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In a speech to 3000 party officials Xi Jinping says it is the "central and united leadership of the party that made possible this historic transition." He was speaking at the 40th anniversary of the Deng reforms to open up China's economy. He said China was right to have "lofty aspirations." Yet he said China "would not sacrifice the interests of other countries," while preserving its own interests. The speech comes as China is trying to find a way out of the trade tensions with the U.S. through negotiations. The U.S. sees China in the same way that it saw Japan's rise as an industrial power in the 1980's. and seeks to preserve U.S. economic strength and balanced trade relations that give no unfair advantages to Asian competitors. The U.S. negotiating team is led by the same negotiator who led the team that negotiated for the Reagan administration with Japan-Robert Lighthizer.

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One negative effect of the trade war with the U.S. is an increased emphasis on energy security and increased use of coal in China. After China committed to goals for climate change coal use declined in 2014, after reaching a high in 2013. The attack on Saudi oil facilities showed risk in its reliance on Saudi oil. China's import dependency for oil reached an all time high of 72% in 2018, according to BP 2019 Statistical Review. Gradually the commitment to climate change and lower use of coal has changed since 2016 with the withdrawal of the U.S. from the Paris Climate Change Agreement. Initially after the U.S. withdrawal under president Trump China made bold commitment to lead the fight against climate change but has since wavered. In an October 2019 speech Premier Li Kequiang called for the development of the coal industry to ensure energy security.  As China's economy slowed in 2019 in the face of U.S. tariffs and a trade war with the U.S. efforts are being made to increase infrastructure investment which has driven coal use higher. China's steel output reached a record of 750 million metric tons in 2019. The amount of coal fired capacity under construction in China now exceeds the rest of the world combined, much of it from plants permitted before 2017, according to Global Energy Monitor. China is also expected to become the world's largest importer of natural gas by 2020. Even the Russian gas fields from Siberia supply only a fifth of China's energy demands in 2020.  China has made large strides in renewable energy helping it meet its Paris Agreement targets. Renewable energy is about 10% of China's energy mix, but its use showed growth of 29% in 2018, making up half of the world's growth. China's use of coal in the energy mix has dropped to 58% in 2018 from 72% in 2008, according to BP 2019 Statistical Review, as a result of renewable energy investments. At the Madrid Climate Conference China renewed its commitment to the Paris Climate Change Agreement. Now it is a balancing act keeping in mind energy security and economic growth along with the need for clear skies and better air quality. ...

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India's Russian oil imports Indian OMC's (oil marketing companies) say Russian discount for oil was about $8.50 per barrel in FY24, and dropped to $3-5 in 2025 with at present in August 2025 it being $1. CLSA/Citic Securities research report uses an average of $4 per barrel to get the $2.5 billion gain for India per year in 2025. Note that Russian oil is of inferior quality and the CIF landing cost used by Indian companies is much higher because of long supply routes insurance costs compared to Saudi oil. India could shift to buying from Saudis and UAE in 2026, and reports suggest India is already making this shift as Jamnagar and other refineries in India shift to non Russian sources. India's gains from Russian oil imports estimated at $2.5 billion lower than the $10-25 billion figures says a CLSA/Citic Securities research report. In 2025 Indian oil imports are at present 36% or 1.8 million barrels a day from Russia of 5.4 mbd total oil imports. Saudis provide 14%, Iraq 20%, UAE 9%, USA 4%. One alternative for India would be to shift much of it's oil imports to the Saudis, UAE and US to shift to the situation before the Ukraine war and Russian discounts for it's large population.   ...

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U.S. president Obama made negotiating a Transatlantic Free Trade Agreement with the EU a priority for his second term. Further reduction of tariffs would increase trade by over $120 billion over 5 years from the current $1 trillion level, according to the U.S Chamber of Commerce.

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The US has 1 trillion in trade deficits each year and it is completing the destruction of manufacturing in the US. Half of this is with China as China exports through Vietnam and Mexico, third countries, in addition to 295 billion dollars of trade imbalance the US has with China. China, Mexico, Canada and Vietnam are the largest offenders. No country can long endure with such a loss of its manufacturing base. The US Navy itself is in danger without the manufacturing to compete with China in shipbuilding. China has taken up over 50% of shipbuilding, and soon the US Navy will not be able to protect the free world if these types of economists and self serving German or other foreign interests drive a false narrative and the US acts on such false narratives.  Without the US Navy in the Pacific, Atlantic and Indian Oceans no one is safe, not Germany, not the EU, not India, not Latin America or the rest of Asia and the world.

