Five
Trends That Will Change The World in 2016
MorningStar Prophetic Bulletin #96 -
December 14, 2015
Rick Joyner
A geopolitical shift has taken place
at the end of 2015 that could change the world more than we have seen since the
collapse of the Iron Curtain. Core beliefs and values are being challenged
across the globe. With such a major change of direction happening, where are we
headed?
The following are the five major
events that will likely define our immediate future and impact world affairs
for the foreseeable future. These are listed in the sequence they occurred, not
necessarily the sequence of importance or impact:
1) China stock market crashes
2) Falling energy prices
3) Russian military intervention into the
Middle East
4) Paris and San Bernardino terrorist attacks
5) The Trump candidacy
We will look at each of these for the
message they have, but first we will briefly discuss the most basic change
factor in world affairs—initiative. In military operations and world affairs,
having the initiative is necessary for success. The one with the initiative can
control the battle or geopolitical situation, requiring their opponent(s) to
react to them rather than the other way around. Therefore, those with the
initiative have a major advantage in the confrontation. For this reason, the
most important factors to look for to discern the nature of events and where
they are heading are:
1) Who has the initiative
2) What are their intentions or goals
3) What are their resources and strategies for
sustaining the initiative
Now we’ll look at each of the five events
having a major impact on the world and their potential consequences.
The China Stock Market Crash
China’s economic growth has been a key
factor impacting the world economy this century. Without it, the recovery after
9/11 or the crash of 2008 would have been more difficult, if not impossible.
China is now one of the biggest economic forces in the world, rivaling the
impact of both the U.S. and Europe.
Factors:
On June 12, 2015 The Shanghai Index
lost one third of its value. It rebounded, but this began the most turbulent
volatility of a major market possibly in modern times, even eclipsing the 1929
crash. Understanding its cause and impact on the world economy is important for
understanding what we can expect the world economy to do in the foreseeable
future.
One report estimated that one hundred
million Chinese investors were virtually wiped out in a day. Many more than
this number was also severely hurt by this crash. The Chinese economy had
produced more millionaires and billionaires and created and expanded a middle
class faster than any economy in history. It delivered more people out of
poverty in a shorter time—a truly remarkable achievement.
China also created a huge number of
consumers that drove industry around the world. The June crash, dramatic
recovery, and then a worse crash over a few week period unnerved more than the
Chinese—it alarmed everyone who understood the interconnection of world
economics. This will no doubt majorly impact the rapid growth of the Chinese’s
purchasing of the world’s goods, with huge ramifications.
The Western media hardly covered this
remarkable event, possibly because only about 1.5% of Chinese stocks are held
outside of China. Another reason is China’s control over its media. In the free
media, panic can be created and driven by the media. China clamped down on
their media, likely preventing a far worse catastrophe. They also quickly shut
down trading by major companies and stockholders.
This strategy can work in the short
term, but the lack of transparency also breeds suspicion, long-term concern, or
fear that can hurt a free market even more. The Chinese leadership is smart
enough to know this, but the potential for catastrophe in the short term was so
great, they felt they had to take drastic measures.
Chinese authorities blamed the crash
on rumors and fear mongering. If true, fear and rumors will be a continuing
problem for the Chinese without transparency. Their markets stabilized because
of the controls, but when those controls were lifted a little, the markets fell
another 40%. They’ve recovered some, but the factors that initiated these
shockwaves have not been addressed—the lack of transparent accounting and the
true value of their currency, the Yuan, that was arbitrarily set by the
government.
Although it’s impressive how well the
Chinese government handled the crash without prior experience in anything like
this, the IMF’s recent decision to designate the Chinese Yuan a reserve
currency seems to be more political than economic. This was likely a move to
help stabilize the Yuan, but this too could have a destabilizing effect on
other world currencies—we’ll see.
It is no secret that the Chinese would
like to see their currency replace the dollar as the world’s top reserve
currency. Even with their problems, they are headed that way because of the
over-regulation and over-taxation shackling the U.S. economy.
BOTTOM LINE:
This will not likely bode well for the
U.S. dollar or economy. The potential effect of the Chinese market turmoil to
destabilize the rest of the world is substantial. Again, Chinese economic
growth, and the creation of such a huge middle class and consumer base, may be
the single biggest factor sustaining the world economy after the 2008 crash.
Basic economic indicators point to increasing weakness in the world economy at
a time when one of its biggest economic engines, China, will slow down.
