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Roubini: Many Davos Speakers Think It’s Like 1914 … Right Before WW1 Broke Out Washington’s Blog


Roubini: Many Davos Speakers Think It’s Like 1914 … Right Before WW1 Broke Out Washington’s Blog.

Nouriel Roubini, Davos Speakers, Kyle Bass, Larry Edelson, Charles Nenner, James Dines, Jim Rogers, Marc Faber, Jim Rickards and Martin Armstrong Warn of Wider War

Well-known economist Nouriel Roubini tweeted from the gathering of the rich and powerful at Davos:

Many speakers compare 2014 to 1914 when WWI broke out & no one expected it. A black swan in the form of a war between China & Japan?

And:

Both Abe and an influential Chinese analyst don’t rule out a military confrontation between China and Japan. Memories of 1914?

Many other economists have forecast war.

Kyle Bass writes:

Trillions of dollars of debts will be restructured and millions of financially prudent savers will lose large percentages of their real purchasing power at exactly the wrong time in their lives. Again, the world will not end, but the social fabric of the profligate nations will be stretched and in some cases torn. Sadly, looking back through economic history, all too often war is the manifestation of simple economic entropy played to its logical conclusionWe believe that war is an inevitable consequence of the current global economic situation.

Larry Edelson wrote an email to subscribers entitled “What the “Cycles of War” are saying for 2013″, which states:

Since the 1980s, I’ve been studying the so-called “cycles of war” — the natural rhythms that predispose societies to descend into chaos, into hatred, into civil and even international war.

I’m certainly not the first person to examine these very distinctive patterns in history. There have been many before me, notably, Raymond Wheeler, who published the most authoritative chronicle of war ever, covering a period of 2,600 years of data.

However, there are very few people who are willing to even discuss the issue right now. And based on what I’m seeing, the implications could be absolutely huge in 2013.

Former Goldman Sachs technical analyst Charles Nenner – who has made some big accurate calls, and counts major hedge funds, banks, brokerage houses, and high net worth individuals as clients – saysthere will be “a major war starting at the end of 2012 to 2013”, which will drive the Dow to 5,000.

Veteran investor adviser James Dines forecast a war is epochal as World Wars I and II, starting in the Middle East.

Billionaire investor Jim Rogers notes:

A continuation of bailouts in Europe could ultimately spark another world war, says international investor Jim Rogers.

***

“Add debt, the situation gets worse, and eventually it just collapses. Then everybody is looking for scapegoats. Politicians blame foreigners, and we’re in World War II or World War whatever.”

Marc Faber says that the American government will start new wars in response to the economic crisis:

We’re in the middle of a global currency war – i.e. a situation where nations all compete to devalue their currencies the most in order to boost exports. And Brazilian president-elect Rousseff said in 2010:

The last time there was a series of competitive devaluations … it ended in world war two.

Jim Rickards agrees:

Currency wars lead to trade wars, which often lead to hot wars. In 2009, Rickards participated in the Pentagon’s first-ever “financial” war games. While expressing confidence in America’s ability to defeat any other nation-state in battle, Rickards says the U.S. could get dragged into “asymmetric warfare,” if currency wars lead to rising inflation and global economic uncertainty.

As does Jim Rogers:

Trade wars always lead to wars.

Martin Armstrong wrote in August:

Our greatest problem is the bureaucracy wants a war. This will distract everyone from the NSA and justify what they have been doing. They need a distraction for the economic decline that is coming.

Armstrong argued last month that war plans against Syria are really about debt and spending:

The Syrian mess seems to have people lining up on Capital Hill when sources there say the phone calls coming in are overwhelmingly against any action. The politicians are ignoring the people entirely. This suggests there is indeed a secret agenda to achieve a goal outside the discussion box. That is most like the debt problem and a war is necessary to relief the pressure to curtail spending.

And given that many influential economists wrongly believe that war is good for the economy … many are overtly or quietly pushing for war.

In addition, historians say that the risk of world war is rising because the U.S. feels threatened by a rising China … and the U.S. government considers economic rivalry to be a basis for war

Moreover, former Federal Reserve chairman Alan Greenspan said that the Iraq war was really about oil, and former Treasury Secretary Paul O’Neill says that Bush planned the Iraq war before 9/11. And see this and this. If that war was for petroleum, other oil-rich countries might be invaded as well.

And the American policy of using the military to contain China’s growing economic influence – and of considering economic rivalry to be a basis for war – are creating a tinderbox.

Finally, multi-billionaire investor Hugo Salinas Price says:

What happened to [Libya’s] Mr. Gaddafi, many speculate the real reason he was ousted was that he was planning an all-African currency for conducting trade. The same thing happened to him that happened to Saddam because the US doesn’t want any solid competing currency out there vs the dollar. You know Gaddafi was talking about a golddinar.

Indeed, senior CNBC editor John Carney noted:

Is this the first time a revolutionary group has created a central bank while it is still in the midst of fighting the entrenched political power? It certainly seems to indicate how extraordinarily powerful central bankers have become in our era.

Robert Wenzel of Economic Policy Journal thinks the central banking initiative reveals that foreign powers may have a strong influence over the rebels.

This suggests we have a bit more than a ragtag bunch of rebels running around and that there are some pretty sophisticated influences. “I have never before heard of a central bank being created in just a matter of weeks out of a popular uprising,” Wenzel writes.

Indeed, some say that recent wars have really been about bringing all countries into the fold of Western central banking.


1 Comment

  1. My comment:
    I’ve been reading William Strauss and Neil Howe’s The Fourth Turning: What the Cycles of History Tell Us About America’s Next Rendezvous with Destiny (1997) that predicted a Fourth Turning (“a Crisis, a decisive era of secular upheaval, when the values regime propels replacement of the old civic order with a new one”) would occur shortly after 2005–think 2008 financial crisis. As a result of this event, political and economic trust would implode.

    Within the next twenty years, they expected the States would “pass through a great gate in history, commensurate with the American Revolution [1773-1794], Civil War [1860-1865] and twin emergencies of the Great Depression and World War II [1929-1946]. The risk of catastrophe will be very high. The nation could erupt into insurrection or civil violence, crack up geographically, or succumb to authoritarian rule. If there is war, it is likely to be of maximum risk and effort–in other words, a total war. Every Fourth Turning has registered an upward ratchet in the technology of destruction, and in mankind’s willingness to use it. In the Civil War, the two capital cities would surely have incinerated each other had the means been at hand. In World War II, America invented a new technology of annihilation, which the nation swiftly put to use. This time, America will enter a Fourth Turning with the mean to inflict unimaginable horrors and, perhaps, will confront adversaries who posses the same.”

    They present a fairly convincing argument that historic events occur in regular patterns based upon generational cycles. And, while history may not repeat itself, it certainly does rhyme. And rhymes with a consistent beat and tempo; the Fourth Turning crisis occurring about every 80-100 years, the length of a long human life. Looks like we’re about due.

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