Global Collapse, Thy Name is Venezuela

The globalist dominoes are beginning to fall.

The dominoes have been set up.

The first one has already been tipped over.

It is already expected that a full thirty percent of the world’s grain supply has been taken off the market due to Russia’s invasion of Ukraine.

China is buying up grain at a record pace.

Here in America, farmers are looking at a very expensive, perhaps prohibitively so, planting season. Fuel, fertilizers, insecticides, and herbicides are all skyrocketing in price while drastically falling in supply. Some farmers I personally spoke with say they will have to reduce the acreage they plant; some are considering not planting at all.

While people may be able to withstand inflation and fewer choices in their local grocery stores, nobody can withstand a complete lack of food.

No doubt energy is a critical factor in everything we do, especially hydrocarbon supply. Hydrocarbons are truly a miracle material, providing both the raw material AND the energy needed to convert that raw stock into a myriad of necessary products – but the processes and mechanisms needed to convert that raw stock are also supremely important.

And guess what?

On the list of production of nitrogen fertilizer, the US ranks third. China is number one with a bullet, producing over three times the amount.

Needless to say, much of China’s fertilizer production is sold back to the rest of the world, primarily the US.

It is a rare thing that you can pick up an article of your own clothing that is made in the United States. We have known that to be true for a generation.

America’s globalization traded our security for cheap labor. We closed our factories and shipped the means of production overseas, and in many cases, to countries not really that friendly to us. They loved the American dollar, America – not so much.

But even countries like China are vulnerable to immutable economic laws. It has been said that China has become the world’s factory, and that is a legitimate claim, but the fact remains that they do not have the raw materials to support their own factories.

According to the Observatory of Economic Complexity (OEC), an outgrowth of a project at MIT, the top exports of China are all manufactured goods - Broadcasting Equipment ($208B), Computers ($141B), Integrated Circuits ($108B), Office Machine Parts ($82.7B), and Telephones ($54.8B). Imports are dominated by raw materials – as recently as 2019, China was the world's biggest importer of Crude Petroleum ($204B), Iron Ore ($83.1B), Petroleum Gas ($47.8B), Soybeans ($32.1B), and Copper Ore ($31.3B).

When the advantage is converting raw materials, if the supply of raw materials is interrupted, your advantage is worthless.

The table is being set for a cascade of failures that could very well lead to a world of hungry people, for a time when it doesn’t matter how much money you have because there is nothing to buy at any price.

One of the greatest criticisms of our foppish and feckless people is that they don’t know history – my modification that criticism is, I believe, more accurate. It is not that they don’t know history, it is that they simply choose to ignore it, preferring to believe the comforting (but false) idea that “it can’t happen here, and it can’t happen to me.”

But history books are not needed because the world has had a front row seat to a demonstration, in real time, of what is to come.

Global collapse, thy name is Venezuela.

Venezuela is the culmination of a death spiral created by the same communist theories and sympathies that form many, if not most, of the policy and legislative motive forces in the American Democrat Party. As with Maduro, and Chavez before him, the collectivist desire for state control over everything resulted in not only the destruction of access to raw materials, it also resulted in the near complete eradication of the ability and capability to produce anything for its own people.

Venezuela is a resource rich nation ruined by skyrocketing debt, bad financial policies, destructive industrial programs, general incompetence, and corruption in government. Public utilities – electricity, natural gas, clean water, sanitary sewers, road maintenance – began to degrade, were propped up for a time by the state, but eventually disappeared, leaving much of the population with little to no access to food, water, waste disposal or transportation. Not even the cheapest subsidized gasoline prices (around a US dime per gallon) in the world help people who don’t have jobs, cars, or passable roads on which to drive them.

Venezuela has gone from one of the most prosperous countries in the world to one of the most destitute within a single generation. It has also gone from one of the freest to one of the most controlled.

That Venezuela still exists is largely due to “lenders of last resort” propping them up.

But what happens if, in a global depression, there are no “lenders of last resort”.

If you still think “it can’t happen here”, good luck to you – because it already is happening.

Inflation is reducing the value of every unit of fiat currency you have in your pocket and every digital notation you have in an account at your bank. Please keep in mind that while inflation increased the price you pay, it also decreased the value of every dollar you have. It is being hidden a bit today due to “shrinkflation” – where producers are holding prices but cutting the volume per unit of content – but it is there.

You may think that cutting Russia (and Canadian truckers) off from the financial system is a form of punishment, but it is also a form of control and a method to stop runs on financial institutions.

Collapses of this magnitude are almost always a culmination of a long cycle of poor decisions combined with bad leadership and an apathetic public, just waiting for triggering event.

America may well not have a dog in the Ukrainian hunt, but a loss of thirty percent of global grain production WILL have an impact on us.

I generally take a pessimistic view of both American and global leadership, largely because they are typically either idiots or megalomaniacs with delusions of grandeur - or both, HOA presidents and boards on steroids.

Rush Limbaugh used to tell us that it is not time to panic, it is time to prepare. I’ve always understood that the prepared never need to panic, while those who panic do so because they didn’t prepare. I believe the latter has never been truer than today. I also believe the time for the former is closer than ever.

It is time to focus on your family and their needs. Time to prepare for worthless currency and extreme shortages of necessities.

If I’m wrong, all it means is that you won’t need to go to Sam’s Club or Costco for a few months.

If I am right?

Well, you know the thing.