As a kid growing up, we had a rather idyllic life. There were few worries, abundance of everything, and opportunities galore. Time had few constraints. As an adult, trying to find a way that works, only to be confronted with some pretty serious realities. Those moments too do pass. And a new path is sought. A new rhythm is established.
There is no shortage of opinions and perspectives on the current state of the world. Some of the talk is getting louder. Some opinions include that we will soon breach a threshold that will unleash some rather ugly predictions. My schooling in the markets now almost three and a half years running has provided a rather in depth look at what some of those circumstances are and what some believe the outcome might be. More importantly, it has also taught me patience, nothing is actually as it seems, and no one really knows what the approaching times will bring.
But the purpose of this post is none of the above although it does offer an appropriate backdrop - some perspective. This post is about the realization that if it really gets as ugly and difficult as postulated - this will be a very strong dose of reality. We have lived through a very prosperous period with growth and the generation of a lot of wealth and in most sense a peaceful existence. Circumstances are changing. Jeff Rubin’s Why Your World is About to Get a Whole Lot Smaller: Oil and the End of Globalization is a great book providing his view of the world in triple digit oil prices and economies refocused on domestic trade - the world will be getting smaller. Our world became globalized on the proliferation of energy production in all forms. And in a relative sense, cheap energy. The world has gone through a series of advances in the evolution of energy use. Each time, circumstances became necessary of change. And in some cases, serious change occurred. It seems like we could well be in one of those moments. A moment in earth's 4.5B year old history, that will get recorded as a significant event. An event that could well change the course of our existence.
And as an adult, as opposed to the child watching the man walk on the moon for the first time in 1969, one's awareness of these seminal events is very different. It has a much greater degree of seriousness, acuteness, finality. It is with a rather stark realization that the incredible interconnectivity, worldwide, is grand, but also scary. The production of automobiles in North America, held up by a striking parts manufacturer in India. The shipment of raw materials to China from mines located around the globe, and turned in steel and other products, and again shipped around the world. The capitalistic machine that this world is ======> is massive.
And vulnerable. A lot of working parts. Built on a foundation of property law and trust. Much of that trust has been broken. Across so many aspects of our daily activities. A market. A market in anything is made up of one buyer and one seller. And an agreed to price. All three must be present to have an active and vibrant market. Remove or alter any one of the three and markets change, rapidly. Adjusting to the mean, just as our life's cycles evolve.
And these changes could be very real, not the carefree life that I have experienced to date (ok - with its bumps .... but you know what I mean). Get small. Eliminate debt. Be more self-reliant. I will be watching closely to gain a sense of what might happen and when. And in the meantime, be grateful for the 84,600sec that are deposited in our accounts each and every morning. Spend your time well!
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