prices between January and December, well over 2020 (in pink). 2022 is the aggressive, near-vertical line in red. The flattening out we see is again in large part due to some relaxation in food oil prices, but the news is certainly not good for global consumers. (And all of us in that bucket!)

If you want to break costs down into primary commodity groups, the FAO has you covered there as well. Peek at the second chart. Vegetable oils, the top line in green, is showing the greatest year-on-year increase. But prices have risen steadily across all globally traded commodity groups like cereals (including wheat) and dairy. We’ll have to see how the sugar harvest plays out in Brazil this year, but meat prices are also slowly but steadily inching upwards–as much a product of rising feed import costs as it is growing demand for poultry and fears over a widening avian flu epidemic.

If you prefer numbers, we can see that we’re already at or near historic high prices for almost all major commodity groups going back close to 20 years:

All of which represent a more expensive global food price environment. Large importers of food like Egypt are already scrambling and, according to some, purchasing Russian cargoes of stolen Ukrainian wheat. This is an issue that the US is starting to take seriously. And for countries dependent on food aid, like Syria and Yemen? Challenges abound, to say the least. While this is only one part of the global inflation story, it is one that most people globally will feel most acutely.

We invite those of you who are interested to join us today, June 8th, for our webinar, Inflation: Navigating the New Normal. More information at the sign up link below. Unable to attend the webinar live? No problem. All paid registrants and attendees will be able to access a recording of the presentation as well as a PDF of presentation materials.

Can’t register for the live event? Not to worry. We’ll be sharing how you can still buy access to the recording and presentation materials in the future.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Birthrates and the End of the World

My fourth book, The End of the World Is Just the Beginning: Mapping the Collapse of Globalization is scheduled for release on June 14. In coming weeks we will be sharing graphics and excerpts, along with info on how to preorder.

Demography forms one of the cornerstones of how we look at the world. Geopolitics means a lot of things depending on who you ask, but for myself and my team geopolitics at its core is the synthesis of the study of geography, demographics, and economy. That’s not to say things like military prowess, agricultural capability, and more aren’t important. But they’re secondary, in that they are shaped by factors like the quality of arable land and the amount of people you can put into factories or militaries or sell goods to. 

Enter this graphic from my upcoming book, The End of the World is Just the Beginning. We have a visual comparison of various historic birth rates for the last 170 years or so. Rises in birthrates, like for the US and Australia through in the 50s and early 60s correspond with the post-war Baby Boom. This is the last peak for most developed countries, who all saw a decline in the number of children born per woman as their respective industrial revolutions took hold and a rural-to-urban societal shift took place.

There are a couple broad trends to note: birthrates across the world–regardless of culture, religion, per capita GDP–have experienced a precipitous decline in recent decades. Egypt is an outlier, as are countries who have accepted significant numbers of immigrants/refugees relative to their population like Germany, Turkey, and Iran.

But the starkest decline is the thick, unbroken line in black. That’s China, and it’s bad. 

We’ve had indications for a while now that China was already one of the fastest-aging populations in the world. But with recent revisions of their population data coming to light last year we know that not only are they perhaps the fastest aging population in the world, their birthrate is one of the lowest. Only Spain’s and South Korea’s are lower–and just barely. 

When we talk about themes like The End of More in the book, we discuss how the Bretton Woods system allowed countries without the demographic wealth of pre-industrial China to use CCP-subsidized labor as part of globe-spanning supply chains. Chinese labor costs have increased handily in the last decade or two, but there’s more to the Chinese ticking demographic bomb than rising labor costs. China’s population is aging, and elderly people need more capital and labor for their care than young people. They consume less. They produce less. China is going to need more money to care for a growing segment of its population that is increasingly dependent on the state, with less young people to produce and consume the goods manufacturing that is the bedrock of the Chinese economy. Failing to do so would be untenable in any Confucian society that reveres its elders. For a China whose ruling Communist Party’s legitimacy is anchored to upholding a social welfare contract, failure is suicidal. 

