Hi all,

Apologies for the long delay in posting, its been very busy the last few months.

Here are a few of my thoughts in terms of what has happened recently:

US elections: the forced removal of President Biden as the Democratic candidate after his disastrous debate performance and replacement with Vice President Harris has transformed the race. Harris has now caught up with Trump in the critical swing states and the respected Nate Silver pollster has called it a tied race now.

Based on fundamentals, e.g. the top two issues that voters care about, the economy and immigration, Trump should still narrowly win this election. However, Harris has clearly energised parts of the Democratic base, in particular Blacks, young voters and women.

If you put a gun to my head, I would say either candidate can win but Trump should edge in the electoral college in November, after the honeymoon phase ends for Harris in the coming months. Do I have a strong conviction about this? No, so there you go.

US economy: markets are now getting concerned about prospects for economic growth in the US. My take is earnings reports all show that US consumers are cutting back on discretionary spending e.g. nice to haves and that is a trend that will continue in the years and decades ahead. This is a global trend which is why anyone invested or involved in businesses that gear to nice to haves versus necessities should reconsider their jobs/careers.

At a global level, my best estimate is nominal growth will die in 2026/27 and the world will tip into economic contraction (in nominal not just in real terms) in the late 2020s, triggering a massive collapse in global assets at the end of this decade.

Europe: Russia continues to make incremental gains in the east of the country and I see no reason to change my outlook that Russia will fully gain the Donbas this year, will make further gains into Kiev and Odessa in 2025 and a collapse of Ukraine will happen in 2026 unless a peace deal emerges next year.

Either way, a Russian victory in this war will transform the post-Soviet security architecture in Europe and galvanise those wanting to end the American dominance of the world. So, either way, I expect the half of the 2020s to be a dangerous time geopolitically not just in Europe but in East Asia, Middle East and the Caucasus.

So, my longer term outlook remains the same for Europe, wars are coming (concentrated in the Balkans and eastern Europe but likely to spread over time) and, in a generations time, once demographic trends continue, rising tensions between the Muslim minority (who will be majorities in a few European cities by the 2040s – e.g. Birmingham etc) and the non-Muslim populations.

What will make this growing cleavage particularly dangerous is the fact that climate change is making much of north Africa and the Middle East increasingly hard to live in for large scale populations. Its a matter of time, probably within a decade or so, before populations in those regions conclude they have to move to more hospitable climates and Europe is the obvious choice.

Based on my reading of the data, the 2040s and 2050s look like the period when large scale invasions from Africa and the Middle East will start in earnest, around the time that demographic trends lead to a large plurality, and in some cities, majorities, of young men being Muslim. You don’t need to be a historian to work out what happens next, civil wars and external invasions that transform much of Europe into an Islamic empire.

Or as Greer recently said, “As for barbarian invasions, nah, this is just the warmup exercises for that. I recommend reading a good account of the barbarian invasion of Gaul in 406-407 if you want a sense of what’s on its way: that is to say, not a modest flow of refugees, but massed armies and the overthrow of governments. You’ll know the next round is well under way when the last president of France is hiding out in Canada and the Islamic Republic of al-Faransa has just been proclaimed in Paris.”

On that positive note enjoy the weekend!