Slow Motion & Rapidity in Tandem
How seemingly unrelated events come together first slowly and obviously, then rapidly with great force — the examples of our times.
Since 2007 we have observed some strange goings on in the global economy. What we once believed has been unpicked by events that seem to be unrelated but usually turn out to be part of a much bigger and longer series of changes. Yet of course we are too distracted by our daily lives, our smartphones, shopping, media events and in many cases just survival to take the necessary step back to take in the bigger picture.
The world has been on a huge regression spiral. Nearly all of us in Western countries have witnessed a decrease in material living standards, availability of disposable income, quality of state service provision and may other factors that contribute to our perceived standard of living. But, this seems to be a taboo. Not noticing the increased speed of the current against us we have to row harder just to stay in the same place. It’s incredible how when changes are gradual and slow we humans are able to convince ourselves that everything is ok, we will endure hardship and pain to pursue our goals. Of course tenacity and determination are important attributes that have contributed to the success of our forefathers and indeed these value have been passed on through our upbringing. Yet there is a key difference between then and now, and that is that we now contend with external factors out of our control that have the power to rapidly change the environment around us.
It’s possible to see some of these changes happening in slow motion, indeed many of them of a financial nature will be reported in drips and drops through the specialist financial press, some independent internet aggregators piece together the information that often paints a picture of a terrible situation in which we are completely under the control of those that control our currencies in central banks. To be clear these banks are not trading in substance — i.e. something of tangible value such as gold, silver, any kind of precious metals or indeed in physical commodities that actually exist — what they are dealing in are highly complex financial instruments such as the colleateralised debt obligations that caused so much damage to US and European financial systems by essentially repackaging low quality debt that stood a high chance of not being paid off (e.g. subprime mortgages — these were essentially mortgages that were pressure sold to poor people at low interest rates with few checks as to whether those taking them had the monthly income to cover the costs) — the term we heard was “toxic debt” and indeed those that were found to be holding these envelopes when the music stopped had to make drastic alterations to their balance sheets overnight and admit that they had not been as responsible as all of their slick marketing materials claimed they were. The resulting “credit crunch” was nothing but a complete breakdown of confidence between instuitutions and more critically between lenders and companies that needed credit to run their businesses — which in the supply-chain world of many companies in Western Europe was pretty deadly for small to medium sized enterprises that didn’t have the financial wherewithal to prefinance customer orders and absorb 90 day payment terms demanded by customers. The result was the massive shedding of quality jobs across many economies of the world.
Politicians responded to these events with two strategies: firstly to strap all of the private debts of the financial institutions onto the backs of the people whilst at the same time grasping to the second policy of austerity for the populations of their countries which saw state budgets drastically cut. Communism for the rich and hardcore capitalism for the people. To date in Europe not one banker has been jailed. Notable exception being Iceland which not only decided to default on the fictitious debts but also punish financial criminals with lengthy jail terms. In Europe administrators already completely dependent on the financial instututions they allowed to inflate the economic bubble of the 80's & 90's felt that they had no choice but to back up their financial masters. The net result has been the state restructuring of failed private financial institutions on the costs of the taxpayer with little benefit to those actually taking on the risk and (in most cases unknowingly) refinancing these banks. The highly public show-trial of Greece was little more than a distraction away from the real malaise at the heart of the irresponsible German and French banks that had piled debt into Greece, Spain, Portugal and Italy in the knowledge that if anything went wrong the politicians would back them and bail them out if necessary — or enforce massively unfair reforms on people unable to protect themselves from powerful external actors.
Why does this matter now? Well it shows that even if we can observe some changes happening in slow motion it’s a bit like a Tsunami wave, first of all it is very large and appears in the distance to be moving very slowly, we turn to each other and point, maybe say “that looks like a wave…” then turn away, distracted by a change in the news-cycle, usually a political non-event or scandal. By the time we look up we notice that indeed it is a wave and now much closer to us it’s remarkably fast and it envelops us completely — with a speed and power completely unknown to us. Exactly that is the situation that has been recently seen in China recently with the sudden wave of destruction ripping through the stock market and economy. The ripples from this crisis will affect all nations plugged in to the globalised trade grid.
A futher example is the migration crisis building around Europe. All of the countries of the Arab spring, plus Palestine Lebanon, Northern Iraq and Syria have seen terrible destruction as a result of various revolutions, coups, removals of “dictatorships” and instillation of democracy by force, most usually covertly supported by western intelligence services and military organisations, and of course arms dealers. The knock-on effect is that millions of people have see their orderly lives destroyed, many have no safe haven left and thus they do a very human thing — they seek refuge, in a place they think will be safe. The nearest place they can see on a map is Europe. The combination of weak outer borders of the EU, together with a lack of resources and training of border forces to deal with masses of migrants combined with highly organised people trafficking gangs accepting large cash payments to get migrants into Europe sees massive build-ups of people as has been seen in Budapest, or Calais. Worse we see awful tragedies such as the 70 people dead in the back of a truck in Austria. It would appear that this kind of thing is going to become more commonplace as pressure builds and the cold weather sets in across countries bordering European Union or close to Europe. The true extent of the terrible conditions in Refugee Camps goes largely unreported in Western Media.
To make things worse European economies have been flatlining in what many economists agree is a slow-motion depression; the response to this has been best characterised by the now departed Greek finance minister Varoufakis as “extend and pretend” referring to the massive quantitative easing programmes by central banks which as seen IOUs of “money” created out of thin air and pumped into the economies — thus creating the illusion of stability and recovery. the problem is that this cash has not gone where it was needed, instead it has been used to reflate the bubbles in property markets causing a dangerous and precarious situation.
What we observe around us appear to be unrelated and complex situations that we are powerless to influence. Politicians try to deal with these in simple terms of morality, good and evil. Terrorists and law-breakers. Opportunist Political Parties such as Populists Far Right Organisations, Xenophobes and their relatives along with the popular media stoke the fires of hatred and misunderstanding. Real high-quality information based on facts is increasingly hard to come by because most media no-longer use qualified journalists in the field but instead repurpose agency content from Reuters, AFP and such like — merely employing columnists to write opinion pieces to pad out their publications. It takes an inordinate amount of work to uncover reliable sources of citizen journalism, an activity for which most of us have neither the time or energy required to do properly. The great irony is that in this age of always-on internet, total communication and what we consider to be the crowning glory of the information age we are actually worse-informed than we have been for a long time.
What to do? The only logical conclusion that can be drawn is that in these uncertain times we need to take time to consider what’s happening around us and use our own analytical skills to evaluate the deeper meaning of what we see. We also need to use our intuition to understand what we feel in any given situation and work out which course of action will be best for us and our families but also for the victims of such crises as we see — for compassion is what makes us human and we would do well to remember that.