Which still says nothing about a global manufacturing economy that since the end of the Cold War has had one foot planted firmly in China.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

A Mea Culpa, and a Correction

Nobody’s perfect. 

And in this industry, I feel strongly that it’s as important to own up to your mistakes as to highlight your successful forecasts and analyses. In a previous mail out this week, we included a graphic that included a significant bungling of numbers. (The corrected text is highlighted below.)

I would like to thank the readers and followers kind enough to point out the error. The how and why of it aren’t that important, but if you’re curious: as some of you pointed out–and as it stated on the original graphic–the data we used was annualized, and in a rush to publication we misplaced a decimal. Approximately $1.3 trillion/year became $13 trillion. Perhaps this is too much pressure to place upon the narrow shoulders of a humble decimal point. Perhaps I should have better understood the risks in letting an English major do the math while my primary researcher was in Ireland. But here we are, and due to your close readership we’ve been able to amend the graphic. 

Jokes aside, a strong sense of honesty and integrity is vital to our work. We strive to deliver our clients and readers as honest, direct and non-partisan a viewpoint as possible. I am thankful for the continued trust, and the attention you all pay to help keep us honest and accurate.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Pipeline Politics, Maritime Insurance, and Russia’s War in Ukraine

I’m re-sharing a couple of videos from early May to highlight a couple key trends coming to a head: the EU ban on Russian oil imports, and a continuing challenge of indemnification for ships carrying cargoes of Russian goods–oil, stolen Ukrainian grain, etc. 

On the first, it’s taken Europeans months to hammer out an agreement and a timeline–with plenty of caveats–but replacing your largest oil supplier overnight is a considerable feat. But EU leaders came out over the weekend announcing that a general framework had been reached, seeing most of the EU taper off of Russian oil by year’s end. One of the biggest exemptions is Russian crude delivered by pipeline, a necessary boon for landlocked importers like Hungary, and how Russia delivers a third of its oil to Europe.

While it’s easy to be cynical, we should not gloss over the fact that over the next several months the world’s largest economic bloc will be scaling down nearly 70% of its primary fuel source. Moscow is already adding European nations to its “do not sell list,” with the Netherlands joining Finland, Bulgaria and Poland in having to seek workarounds in accessing piped Russian natural gas deliveries. The Dutch have one of Europe’s largest LNG import terminals, and there is a lot of interconnected gas infrastructure to keep supplies moving around in the meantime, but the writing is on the wall. 

For now. 

The EU’s largest customers of Russian energy, Germany and Turkey, will the be ones to watch here. German corporations and labor unions remain opposed to a full German embargo of Russian natural gas and the Turks… well, when it comes to NATO and EU directives and sanctions packages, the Turks are going to do what’s best for Turkey.

Which makes the increasingly difficult time Russian cargoes are having all the more interesting. Private insurance companies, crews, captains, and port workers are simply refusing to cover, load, unload, and give harbor to Russian ships and Russian goods. While the EU is putting together another (the sixth!) sanctions package that will touch on some of these issues, the global shipping industry has shown a remarkable willingness to self-police and oppose Russian participation in regional and global shipping markets. China and India may continue to buy Russian crude (for now), but they’re doing so with state-owned ships and with state-backed insurers underwriting everything. Both economies are far too large to handle all of their goods trade in such a matter, however, and it will be interesting to see if their purchases of heavily-discounted Russian crude oil will be met with any market-driven consequences from the shipping industry. 

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Inflation: the Savings Angle

Between the Ukraine war, supply chain shortages, energy shocks, and government policy that probably spent too much money for too long a period of time, Americans are feeling the pinch of ever-higher inflation on an ever-broadening array of goods. The question is whether Americans can’t afford it.
 
The chart below shows what percentage of their income Americans are socking away – that all-important “savings rate”. During COVID it hit record highs. But now? It has already plunged to pre-COVID lows.

It looks a bit spooky, right? Maybe even a little recessionary? After all, if Americans don’t have a savings buffer, any curveballs – and we seem to be living in world of nothing but curveballs – could cause immense damage.
 
But the chart needs context.
 
