OBSERVATION: What Awaits in 2020 - Watch Out for These Black Swans

Here are the top 20 black swan incidents that are most likely to disrupt global economies and international relations in the new year.
Xu WuDec 03,2019,03:57

In 2020, it will be written into the annals with a historical turning point that subverts the past—

The Sino-US trade war that has lasted for nearly two years: Finally, in 2020, China and the United States and the world economy have suffered huge and irreversible political and economic pains and costs. There will be a bitter fruit that cannot be swallowed;

In the general election years of dozens of countries and regions in the world, the multinational presidential elections led by the United States will falter through political traps in scandals, impeachments, conflicts and even constitutional crises;

From the perspective of Western astrology, 2020 will be the starting point of the three major planet recurrence cycles. These include Saturn, a sign of crisis and warning, and Pluto, a sign of control and turbulence. The last time this short-term multi-satellite gathering occurred was from 1881 to 1882 over a hundred years ago.

In 2020, the globalized trains that have been advancing rapidly for more than 30 years after the end of the Cold War will decelerate and derail quickly, entering a slow path of economic protectionism; meanwhile, observe this with suspicion and hostility Two years of Chinese and American popular sentiment began to irreversibly slide towards the cold ice cave. The ultimate severing of Sino-US relations is not based on rational analysis and thoughtfulness, but more on collective unconscious irrational impulses and the wild spirit of animals. As former US Secretary of State Kissinger warned at the just-concluded Beijing Innovation and Economic Forum, the separation between China and the United States, if not resolved, will have more negative consequences than the two world wars that ravaged the world in the twentieth century.

      Western proverbs said"No snowflake in an avalanche ever feels responsible." Similarly, the old Chinese saying goes, "A bird's nest dropped on the ground will not have a perfect egg." For many companies facing the ever-changing market at any time, it is no longer enough to simply talk about the public relations discourses such as "reviewing the current situation and preparing for the future" on the key points of the historic change. It is necessary to use the most cautious attitude to make  "Worst-case scenario building" and the strongest stress test, ready to deal with that black swan that only flew from different corners.

        Below, based on the new geopolitical changes in the world, and based on objective enabling conditions and subjective speculations, this column lists the top 20 "black swan incidents" that are most likely to disrupt global economic operations and international relations in 2020. Its ranking not only takes into account the possibility of the crisis event, but also takes into account the actual harm caused by its actual occurrence.

Of course, no one can truly predict the future, let alone identify these potential events fairly within the 366 days of the coming year. As the famous American baseball player Bella said, "It's tough to make predictions, especially about the future." In view of this, the following 20 crisis scenarios are not alarmist, but should be said to be bona fide Early warning.

1. The Sino-U.S. Trade war continues to worsen. On the basis of the original increase in tariffs, the governments of both sides have increased the punishment of each other's business entities. At the same time, consumers in both countries have begun to boycott each other's products on a large scale. In addition to high-tech companies, the consumer goods and services industries of China and the United States have also been involved in the intensifying trade war between the two sides.

2. The turbulent situation in Hong Kong has not substantially eased, the economy is in recession, and the people are full of grievances; With the withdrawal of a large number of international funds from Hong Kong, the Hong Kong dollar and Hong Kong stocks have crashed, causing property prices to plummet, and then a wave of financial crisis that has spread to the world .

3. Just after the New Year of 2020, North Korea announced that it would suspend nuclear negotiations with the United States and restart nuclear tests and strategic missile tests at the same time. The Trump administration has announced comprehensive sanctions and has frozen all banks and financial institutions related to North Korean trade. Many Chinese banks were the first to be put on the list of sanctions, and their normal operations encountered major troubles.

4. Due to the global economic recession caused by the trade war between China and the United States, the spring of 2020 will have a significant negative impact. The trading market mainly based on the US stock market experienced an instant "flash crash" similar to 1987. Global stock markets and bond markets plummeted in a short period of time, which triggered a global financial crisis.

5. "Impeachment Trump " triggered a constitutional crisis in the United States, which led the two parties to oppose each other on major issues, and the government closed down. At the same time, in order to fight for voters, candidates from both parties kept targeting China.The United States and China are moving towards comprehensive cutting and the cold war.  

6. Against the background of the stalemate in the Sino-U.S. Trade war, the US Congress and federal agencies have passed bills prohibiting U.S. pensions and federal government funds from investing in "Chinese stocks" and companies with Chinese backgrounds; Listed companies must disclose their government-linked background, and many Chinese companies face penalties and risks of delisting.

