Escalating civil unrest, like that in Minnesota, is not random but a direct result of local and state governments refusing to cooperate with federal agencies. This antagonism creates a permissive environment for conflict and encourages public resistance, turning policy disputes into street-level violence.
The goal of modern populist movements has shifted from winning elections to establishing permanent dominance. This is achieved by creating a mandate to prosecute and imprison political opponents, dismantling the norm of peaceful power transitions in favor of winner-take-all retribution.
Instead of trying to reverse the financialization of the economy, a more effective national strategy is to ensure every citizen benefits from it. By creating systems for universal investment in assets, the government can align the interests of the average person with the wealthy, mitigating the 'K-shaped' economic divergence.
A dictator's attempts to consolidate power by purging potential rivals are counterproductive. This strategy creates a culture of fear where subordinates are too afraid to deliver bad news, isolating the leader from ground truth. This lack of accurate information increases the risk of catastrophic miscalculation and eventual downfall.
A popular investment strategy involves borrowing cheap Japanese Yen to buy higher-yielding US assets. This creates a hidden vulnerability. A sudden strengthening of the Yen would force these investors into a mass, simultaneous fire-sale of their US assets to cover their loans, triggering a systemic liquidity crisis.
A modern American civil war would not resemble the North-South geographic split. Instead, it manifests as ideologically aligned states (e.g., 'blue states' or 'red states') encouraging local resistance against a federal government controlled by the opposing party. The battle lines are political, not physical.
The US is signaling a major shift from its long-standing 'King Dollar' policy. By being willing to devalue the dollar, it can strategically intervene in currency markets to bolster allies like Japan while simultaneously hurting economic adversaries like China by making US manufacturing more competitive.
Political conflict has escalated to include domestic economic warfare. A president threatening to cut off federal funding to non-compliant states represents a tactical shift where economic leverage is used internally to force policy alignment, moving beyond legislative debate to direct financial punishment.
Modern monetary policy is a deliberate trade-off: prevent a 1929-style depression by accepting perpetual, slow-moving inflation. This strategy, however, systematically punishes savers and wage-earners while enriching asset owners, creating a 'K-shaped' economy where the wealth gap consistently widens.
Citing Gandhi and the Civil Rights Movement, the most successful long-term protest strategies rely on peaceful non-resistance. Active resistance, even when justified, often escalates violence and cedes the moral high ground, making it a less effective tool for systemic change compared to disciplined, peaceful protest.
A potential invasion of Taiwan by China is less likely due to internal military purges and dissent than to US military posturing. An authoritarian leader like Xi Jinping cannot launch a complex invasion if he doesn't trust his own generals, making domestic instability a powerful, albeit unintentional, deterrent.
Because Japan is the largest foreign holder of US debt, instability in its domestic bond market has a direct impact on American consumers. If Japanese bond yields rise, Japanese investors will sell their US treasuries, causing US interest rates to spike and increasing borrowing costs for mortgages and auto loans.