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The coronavirus is making implementation of the U.S. China trade deal less likely as Chinese imports from the U.S. decrease and China's exports continue to grow. China's exports to U.S. decreased by $60 billion but increased to other countries by $70 billion in 2019.

As a result the Trump administration is shifting its focus to another approach. The new multilateral approach is to combine the effort with allies Australia, India, Japan, South Korea, Taiwan, and France. This would take the shape of a Comprehensive and Progressive Agreement for Trans-Pacific Partnership to replace the old Obama period Trans Pacific Partnership which becomes defunct. The goal would be to build new supply chains with allies in Asia outside of China with the help of France and other countries that are wary of excessive dependence on China and have deep reservations of China's handling of the coronavirus outbreak.

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NYT exhortation for Congress to resist the lobbying pressures of the banks to weaken regulation for a Consumer Protection Agency and derivatives trading on exchanges. The first by amending legislation for a Consumer Protection Agency so that no states can pass tougher consumer protection laws, something that prevented states from protecting consumers from abuses in the mortgage business. The second to propose legislation for derivatives trading that allows corporations and hedge funds to trade derivatives privately. NYT editorial says Congress should require all derivatives dealers and users -banks, hedge funds and corporations- conduct their trades on exchanges where they are reglulations and public scrutiny. NYT responds to the banks and corporations that say this would raise their transaction costs to hedge any given risk, by saying that this is debatable. Greater transparency should reduce costs but even if there were some higher costs it would be outweighed by the larger benefits to the banks themselves and the country through the lower systemwide risks. ...

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BRICS is becoming an obsolete concept as Brazil, India and South Africa are essentially looking for ways in which they can increase opportunities for growth. It was a concept started by a Goldman Sachs investment banker Mr. O'Neill at a different time in 2010. The world has gone through the 2009 financial crisis, the pandemic, and the supply chain crisis with overconcentration of EU and US supply chain in China. These events are leading to a shift under the Biden administration to bring India  into the G7 into a new G8 that includes India. Only Russia, China and South Africa remain from the original BRICS. Russia because of the war in Ukraine now depends on Chinese support and trade. Brazil will gradually shift back to its position as part of the US alliance in Latin America with Mexico, Argentina and Chile. India with its plans for rapid growth to build the modern third largest economy by 2040 seeks supply chain integration with the US and EU in the position that China holds today.   ...

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US president Biden renews the US commitment to Asia on the second day of Quad meetings in Tokyo. Lessons from Ukraine were uppermost in the thinking of the Quad leaders from the US, Japan, India and Australia as a new framework is envisioned for Asia. That framework is envisioned through an economic framework the IPEF including South East Asia, the Quad as a core nation setup similar to the G-7, and direct ties such as US-India, US-Japan. Latin America is part of the US direct ties to Mexico, Brazil, Argentina and Chile. Europe is included through the Europe Trade and Technology Council and direct US ties with the European Union, Germany, France and Italy. President Biden is giving the kind of leadership of the Free World that Harry Truman gave following the Berlin Soviet Blockade and the US Airlift of 1948-1949 and the Korean War between 1950-1953 with Soviet and Chinese forces supporting the attack of North Korea against South Kporea similar to the Russian invasion of Ukraine.  ...

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Indian Navy has expanded to 140 warships and technology modernization with domestically produced ships. About another half of that 140 will be added and produced inside India in the next few years. This effort to build the Indian Navy comes with the need to ensure freedom of the seas for open navigation. Much of the world's trade happens for raw materials and manufactured goods through the shipping lanes including the seas in the Indian Ocean and adjoining region. Indian Navy is showing the results of this effort as it protects the oceans in its region in 2024 in the interest of all nations. The US is supporting India's effort with flow of new technologies. The French are also supporting India's efforts and president Macron is in India this week. He will attend the Republic Day celebration as a special guest in New Delhi on Jan 26, after an unprecedented road show in an open SUV in Jaipur today with prime minister Modi.