It’s one thing for Americans to no longer be saving, it’s quite another when you consider just how much they have already saved. Take a look at this second graphic (below) which stretches back to before the 2007-2009 financial crisis. Whereas the first graphic showed the savings rate (the percentage of income saved), this second one shows savings volume (the actual amount of cash).

Between the Trump and Biden Covid stimulus checks, Americans amassed an extra $13 trillion in savings.
 
So are Americans burning through their savings purchasing goods whose prices keep going up and up and up? Absolutely.
 
But $13 trillion is roughly how much all consumers in the United States spend in ten months. Even in an inflated environment, it will take most Americans two years to burn through the surplus.
 
It doesn’t quite make Americans price insensitive, but it certainly suggests that the current levels of consumption – and by extension current levels of demand-driven inflation – can be with us a lot longer than the headline “savings rate” would suggest.
 
How long? Well, that’s part of what we’ll be going through in our next seminar. We invite those of you who are interested to join us for our upcoming webinar, Inflation: Navigating the New Normal, on June 8th. More information at this link. Unable to attend the webinar live? No problem. All paid registrants and attendees will be able to access a recording of the presentation as well as a PDF of presentation materials.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

China and Taiwan

At the outset of the Russian invasion of Ukraine, there was significant concern that China would follow with its own invasion of Taiwan. With both Moscow and Beijing moving to secure what they consider breakaway states within days of each other, the United States–months away from its own messy pull out of Afghanistan–would be too caught in a lurch to react to either. 

That obviously didn’t happen. 

It’s not that China is not always considering how it can bring Taiwan back into the mainland’s fold. It’s just a question of what the scope of an invasion would look like, and what sort of consequences the Chinese will be brought to bear. The arithmetic and planning for both have changed sharply in recent months.

If anything, Russia’s bungled invasion of Ukraine showed the Chinese that there’s no quick or easy way to overwhelm a fortified and prepared neighboring state. Consider the fact that the Ukrainians have only really existed as a unified, functional post-Soviet country since the Russian’s first invasion of the Donbas in 2014. Taiwan has been preparing for a potential Chinese invasion for over six decades. 

There’s also the obvious fact that Taiwan is an island. The Russians attempted to slow-roll a land based invasion from Russia and Belarus into Ukraine. China is going to have to move armor, soldiers, supply chains, etc across the Taiwan Strait or by air. En masse. This is something incredibly difficult and costly to do even for the best equipped air forces and navies. China’s remain largely untested. 

And then there is the threat of international reaction. China’s proximity to the world’s most concentrated production hub of high-end semiconductors seems like effective leverage. And to some extent, it is. But China’s workers lack the skillset to design and build the high-end chips Taiwan is known for. And most of the R&D happens in the United States. While Taiwan’s plants would most likely shutter, one should keep in mind that much of China’s most valuable exports–high end electronics, smart phones, etc.–are reliant on these very same chips.

Which brings us to global consequences. The world is not going to take lightly to the Chinese upending the chip supply chain. Nor can China expect to avoid crippling economic consequences. Consider that outside of energy and extracted resources, Russia has not spent most of its post-Cold War life integrating too heavily into the global economy. China is the complete opposite. Whatever difficulties Moscow is facing with Western economic sanctions, China’s pain would undoubtedly be orders of magnitude worse.


We invite those of you who are interested to join us for our upcoming webinar, Inflation: Navigating the New Normal, on June 8th. More information at the sign up link below. Unable to attend the webinar live? No problem. All paid registrants and attendees will be able to access a recording of the presentation as well as a PDF of presentation materials.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:

First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.

Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.

And then there’s you.

Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

The Bond Market and Inflation

The U.S. Federal Reserve is in the midst of raising interest rates. By raising the cost of borrowing and making debt (money) more expensive, you control spending thereby controlling inflation. 

The United States is currently experiencing the worst inflation crisis in some 40 years. The Federal Reserve’s interest rate hikes are the traditional tool in combatting such a problem. 

