Wednesday, 18 February 2009

Russia and China sign $25bn deal

(click headline for original article)
While we all get used to billions and trillions of Pounds, Dollars or Euros being poured into banks or automobile manufacturers to no particular avail so far two long time enemies found an easy way to contract friendship on a meagre £17bn deal. The article hardly made the headlines yesterday but the 20 year contract marks another beginning of an upgradeable partnership where Russia is helped over the <$60 per barrel period while China gets prepared for the next economic competition with energy definitely playing an even more dominant role. China, more energy hungry virtually by the hour will burn all the oil coming directly through pipelines from the wells in highly inefficient but very competitive boilers, trucks and engines to power the world’s workbench supplying the cheapest products possible. With a workforce under enormous pressure from millions of unemployed colleagues and more so from never-been-employed-moving-into-town-farmers labour costs are no issue as is the fact that the same workforce is paid with paper money worth little to nothing on a global scale. We could manage this misbalance if “Globalism had ever gone global”; by allowing some players to apply their own understanding of social welfare and environmental protection, print their own paper money versus collecting and saving hard currencies by the trillions and strengthen the one and only ruling party, the game is not only unfair but dangerous. On a global scale the unemployed Chinese farmer regulates the minimum wage one could work for and the same poor soul’s government has the means to always pay the extra buck on the barrel; leading the competition at both ends. What is left for us? In the end it might be a good idea to print money, get inflation going and devaluate savings. But it still needs strategic thinking to prepare our world for the immediate future’s challenges. Carpe diem


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