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A confidential report made for the British government is leaked to Buzzfeed News. The report points out that under every plausible scenario the British economy would take a hit from Brexit even it it remains in the single market. In the best possible scenario that it remains in the single market after leaving the EU Britain's GDP would decline by 2% over a 15 year period. In the scenario where Britain made a comprehensive trade deal with the EU, yet remained outside the single market growth would be lower by 5% than current forecasts. Ever sector of the economy is negatively affected except agriculture, according to the report- "EU Exit Analysis- Cross Whitehall Briefing." The current situation is that of a transition period for Britain with the EU  giving Britain 21 months of membership benefits, without the power to form new EU laws. UK economic growth of 1.8% for 2017 is the lowest since 2012, with the decision for Brexit affecting the economy adversely. This even leaves open the possibility of a new referendum on Brexit in coming years. ...

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Gerlad Seib points out that one should look less at what president Trump accomplished in the first 100 days and more at how he operated and learned during this initial period. This is certainly true because much of what happened in the first 100 days contradicts some of the tone that Trump setup during the campaign. When it comes to governing Trump has made an effort to learn and adapt and show resilience in the face of early setbacks on the travel ban and the health care bill, the Flynn episode. After this early period Trump took on a more disciplined approach, gave more room to and listened to more respected advisors- Tillerson on foreign affairs in shaping policy with Russia leading to Tillerson's presence at Lucca massacre memorial in Italy sending a clear signal about U.S. policies in line with its role in the past century in world affairs, Gary Cohn and Ross on economic policy and seeking Cohn's advice on tax plan, Ross's on NAFTA negotiations with Mexico. As a result the NAFTA fears were calmed down with statements by Wilbur Ross, the Commerce Secretary, that the goal was a win-win relationship with Mexico. Trump worked with his party in Congress to have the Supreme Court nomination of Gorsuch approved. Meetings with Merkel of Germany and Jinping of China were carefully planned and new relationships established as Seib points out, without ruffling trade relations. The appointment of Robert Lighthizer, as Trade Representative, also shows that efforts to give the U.S. a more level playing field in trade will be resolutely pursued in the win-win context. Lyrarc has profiled Lighthizer earlier in this decade after his op-eds in the media as he correctly anticipated the changing public mood on the need for fairness in trade relations. On relations with China and South Korea, Jim Mattis has taken the lead, and Pence's visit to South Korea also show deftness in handling what is one of the most difficult issues in foreign affairs. Mattis and Tillerson also have helped reinforce the Republican party policies on NATO and Europe, with the visit of NATO secretary general Stoltenberg to the White House. In the end it is how much you can learn in the first year, how much you listen, and the courage to act in difficult situations, the willingness to act contrary to one's instincts and self interest where necessary, that matters. This is especially true in an environment where as Seib points out the Democratic Party stands opposed to the Trump administration following a bitter election campaign.   ...

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The Bank of Japan started investing in stocks during the financial crisis of 2009. It has increased its investments in Japan's stock market during the pandemic as a way to boost spirits in the stock market to $400 billion as of Sept. 30, 2020.  Of this $56 billion is a gain in the stock market after Japan's stock market gained 60% from a deep low during the early period of the pandemic. In March Governor Haruhiko Kuroda doubled the ceiling for BOJ to $115 billion for purchases of exchange traded funds.

The purpose of this activity is to encourage risk taking in the broader economy, and ensure prices are rising at a small but steady pace. The BOJ now owns 6% of the total value of the Tokyo stock market. The BOJ does not buy individual funds but invests in the market through exchange traded funds. The BOJ purchases were effective in easing uncertainty and promoting confidence as the pandemic surged in Japan and in the rest of the world.