7. Deutsche Bank was exposed to deliberately cover up a large amount of losses, which was essentially insolvent and on the verge of bankruptcy. The resulting interbank chain reaction is just like the global impact of the 2008 Lehman Brothers collapse. The Federal Reserve and the European Central Bank have launched emergency mechanisms to stabilize international financial markets, but with limited results.  

8. The out-of-control interest rate of U.S. interbank borrowing in September 2019 will reappear in mid-2020. Although the Federal Reserve once again injected a large amount of funds into the market, it will not be able to stabilize interest rates in the short term. Within a few days, a number of international banks experienced shortages of funds and run-outs, and the international financial market was instantly frozen.

9. There is a fierce confrontation between the navies of the United States and China in the South China Sea, which leads to major accidents such as ship collision and casualties of officers and soldiers. Both sides have their own opinions. The United States mobilizes aircraft carrier battle groups to gather in the South China Sea, and China and the United States are faced with the possibility of firing. International trade routes through the South China Sea have been greatly affected.

10. Iran ’s domestic turmoil has developed into a national riot under the intervention and provocation of the United States; the Iranian government announced the blockade of the Persian Gulf, and the international oil price broke the US $ 100 per barrel limit in an instant. Neither side has yielded, and the Middle East is once again mired in terrorism and turmoil.  

11. The abrupt climate change in the second half of 2019 will directly cause a global food and meat shortage in 2020. The swine fever epidemic in China has not only eased, but has spread to other Asian regions; rising prices have triggered a round of inflation, which has led to a sharp fall in house prices and a series of social unrest.  

12. Brexit finally came to fruition after several delays, but its negative impact on the British and EU markets gradually became apparent; the pound fell sharply, and the European Central Bank tried again to boost the economy through quantitative easing negative interest rate policies, but the actual effect was limited. The German and French-based EU economy is in recession.

13. After the Taiwan election in 2020, the DPP will continue to govern, and under the influence of the US encouragement and the turmoil in Hong Kong, it will publicly abandon the "One China Consensus" and move towards the road of substantial Taiwan independence. The mainland deployed military forces to block Taiwan's maritime passages to deter Taiwan independence forces, which led to the assembly and confrontation of Sino-US military forces in the East China Sea.

14. The over-expanded federal government debt of the United States (23 trillion U.S. dollars) has caused international markets to sell U.S. Treasury bonds; the intervention of the Federal Reserve has not dispelled concerns about the financial status of the U.S. federal government in the international and domestic markets; US stocks and global financial markets entered a downward spiral.

15. The wave of "anti-globalization" populism will sweep the world in the spring and summer of 2020; including France, Britain, Chile, Venezuela, Egypt, Spain, Lebanon, Iran and other countries, there will be large-scale anti-government And anti-globalization demonstrations. Chinese-funded enterprises and foreign agencies have become targets of this wave.

16. The 2020 U.S. election results are stalemate. Although Trump lost to Democratic opponents with a slight disadvantage, Trump refused to acknowledge the legitimacy of the election results and refused to surrender the presidential power. During the US Supreme Court ruling, large-scale riots and attacks occurred in the country, and the United States fell into the most chaotic situation since the Civil War.

17. Because of major constraints on Hong Kong, Taiwan, North Korea and other issues, China and the United States have been unable to reach an understanding and reconciliation through diplomatic means. In the context of the trade war that has suffered both, the United States has begun to use the SWIFT system for international dollar settlement. The US dollar trade and contract settlement of Chinese-funded institutions and enterprises have been partially frozen and blocked. The financial war between China and the United States has officially started.

 

18. Before the 2020 Taiwan elections began, the United States sold offensive weapons to Taiwan on a large scale and sent high-level government officials to publicly stand for the Taiwan Democratic Progressive Party. After China's repeated warnings were invalid, China launched the "Anti-Secession Law", drawing a red line with the United States on the Taiwan issue. Bilateral relations are moving towards open hostility. 

19. Europe's immigration and refugee problems intensified again in 2020, with mass xenophobia in several countries; at the same time, a wave of terrorist attacks has heightened hostility among ethnic and religious communities. Overseas Chinese groups and Chinese-funded institutions have been hit.

20. An epic natural disaster (California earthquake) or the assassination of a major country leader (US, Russia, China) has instantly changed the prospect of international economic development or shaken the general pattern of international relations. Making 2020 a watershed year in human history.

let us wait and see. Twenty seemingly fledgling ducklings, how many can grow into flying black swans.

Let's count again at the end of 2020.


Topics:OBSERVATION: 2020 - Watch Out for These 20 Black Swans
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