A slide into a recession in 2016 looks not
only possible, but seems inevitable. The recovery since 2008 would not likely
exist with China, and it has still only been a shallow, weak recovery. Now the
world cannot count on growing Chinese consumption to bail them out.
The turmoil in China will impact the
world economy negatively by slowing its consumer spending. At the same time,
China is seizing the initiative to become the world’s reserve currency, giving
them increasing leverage over the world economy. This is not the result of
strength in their economy as much as Chinese leadership and decisiveness. As
Donald Trump accurately pointed out, “Their leaders have been smarter than
ours.”
Without a major change in U.S.
economic policy, China is in the best position to take and hold the initiative
in world economics for the foreseeable future. This is happening in spite of
the fragile nature of the Yuan. Chinese equity markets have more to do with the
incompetence of U.S. and European economic leadership than brilliance on the
part of the Chinese. That China has seized the initiative in the world economy
after suffering such dramatic turmoil in its own economy is a clear indication
of the kind of jeopardy the world economy is in.
Falling Energy Prices
Along with the growth of Chinese
consumerism, falling energy prices have been a major driver of the world’s
economy in recent times. The effect has been like having a trillion dollar
stimulus infused into the U.S. and E.U. economies each year. Combined with
“Quantitative Easing” (QE), the artificial dumping of almost another trillion
dollars into the economy each year, the U.S. economy is just barely inching
along, indicating how gummed up the works are in our economic engine.
Falling energy prices may have bought us more
time to fix serious issues in the economy, but without decisive leadership that
will actually fix things, we will inevitably suffer the worst economic disaster
in our history. Falling energy prices are mostly the result of falling demand
for energy, a sure sign that much of the world’s economy is weakening.
Russian Intervention in the Middle East
Russia’s economy has been devastated
because it is a petroleum-based economy, and falling energy prices have it near
collapse. However, Putin has emerged as the most decisive world leader. He has
seized initiative in world affairs and become a major player in world
economics.
Putin’s move into the Middle East was
not just about propping up the Assad, a man Putin has shown distain for, in
Syria. Neither is his alliance with Iran the result of his love for that
regime. He has brilliantly positioned Russia to use both of them in a bold move
to threaten Saudi Arabia and the other oil producers in the region. This will
drive up oil prices, thereby saving the Russian economy.
This is bold and brilliant, and a
decisive man like Putin will likely carry it out. The recent shooting down of a
Russian plane by Turkey gave him more cards to play. Cutting off Russian
tourism to Turkey can devastate that country’s economy. It also has the
potential to create major turmoil in NATO, ultimately securing the Russian
southern flank by bringing a capitulating Turkey under Russian control. Putin
is smart enough to play the cards he’s dealt, and it's not likely the
Russian/Turkish crisis will go away until Putin has gained a great deal.
Another factor is that almost all NATO
countries are dependent on Middle Eastern oil. If Putin is ambitious (and he
seems to be), he could break up NATO and bring many of the nations under
Russian influence. This would force the E.U. to stand down and not interfere in
his actions against Ukraine or other former Soviet states while freeing him for
other adventures.
America alone has the power to counter
Putin, but his decisiveness combined with the ineptness of American leadership
could not be setting the tables better for him. The U.S. and Canada could now
be producing enough energy to support the E.U. so that it does not have to
depend on Saudi Arabia or Russian energy sources, strengthening NATO at a time
when it is increasingly needed. Policies like killing the Keystone Pipeline
could have bad consequences. At the very least, this will likely prove a major
missed opportunity strategically.
BOTTOM LINE:
Expect energy prices to rebound in
2016, though they could drop even more before this happens because of the
weakening world economy. When they start back up they could return to previous
levels faster than they fell. This will be like a reverse of the stimulus at
the worst time for Western economies, wreaking economic havoc on the U.S., the
E.U., and many other countries.
Russia does not need energy from
outside sources, but they do need the price of energy to go up. China is
desperate for dependable and cheap energy. They did not join Putin’s Middle
East adventure without a purpose. China will likely soon have virtual control
over Saudi Arabia as part of this deal.
Understanding the power of the
Russian/Chinese alliance combined with weak American resolve has much of the
world looking to Russia and China for leadership. The end result could be the
worst economic disaster in history for the U.S. and the E.U. At the same time,
Russia can get back on its feet economically and China will be the most
powerful economic force in the world as the stable source of cheap energy (for
them).