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What were the stories in the Economist magazine that were the most read stories of 2019? Not on president Trump. On Malaysia, China under Jinping, and exodus from San Francisco and Silicon Valley. The most read article was on the newly elected president of Brazil, Jair Bolsonaro. The mismanagement of the economy particularly extravagant state spending on the Olympics and soccer stadiums for the World Cup at the expense of basic sanitation services, bus and transport services, health services, led to the result of a majority of Brazilians rejecting the Workers Party and its leader former president Lula. Unfortunately most of the media including the Economist did not draw attention to this gap. During a period in which income from mining with export of iron ore, and soyabeans to China, enabled Brazil to live beyond its means, there was no effort to draw attention to glaring gaps in development of public services such as sanitation, bus services and transport, lack of building infrastructure other than to support mining. Glaring gaps in education and health services made the situation worse. The second most read piece in the Economist  was on March 10th- Malaysia's PM is about to steal an election. Here the Economist magazine joined the Wall Street Journal which originally broke the story on the 1MDB fund and irregularities in Malaysia where a development fund was misused by the government. Najib actually lost that election and the WSJ covered the story of the developments that followed in which Malaysia's new governemnt led by a returning former prime minister in his nineties Mahathir Mohammed, ousted his own protege Mr. Najib.  The third most read piece in the Economist magazine was - How the West got China Wrong.  Unfortunately the Economist magazine and most of the media covered China in the two decade long boom years without covering the other emerging story as well in which Mr. Lighthizer (now president Trump's top trade adviser) and others questioned the huge unsustainable trade surpluses in U.S. trade with China. With the economy facing huge downside risks and rising trade tensions with the U.S. Chinese president Jinping's move to remove the limit on terms in office in the Constitution was considered a shift from the notion that China was likely to turn into a democracy. Mr. Jinping had already completed his first term in office and the anti-corruption campaign, managing the economic boom for a soft landing, was carried out with the central leadership of the party, after the destabilization evident in the early part of Xi Jinping's first term. Much of China's path was predictable and rational behaviour in its national interest, what was not clearly defined or defended was the way the U.S. could sustain the trade deficits that had reached a billion dollars a day. Leading to Mr. Trump seizing on this as an election issue to form a bloc of voters separate from the two main parties, the Republicans and the Democrats. The fifth most read piece was on Oct 11, 2018- the next recession. It pointed out that with low interest rates central banks in the U.S. and Europe and America could not cope effectively with a recession. The sixth most read piece was on June 29, 2018- Bullshit jobs and the yoke of managerial feudalism. It cited Prof. David Graeber of the London School of Economics, who wrote a short essay that went viral on the prevalence of work that had no social or economic reason to exist, work he called "bullshit jobs". Graeber said people want to feel they are transforming the world around them in a way that is leading to a positive difference. No. 7, 8, 9, were on Bitcoin, Netflix and programming language Python. No. 10 most read was on Aug. 30, 2018- Why startups are leaving Silicon Valley. It showed that in 2017 more people left the county of San Francisco than entered. The main reason the cost of living was burdensome and out of control. As Amazon shifts attention to India and Brazil, and Apple pulls back from India, social media companies coming under fire for disinformation, this period of Tech is making way for a shift in a new direction. A direction that focuses on people's lives, wages, spending on much needed infrastructure and services. ...

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Prime minister Modi's visit to the US comes at a time when US president Biden is eager to show the US is fully engaged in the Indo-Pacific region with its allies in the Quad 4 countries- Australia, Japan and India. The recently announced Aukus defense agreement brought together 2 members of the Quad 4 the US and Australia, plus the UK. Aukus is designed to strengthen US presence as a naval power in the Indo-Pacific region in the Indian and Pacific oceans around India, Southeast Asia, China, and across the Pacific. After a futile engagement in Afghanistan the US is reorganizing its presence where it is strongest- in the oceans. In a way that Britain once did in the eighteenth and nineteenth century, the US is dominant in the high seas. US naval power far exceeds that of all navies in the world combined. This is meant to reassure India, Bangladesh, Sri Lanka, Thailand, Malaysia, Indonesia, Philippines, Vietnam, Australia and Japan, which together have close to twice the population of China, that the US has not diminished its presence in any way from that it had in the 1950's following the Second World War. With this new framework India enters discussions that will focus on health to deal with the pandemic and its after effects, with security and rule of law in the Indo-Pacific region, with trade, technology, new supply chain manufacturing structure in which India plays a key role. With this new focus and clearing past engagements made by other US  presidents, including some mistaken policies, the US emerges as a new force in the Indian ocean, China seas and Pacific ocean region.  On September 23 Modi meets Tim Cook for what could be new supply chain arrangements that Apple could be preparing as it and other US corporations build new supply chain structures to rebuild US manufacturing technologies capabilities that were lost to China over the period 2000-2020. During that period manufacturing technology knowhow was shifted out of the US in a mistaken policy that assumed design and invention were sufficient for the US to keep. The first step in this direction was a change of CEO's at Intel Corp with US president Biden pushing for new US technology reclaiming policy. Following that the new CEO at Intel Corp, Patrick Gelsinger, completely reassessed Intel's mistaken policies of ceding its entire semiconductor manufacturing technologies capabilities to Taiwan and China. Intel made a U turn and is now investing all or most of $50 billion in the US instead of in China or Taiwan.  On September 24 Modi meets Mr Biden to discuss trade, investment, defense, and security. On the same day the leaders of Japan, Australia, Mr. Suga and Mr. Morrison join Modi and Biden for the Quad 4 talks. Indian infrastructure capabilities and Indian economic growth would be key goals to strengthen India along its land borders along Tibet occupied region and Himalayas as part of the overall effort to build a new US and allied presence in Asia.  On September 21 Modi attends a Covid Summit that will look at the way forward in the aftermath of the pandemic and ways to vaccinate the remaining unvaccinated population in the world, as well as vaccination passports.  ...

