One way of testing one’s understanding of social and spiritual principles is to make predictions and then see if they turn out the way you expect. Here are a few questions that one might currently have in mind.
1) Donald Trump has expressed an intention to expel all the “bad hombres” from the USA. Do you think that the USA homicide rate in 2020 will be (a) higher, (b) lower ( c) about the same as it was in 2016?
2) There is much discussion at the moment about the possible break up of the European union. By 2020, how many countries do you think will have declared an intention to leave the EU? How many do you think may have applied to join?
3) How likely are the following in the next few years: (a) in 2019 the UK leaves the EU with no agreed trade deal in place; (b) cooperation between the USA and China creates a realistic pathway for Korean reunification; (c) Turkey annexes most of the land formerly held by Islamic State.
4) Do you think that in 2020 Bashar al-Assad will still be head of state in Syria?
5) At present the pound sterling is worth 1.18 euro and 1.25 US dollars. Before the Brexit vote, the figures were 1.30 euro and 1.5 dollars. A euro currently buys 1.06 dollars. What is your best guess for the relativity between these three currencies this time in 2018, 2019 and/or 2020? Will you still get more than a euro for your pound? more than a dollar for your euro?
6) Donald Trump will back down from his so far stated position on climate action and global warming - true or false?
Answers to any of the above in the comments section below. Go on, stick your neck out.
Replies
Question 5: Is Trump going to print money?
I wrote elsewhere that President Trump will not manage to have reduced taxes, increased expenditure and falling national (i.e. government) debt all at the same time. Something has to give and listening to his intentions on infrastructure spending I imagine that it will be the intention to reduce debt that will be sacrificed. What will be said is that infrastructure improvements will increase production which will yield more taxes in due course. However, this is only half true. There will, therefore, be a strong temptation to print money to cover the gap. History suggests that this is what populist governments tend to do. It is a simple solution but it produces inflation later. I don’t think Trump is a monetarist (Reagan & Thatcher will turn in their graves). I predict that we are soon going to be back to “boom and bust”. The boom may well get Trump re-elected, but in his second term he is likely to face major economic problems and the world may well lose confidence in the dollar if it falls too far, especially if the US is neglecting foreign policy generally.
Meanwhile, if it can avoid tearing itself to pieces (which I still think it will just manage to do), the EU will continue to plod along with its unexciting yet solid economy inching forward, the ECB becoming ever more powerful, its conservative (i.e. German) approach to money management maintaining stability while other parts of the world gyrate. Although immigration is a political hot potato it is an economic asset and while America is making life difficult for its immigrants, the EU is likely to be putting them to work.
By 2020, therefore, I suspect that the euro will be worth more that a pound sterling (Britain will still be wrestling with the aftermath of Brexit) and quite a lot more than an American dollar. The EU will try to keep the value lower than its natural level but will find it difficult to do so and the euro may well become a haven for international money. The big (hidden) issue will then be whether this inflow of funds can be invested wisely.
All of this is not such good news for me personally since my pension income is in sterling while most of my expenditure is in euros, but I expect I shall mange. In any case, these predictions could turn out to be entirely wrong - the politico-economic world is a rather uncertain place.