Summary

Niall began by outlining 4 major trends. The first is Globalisation which peaked in 2007 and has been declining since. It will not reverse. Secondly, we are currently in cold war 2 which is different from cold war 1 in that China is now senior partner to Russia. Thirdly, the era of low inflation is at an end due to monetary and fiscal errors resulting from the pandemic. The final major trend, which is less understood, is constant technological changes, including the transition from web 2 to web 3 which is very transformative in the broad sense and specifically in the financial world. In some ways this trend will be more historically important than geopolitical issues. Moving to the current crisis, Niall expects a final phase to play out in coming weeks as Russia focuses on the east of Ukraine. Russia could grind out a pyrrhic victory by early May. Do not expect meaningful negotiations until then as Russia needs to gain more influence. Sanctions have not been effective as Russia is still able to sell oil and until an oil embargo is in place that will not change. However, Niall does not see this occurring. China will not mediate or act as peace brokers. They will give enabling support to the Russian war effort, but not enough to warrant US sanctions. Niall expects the public to lose interest in the war as inflation becomes the dominant issue. The Biden administration is making little effort to shorten the war – as it continues there are unintended consequences/adverse implications – not just energy prices, the real issue is food prices – a huge number of countries rely on Ukraine and Russia for wheat and fertiliser, this will cause global inflation shock comparable with the 1970’s, and will create instability in some countries reliant on Ukraine and Russia. The probability of nuclear or chemical weapons goes up the worse Russia do in the war. Russia may resort to using WMD to salvage the situation. Ukrainian success could lead to ruthlessly extreme measures by Putin.

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