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Progressive caucus in the US House of Representatives led by Pramila Jaypal, a first time Indian American Congresswoman defeats an attempt by Josh Gottheimer of the Problem Solvers caucus to separate much of the president Biden's agenda in health, education and social policy and risk it being defeated by Senators Manchin and Sinema in the US Senate. Without the efforts on child care, education and health, climate change and social services part of the Biden Workers and Families Plan much of the Biden agenda would remain unfinished and Democratic party promises not kept. This also means that Manchin a Senator from West Virginia with a population of 1.8 million and Arizona with a population of 7.2 million, both conservative leaning Democrats could sink the entire agenda of president Biden to support American families and workers for a population of 331 million people. That two states with a population of less than 3% of the American population could sink the entire agenda of president Biden shows how fragile a situation has been created within the Democratic party to support workers and families even during the pandemic following the leadership of Carter, Clinton, and Obama Ms. Jaypal, a three term Congresswoman from Seattle, Washington state, was first elected in 2016 with an endorsement from Bernie Sanders who was the Democratic Party's leading candidate for president till the late stages of the 2020 US presidential primaries. Bernie Sanders says of Jaypal- "I think she is doing an extraordinary job. And I think the Progressive Caucus is doing an extraordinary job." Sanders founded the Progressive caucus after getting elected to the Senate from Vermont 30 years ago. Even though it is hard to imagine the Democratic party being the Democratic party without bold policies in climate change, affordable housing, reducing income disparities,  investing big in childcare, education and healthcare, attempts were being made to sink the entire Democratic party and national agenda going back to Franklin Roosevelt. Jaypal is described in the WSJ as diplomatic and firm, saying "I am so proud of our caucus; I have never seen our caucus so strong. And I am a very good vote counter also." Fifty members of the 100 member Progressive Caucus held firm in support of president Biden's original agenda without which the president would have little to show in keeping promises he made to the American people in the election and little to differentiate him from Mr. Trump who also supported infrastructure spending. Separating the infrastructure bill would have risked sinking Mr. Biden's plan for recovery of America from the pandemic and the devastating policies pursued by American presidents in the last two decades. Policies by previous presidents that have impoverished the country, created huge income disparities, weakened America in the world in trade and technological leadership, and wasted resources in foreign wars. There are no centrists or far left- these are just labels. When Ms Japal said "Let's just remember the Speaker (Nancy Pelosi) is a great champion of this agenda. I think she was trying to do as much as she could to get this done," she could have said it is Mr. Biden's own agenda pushed forward with conviction to help workers and families during the pandemic, and build a solid American recovery, restore American leadership in the world. Pramila Japypal is the first Indian American woman in the US Congress, and one of only two dozen naturalized American citizens in the US Congress. That she could play such a critical role for good in the US Congress shows that with the right convictions, determination, experience, much can be done for the common good in America and the world.   ...

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Europe and India are preparing to sign a free trade deal that would triple existing 53 billion euro trade level in 5 years. An E.U.-India summit will take place in the fall to conclude this deal. Spain is particularly interested in India as its domestic market shrinks with austerity measures taken to reduce the deficit.

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This report in the Hindusthan Times compares the relatively few comments from India's Ministry of External Affairs on the Dokalam standoff between India and China, and the frequent and patriotic comments from the state media in China. India took a firm position on the sensitive border area road construction by China, because the Doklam plateau is the narrow area in the mountains that allows entry to India's northern plains. India and China announced disengagement following the incident. This report points out that the resolution happened on the eve of a BRICS meeting in China. Indian prime minister Modi's absence from the BRIC's meeting would have been an embarrassment for China, says the Hindusthan Times. The resolution would have happened after both sides realized that the border issue escalation was not in the interest of China and India as both sides face more important issues- India in the focus on modernization and China on sustaining growth and maintaining trade relations with the U.S. Trump administration at a time when the debt to GDP ratios exceed by some estimates 280% and trade has become a sensitive issue in America's midwestern states. ...