The challenge of inflation is not America’s alone. Across Europe and Asia, global currencies are seeing inflation drive up the cost of food, fuel, consumer goods, and housing. Unlike the United States, however, most countries’ central banks do not have as direct a course to combat inflation as the Federal Reserve.

A combination of demographic and Russian sanction-related inflationary pressures limit most European nations’ abilities to aggressively raise rates. A population as old and quickly aging as Germany or Italy’s is unlikely to see a bounce back in consumer spending once rates return to zero–where they have been for over a decade. This is a move the Europeans copied out of Japan’s playbook, whose nearly 20 years of near-or-at-zero interest rates are likely to be their foreseeable future.

So what does this mean for bond markets? The U.S. has the demographic strength and economic resilience to keep raising its interest rates, while the rest of the world will be forced to continue issuing bonds at or near zero. Which means their bonds, and ability to borrow, will soon become strongly uncompetitive vis-a-vis the United States.

What does this mean for inflation and the US economy writ large? We invite those of you interested to join us on a webinar that will cover these topics and more in depth on June 8th. More information at the sign up link below. Unable to attend the webinar live? No problem. All paid registrants and attendees will be able to access a recording of the presentation as well as a PDF of presentation materials.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Energy, Currencies and Inflation: Worse for Some

In the worlds of finance, trade, economies, currencies and energy there is a lot going on. We’ve a war in Ukraine that will likely generate the largest oil dislocation in modern history. The global Baby Boomer generation is retiring and taking their money with them, generating the largest financial dislocation in modern history. Presidents Trump and Biden are following the same script on trade issues, generating the largest trade dislocation in modern history. And the Federal Reserve is tightening monetary policy in an effort to tamp down inflation.
 
The implications of all these seismic shifts are many and massive. Here’s two of them:
 
Whenever countries are struck by economic shocks – like, say, now – investors look for safer places to stash their money. Less money into tech, more into consumer products. Less money into Brazil, more into Europe. The safest of all safes is the United States, and so the U.S. dollar is on a bit of a tear, rising by roughly 10 percent verses most of the world’s currencies since the beginning of the year.
 
A rising dollar has any number of outcomes, but the one making the biggest splash at the moment is its impact upon energy markets.
 
Oil prices were already rising due to a variety of factors ranging from insufficient investment in new projects over the past several years, to disruptions in trade patterns, to, of course, the Ukraine War. For the United States this is known and obvious. But all commodity trade is denominated in U.S. dollars. Oil is no exception. Combine oil’s price rise with a strengthening dollar and much of the world takes a double hit.
 
Brazil’s real has largely kept pace with the U.S. dollar, so this energy hit doesn’t land on Brazilians quite as hard. But Europe and Turkey? Those locales heavily depend upon Russian crude. Not only does that challenge their supply systems, it’s also contributed to the pair’s suffering from significant currency weakness. The end impact? In local currency terms, internationally sourced oil now costs 10-15% more in Europe and Turkey than it does in the United States.

Unfortunately, there is little reason to expect the world’s energy situation to improve within the next half decade, nor is there reason to expect the U.S. dollar to go anywhere but up for years to come. But that is a story for another day.
 
That day is … June 8. That’s when we’ll be hosting our next seminar, Inflation: Navigating the New Normal. You can sign up here.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Energy at the End of the World

My fourth book, The End of the World Is Just the Beginning: Mapping the Collapse of Globalization is scheduled for release on June 14. In coming weeks we will be sharing graphics and excerpts, along with info on how to preorder.

Here’s something a little different than the usual video updates from us. We typically seek to update your inbox with reactions to global events of consequence (if it seems like there are more of those than usual these days, boy do I have a book for you!).

About a month ago, however, I had to honor of speaking to a group of students at the Dwight D. Eisenhower School for National Security and Resource Strategy, a college of the National Defense University. 

I hope this presentation is valuable to those of you who are interested in long-term and more in-depth forecasts and analysis, and those of you who enjoy longer format presentations. My thanks to the Eisenhower School and NDU for sharing this video.