Together, Russia and China are
systematically and effectively seizing the initiative in the world economy, and
by that world affairs. No other leadership in sight can counter it. This is the
extraordinary geopolitical shift now taking place. Its implications are as far
reaching as the fall of the Iron Curtain, but this time to the advantage of the
former communist states. This leads us to the fourth factor to have a major
impact on the trajectory of world affairs.
The Paris and San Bernardino Terrorist
Attacks
How could such evil deeds by as few as
ten people have such an impact on world affairs? Because there is a vacuum of
leadership. When President Obama used the extraordinary platform of a
prime-time Oval Office address to virtually say nothing except what we
shouldn’t do, this increased American jitters, and rightly so. It seems every
move the Administration makes to calm people is counterproductive. This is
because most people are smart enough to understand the politicians try to come
up with politically correct and expedient solutions instead of a real strategy.
Even so, the Paris and San Bernardino
attacks did a lot to wake up the people. This awakening is helping to throw off
the delusions of unrealistic idealism and political correctness. This is
crucial for sustainable war that will defeat ISIS and other groups whose
primary strategy is terrorism.
Although French and British leadership
are waking up some, it is an awakening among the people that is creating a
sharp turn to the right in Europe. Putin has chastised Europe for its attempt
at multiculturalism, what he called “cultural suicide.” More Europeans are
agreeing with him. Now not only Europeans but also the American people see
Putin as the leader most capable of defeating ISIS and other terrorist
organizations.
BOTTOM LINE:
As the saying goes, “If you do not
change your direction you will end up where you are headed.” This is where the
world is now headed—a major economic slide in the West along with a
corresponding decline in leverage in world affairs. This has the potential to destabilize
populations because of the government’s failure to provide security and
defense—its most basic responsibility.
The U.S. still has the most powerful
economic engine in the world, but as previously stated, overregulation and
over-taxation has gummed it up. Without leadership that changes both of these,
America will continue its economic decline with the increasing probability of
the European Union fracturing and likely NATO disintegrating. It will take the
most extraordinary leadership in our history to seize the initiative from the
powerful Russia/China partnership.
This leads to the fifth major factor
impacting the pivotal year of 2016.
The Candidacy of Donald Trump
It is probable that you either really
like Donald Trump or really don’t, but his candidacy helps us understand the
times like few things can. Like him or dislike him, his candidacy is a
revelation of the times we neglect to our peril.
We hear the media pundits say almost
nightly, “the American people want this (or that)” when it’s obvious they are
out of touch with the American people. This is likely because they are trying
to project onto them what they want. It may be their job to understand current
events, but the people with real jobs don’t have the time to want much depth.
They often want the bottom line and to trust their leaders to know and take
care of the details. This is why simple messages like “hope” and “change”
worked so effectively.
What almost everyone does seem to know
is that we’re like a ship without a rudder when it comes to the most important
and threatening issues. In times of confusion and chaos, people gravitate to
strong, decisive leadership. Like him or not, Trump is the kind of person
people turn to in such times.
It was recently reported that in one
day there were about 2,500 mentions of all of the candidates combined,
excluding Trump. On that same day, Trump was mentioned almost 65,000 times. That
was media dominance by a candidate never before seen. Even though a lot of this
coverage was negative, it got Trump’s message out. He was almost totally
controlling the conversation.
Like what Trump says and stands for or
not, he projects decisiveness unlike the other candidates. In times of peace,
likability is often considered a better quality for a candidate. In times of
war or crisis, strength and decisiveness will almost always win. That’s why the
U.K. so despised the pugnacious Winston Churchill during times of peace, but
almost all turned to him when war became inevitable.
One more terrorist attack on American
soil like the one in San Bernardino and Trump could be a shoo-in for the
Republican nomination. With the way events are trending for 2016, he could be
our next President.
Depending on your perspective, this
scenario presents either the greatest opportunity for the U.S. to retake the
initiative in world affairs and economy, or it presents the greatest danger.
Coming events will clarify which it is, but conditions are careening toward the
time when strong, decisive leadership that can seize the initiative will
dominate our future.
There are other factors also affecting
current events and trends. Many of them could arise to become a major one, but
at present, this is a brief evaluation of major trends from the natural
perspective. In the next Bulletin, we will cover the spiritual.