s the year end approached, Fitzwilliams, for the first time in three years,
felt more optimistic. Little by little, step by step, the sub-prime crisis had
been attenuated, and the question of sovereign debt seemed to have been
settled. In all, the crisis seemed to have run its course and things would slowly
right themselves. As for his bank the road had been rough, but the changes brought
about by the crisis had benefited what was now the INI Banking Corporation.
The Chancellor promised a growth of almost two percent for 2011, recovery was
on the books and businesses were again functioning normally. On the continent
A
Germany was again in the black, its exports booming. The IMF forecast world
growth at around four percent for the year to come, though it was not optimistic for
the Club Med members of the EU.
John Francis saw things differently. His problem was not to interpret the events of
the past three and a half years, his was to try to predict what the next three and a
half years would bring. The crisis was looking less dangerous, though perhaps they
were simply in the eye of the storm and when its force struck again the destruction
would be even worse. There was the risk that the storm would return in the form of
a more severe sovereign debt crisis, more specifically centred on the euro.
There were many theories and explanations bandied about by the experts,
amongst them was the notion of super cycles. According to United Nations’
economists, these were composed of upswings of ten to thirty years, with full
cycles ranging from twenty to seventy years. This vision was based on the
observation of commodities, and more notably the demand for metals.
They concluded that the relationship between metal prices and world GDP
followed a similar pattern. This explained the ongoing super-cycle conformed to
type, driven almost entirely by industrial expansion in China and emerging
markets, which in turn drove the boom in commodity prices. This cycle could only
last if China was capable of disconnecting from the long period of slow growth
forecast in developed economies, which seemed highly unlikely given China’s
dependence on exports, which meant the world was looking at a long period of
stagnation, if the theory proved to be correct.
After his recent visit to China, Francis was less concerned about China’s specific
case, or its tug of war with the West. What troubled him was the changes man was
making on his natural environment and how they would affect the West’s
economy, and more precisely Fitzwilliams’ bank in the coming years.
In an even larger picture, his eminent colleague at Stanford University, Ian Morris
had just published his book entitled Why the West Rules…for now. As an
archaeologist, classicist and historian, Morris had set himself the ambitious goal of
trying to understanding the future through the past.
The historian’s conclusions were less complacent than the Imperial Chinese
encyclopaedists who had produced the Complete Collection of Illustrations and
Writings From the Earliest to Current Times, published in 1726 during the Qing
dynasty, who attempted to document ‘everything under heaven’ in over five
thousand volumes, eight hundred thousand pages, and one hundred million Chinese
characters.
Morris’ conclusion went beyond specific cases and focused on the problems
facing humanity as a whole. Which seemed to Francis more important than the
result of the race between the West and its competitors. Whether the Chinese
economy overtook the West did not change much for Fitzwilliams' bank, which
could continue to function and make money. On the other hand the appearance of
Morris’ Five Horsemen of the Apocalypse: climate change, migration, famine,
epidemic and state failure spelled chaos, threatening the entire planet’s economic
well-being.
Francis could only agree with the idea that man would end up being punished by
the gods, as had Prometheus, for stealing fire from the heavens for men. He feared
that mankind in its unsustainable race for growth and development was in effect
playing with fire.
Nuclear proliferation, population growth, energy consumption, food demand and
climate change were in the process of fundamentally changing old historical
patterns. A watershed separating the past from the present had been reached and
what happened next was unpredictable.
Francis feared that the historian’s conclusions were prophetic: a choice between
‘Singularity’, salvation through collective governance, and ‘Nightfall’, a world of
Mad Max.
Mankind was perhaps facing a turning point, one that was totally different to
historical choices and where geography and civilization were totally irrelevant,
where one false move, by a mad dictator, could lead to Götterdämmerung. The
question was where and when?