In this presentation I lay out my long-term forecast for global energy, cribbing heavily from the text of my upcoming book The End of the World is Just the Beginning. The book also contains similar long-term forecasts for global finance, agriculture, manufacturing, and transport. We are less than three weeks away from the books release date. Information below on how to pre-order for those of you who wish to support the new book.

As a reminder: the Afya foundation continues to support humanitarian efforts and refugees displaced by Russia’s war in Ukraine. Links below on how to help for those of you who are willing and able.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
And then there’s you.
 
Our newsletters and videologues are not only free, they will always be free. We also will never share your contact information with anyone. All we ask is that if you find one of our releases in any way useful, that you make a donation to Medshare. Over one third of Ukraine’s pre-war population has either been forced from their homes, kidnapped and shipped to Russia, or is trying to survive in occupied lands. This is our way to help who we can. Please, join us.

CLICK HERE TO SUPPORT MEDSHARE’S UKRAINE FUND

CLICK HERE TO SUPPORT MEDSHARE’S EFFORTS GLOBALLY

Tianjin, COVID, and Losing Chinese Labor

Several signs point to THE possibility of Chinese officials instituting at least a partial lockdown of the northern port city of Tianjin as early as this weekend. The largest northern Chinese port, Tianjin is also a city of over 12 million people, and its port is vital for delivering goods–bulk ores, coal, liquid fuels–for the region’s heavy industries and textile manufacturing. 

The Omicron variant has already been detected in the city, notably in the Beichen and Dongli districts, where local health officials mandated localized testing and quarantine restrictions on May 16. Widespread testing through these areas–and the removal of tens of thousands of residents into forced quarantine–now looks like it might spread throughout the city. Local officials have also already gone ahead and identified a scapegoat: imported frozen food products.

What’s a little authoritarian lockdown without some trade nationalism?

Tianjin already experienced a partial lockdown in January of this year. Partial in part due to the city’s vital role as the primary port serving Beijing, and also a domestic concern over optics during the Olympics. As we’ve seen from reports and local social media uploads, the lockdowns at the very least cause an undue amount of stress on local Chinese residents. At their worst, they reveal the ugliest face of an authoritarian regime that uses drones to threaten its citizens who dare to scream out in hunger in the middle of the night.

Beyond the human toll of these lockdowns, the Chinese economy and manufacturing base is increasingly finding itself disconnected from global trade. China’s financial hub of Shanghai is currently in its seventh week of lock-down, the southern port city and manufacturing hub of Guangzhou is under lockdown, more and more districts of the capital city of Beijing are entering a so-called “slow motion” lockdown. If we add in Tianjin, as it increasingly looks like we might, that’s several of China’s largest trading and industrial zones, plus the administrative core, under lockdown.

Even in cases where the government seeks to ease lockdowns for critical manufacturing and port operations, worker shortages in China are causing all manner of delays and supply chain dislocations. Over a hundred ships are waiting off of the port of Shanghai as of writing (Hong Kong and Shenzen have nearly 200). Lest you think that labor issues have been sorted out at Western ports, let me remind you that there is still a wait of over three weeks for ships to dock at the port of Vancouver.

It is hard to overexaggerate the role of the Chinese worker in our current globalized economy, and the impact Chinese labor has had on the post-Cold War system. All of that is going away. In return? Rising labor costs, at a minimum. Assuming you can find the workers. Think inflation is bad now? Just wait.

Nervous? Join us June 8th for a webinar on the global geopolitical environment that will be driving US inflation for years to come. Sign up information at the link below.

Here at Zeihan On Geopolitics we select a single charity to sponsor. We have two criteria:
 
First, we look across the world and use our skill sets to identify where the needs are most acute. Second, we look for an institution with preexisting networks for both materials gathering and aid distribution. That way we know every cent of our donation is not simply going directly to where help is needed most, but our donations serve as a force multiplier for a system already in existence. Then we give what we can.
 
Today, our chosen charity is a group called Medshare, which provides emergency medical services to communities in need, with a very heavy emphasis on locations facing acute crises. Medshare operates right in the thick of it. Until future notice, every cent we earn from every book we sell in every format through every retailer is going to Medshare’s Ukraine fund.
 
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