Thursday, September 11, 2025

Multiple unchartered risks - All at the same time

The world today is going through multiple unchartered risks, all at the same time.

Finance:

1. US debt gone to unsustainable levels that multiple people have commented on the sudden fall of the US economy and the US Dollar. Ray Dalio calls it the economic heart attack. We haven't seen anything like this after world war 2 where an empire is coming down. USSR was a breakage. This is different.

2. Japan has continued the zero interest policy causing massive borrowings in Japanese Yen and conversions to USD and investments in treasuries. The increase in the Japanese interest rate would easily cause the mass selling of the USD and the treasuries to pay back the Japanese borrowings. For the first time, the Japanese central bank is at risk and a Central bank at risk has never happened before.

3. France and UK have worsening finances and are expected to go to IMF next year for debt restructuring. This is the first time, giant western economies are under so much financial stress and IMF is small to carry the load of these economies. A first again.

4. Global finance decentralisation and derisking - From Asian countries planning alternate payment mechanisms to SWIFT, multiple countries decreasing their assets of US treasuries, most countries buying physical gold, BRICS discussing a new currency, bilateral trade in some countries being done in each other's currencies. A first again.

Trade:

1. Decades of established specialisations is being turned useless with unexpected turmoil by illogical tariffs by the US Administration.

Wars:

1. No one expected a physical war in Europe when Russia attacked Ukraine. A first of its kind since world war 2. And continuing so long? That is something no one can even fathom.

2. The Israeli massacre of the starving people asking for food aid is cruelty of another era, of the bygones, or so we thought.

3. USA threatening Venezuela with war (as if we need another US based forced leadership change after so many of them)

4. 19 Russian drones in Poland shot down as on 10 Sep 2025. (Start of NATO-Russia war leading to world war 3?)

Technology:

1. AI is disrupting human work. The future of many works remains uncertain.

2. AI - singularity, where it gets smarter than millions of humans together can break human superiority and become the apex controller and the humans the slaves/ pets/ prey. Humanties' first instance of more intelligent life.

Unemployment:

1. Tariffs and geopolitical disputes (US tariffs, Bangladesh-India, Russia-Ukraine war) causing industries to rupture and unemployment to increase.

2. AI bringing more unemployment its own way

3. US cutting down departments and uncertainty of outsiders in USA by creating visa issues and even threatening green card holders.

Countries standing up:

1. India and Japan standing up to the bullying of the US

2. France being the first western country to recognise Palestine as a state


Each of the above are volatile enough to cause a cocktail of furious unexpected events to happen in multiple domains of finance and/or economic turmoil each affecting the other one and our lives in unexpected ways.

But with all these risks running simultaneously, I think the world is in the most dangerous phase I have ever witnessed in my lifetime.

Any month could be our last (in case world war 3 happens).

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