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The U.S. Federal Reserve, America's central bank, is staying away from riskier investments, junk bonds, leveraged loans, non government backed mortgage bonds, as it intervenes to support U.S. capital markets. On March 23 the Fed said it would launch facilities to buy not just Treasurys but also corporate bonds carrying investment grade ratings. Companies from Nike to Pfizer were able to issue $177 billion of invesrment grade bonds, according to Dealogic. As a result the corporate bond market is stabilizing. The Fed is not supposed to take credit risk, and just as the government intervention with aid to business has focused on keeping down unemployment, the Fed focus is on helping the parts of the market that are not leveraged, to help companies that were doing fine before the pandemic hit. As the president says repeatedly this pandemic was not their fault.

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Mr Iksil, a trader in Chase's CIO London office made such massive bullish bets on CDX-IG-9 index of 121 companies by selling credit default swaps, to the point where it cost less for protection on the index than for the individual components of the index. This worked in Jan-Feb 2012 with hedge funds on the other side having paper losses. In subsequent months hedge funds realized that Iksil would have to unwind some of these bets to avoid large losses. As a trader at Bank of America put it in a memo, at that point "Fast money smelled blood." The result is that hedge funds accelerated their bets against Mr Iksil's bullish positions, leading to the large $2 billion losses at CIO unit of Chase- losses on depositors money from aggressive bets in a volatile market. Mr Iksil is a French born trader, who has worked for Chase since March 2007. He has earned $100 million each year for Chase. He travels to London from his Paris home each week, and works from home Fridays. Two junior traders work with Iksil, primarily placing bets for complex trades in credit markets....

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Former Chinese foreign minister Wang Yi (2012 -2022) and its senior official makes these comments at the Munich Security Conference on US shooting down Chinese spy balloons. Yi says it was "absurd and hysterical." He says China is going to put out a paper on Ukraine that would underline the principles of territorial integrity and sovereignty. For China its crucial relations with Germany, trade with Europe are critical for its economy and growth. Germany's coalition government itself is divided on investment by China in the port of Hamburg, with the Greens not supporting that decision by chancellor Scholz. The issue for Biden is not simply the balloons. As The Guardian points out the US is pushing for China to withdraw or at least make conditional its support of Russia in its invasion of Ukraine that is a clear violation of the UN Charter that China says it supports. 

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The war to control Kherson is only weeks away. The town of Beryslav upstream on the Dnipro river is the next target for Ukrainian forces. This would lead to Kherson. Russian forces are withdrawing from the west side of the Dnipro river in Kherson and may decide to withdraw. If they stay in Kherson Ukraine may simply cut supply routes to the city and wait to avoid losses in winter fighting in muddy terrain.

Kherson is important to Ukraine because of the Dnipro river that runs through the heart of Ukraine. This is the only capital of a region that fell early to the Russian invasion forces. It is also important for control of the Black Sea region, Ukraine's only opening to the sea for trade and economic activity. It is important to remove any threats to Odessa, a major port for Ukrainian grain exports.

 

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The ruble plunges from 83 to the dollar to 111 for its largest single day fall on record on Feb. 27, following the swift American and European response to the Ukraine invasion. The Bank of Russia raised interest rates to 20% from 9.5%. The situation is reminiscent of August 1998 when the government devalued the ruble and suspended payments on debts, leading to collapse of the banking system. That situation led to emergence of Mr. Putin as the Russian economy was stabilized in the years following the collapse. By acting quickly with sanctions on Russia's central bank and on its other banks the trade in the ruble has essentially seized. Russia this WSJ report says may default on its debt as it would not be able to use its $600 billion in foreign currency reserves to support the ruble or its banking system, pay off outstanding debt payments.

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Russia has 600 billion dollars in reserves and with oil prices above $100, with the Ukraine conflict lifting oil prices for Russian oil exports, there is little that the US and Europe have done to prepare for this situation. The Merkel years were essentially wasted in building a trade based relationship on cheap Russian gas supplies, and the wasted resources under Bush and Obama in two wars in Iraq and Afghanistan only distracted the US from the major issues relating to China and Europe that it now faces. 

The need is for a new overall structure to be built- for social structure supporting all aspects of infrastructure, and stronger supply chains with local manufacturing. And international structures that include India and other nations of Asia and Latin America, Africa, that would be a framework for the future- a broader framework for peaceful relations.