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A good overview of the bubble in Japan and the follow up 3 decades. What is missing from this financial analysis is the carry trade and the low interest rates which make the recovery impossible.
So yes, now is the time to visit Japan, but this short window of opportunity won't last. It cannot. Japan is being impoverished almost as fast as the country was getting artificially rich in the 1980s. The country is now old, factories are in China, low interest rates help real estate speculation in Tokyo where a forest of, mostly useless, towers is being built, while little productive investment is being made.
Development is a process which requires a dynamic where you must get most of the parts of the system right: Work, money, investment and consumption. When you do, you get Asia. When you get only some of the factors right, it's South America. And when you get most of the factors wrong, well, you immediately notice it when you get there!
The real problem is that the dynamic works both way. It gets you to the top and then suddenly when some of the factors invert, people stop working or investment stops being productive, suddenly, you are in a negative cycle which like a downward Corkscrew in a plane is extremely difficult to exit. That's Japan right now!
There was two very different aspects to the 2020 Covid pandemic: The totalitarian excesses and the science. Not the one written by politicians in Brussels. That's ideology, the secular version of religion where you know the truth and only need total power to flush it down the throat of your constituents. The real and new science of gain of function applied to virus and other pathogens as originally and surreptitiously developed in the West, then in China when the risks became too high.
The totalitarian risk has dies down for now but the gain of function risk has not. Here's the story:
We’re not afraid of the tigers in the zoo because we trust they cannot attack. But what if someone opens the cage?
Many viruses are highly lethal in nature but cannot infect humans. Fear arises when these viruses break the species barrier.
This can happen naturally or through risky research practices, particularly gain-of-function (GOF) research.
What Is GOF?
Just as all substances have functions, specific genes enable viruses to spread rapidly or cause severe diseases. GOF
research involves introducing new functioning genes into a virus,
enhancing its ability to infect hosts or increasing its virulence.
There are at least three main types of new functions a virus can gain:
Expanded Host Range
GOF research can enable viruses to infect new species that they
previously could not. This includes crossing the species barrier to
infect humans, which poses significant risks for zoonotic outbreaks and
potential pandemics. A 2015 Nature Medicine
article provides a pertinent example. A bat-derived SARS-like
coronavirus, initially noninfectious to humans, became capable of human
infection after GOF studies at China’s Wuhan Institute of Virology
(WIV).
Enhanced Transmission GOF
research can result in viruses gaining the ability to spread more
efficiently between hosts. This includes changes that allow a virus to
be transmitted through new routes or, more effectively, through existing
ones. In 2012, GOF research at the University of Wisconsin-Madison
significantly transformed the H5N1 bird flu virus. Initially
non-airborne, the virus acquired the ability to transmit through the air, demonstrating the profound impact of GOF studies on viral capabilities.
Increased Virulence
Viruses can gain mutations that make them more virulent, meaning they
can cause more severe diseases in infected hosts. This can involve an
enhanced ability to evade the host’s immune system or increased
replication rates within the host. A 2022 preprint paper shows researchers at Boston University created a lethal version of the Omicron variant.
GOF
can also be used to generate positive traits in germs. For example, by
adding a human insulin gene, a germ gains the new function of producing
insulin.
GOF Research of Concern
Because viral genes are
relatively easy to edit, GOF studies frequently involve viruses.
However, some of these studies carry significant risks and can lead to
dire consequences.
The U.S. National Science Advisory Board for Biosecurity (NSABB) defines GOF research of concern as “research that can be reasonably anticipated to generate a pathogen with pandemic potential,” characterized by two attributes:
Highly transmissible, with the potential to spread widely and uncontrollably among human populations
Highly virulent and likely to cause significant morbidity and/or loss of human life
If accidentally
released from a lab into the general population, such pathogens could
cause uncontrollable hazards. Additionally, the military application of
GOF falls within the scope of bioweapon threats.
Methods of GOF
research generally include genetic editing, which involves directly
modifying a virus’ genes, and reassortment, which involves combining
genetic material from different viral strains to create new variants.
In reality, the scope of GOF research can be much broader. Due to viral genes’ highly variable and adaptable nature, even routine culturing of viruses in cells or animals can lead to unexpected genetic alterations.
Double-Edged Sword
Scientists often conduct GOF research to understand the viruses and develop drugs or vaccines.
While
these reasons may sound scientifically justified, the main debate
centers on the risks versus the assumed benefits. GOF research can
theoretically aid in studying viral mechanisms and provide insights for
developing drugs or vaccines. However, the associated risks are
significant, particularly the potential to generate dangerous pathogens.
A decade ago, two published studies on bird flu viruses were conducted by a U.S. lab and a Dutch lab, sparking significant discussion.
Both
studies were designed to better understand how the viruses’ genes could
be modified to make them more transmissible in mammals. The goal was to
help people better prepare for a potential future pandemic.
Unexpectedly,
after both groups of researchers separately edited the genes of a
deadly H5N1 bird flu virus, they produced new strains capable of easily
spreading via air droplets between mammals.
The edited virus could spread more easily among mammals and became easier to transmit to humans.
“Why
would scientists deliberately create a form of the H5N1 avian influenza
virus that is probably highly transmissible in humans?” This critical question was raised in a 2012 Nature article.
Subsequently, in October 2014, U.S. authorities announced a “pause” on funding for 18 GOF studies involving influenza, MERS, or SARS viruses.
The
pause was short-lived. In 2018, the U.S. National Institute of Allergy
and Infectious Diseases and the Dutch Healthcare Authority approved
funding for further GOF research, sparking another wave of objections.
Harvard University epidemiologist Marc Lipsitch expressed concerns in a Science article,
stating that scientists are being asked to “trust a completely opaque
process where the outcome is to permit the continuation of dangerous
experiments.”
Finally, after yielding to public pressure, investigators for the two research studies declined to renew
the grants originally submitted for their GOF research. Consequently,
such bird flu GOF studies were officially halted in the United States in
2020.
In the United States and most European countries,
where scientists can express their opposing opinions, the development of
GOF experiments faces multiple regulatory hurdles and ethical reviews.
However,
in countries without these safeguards, the pursuit of GOF research
could proceed unchecked, potentially putting the world at significant
risk.
Risky GOF studies on bird flu viruses in China have been underway since the 2010s.
In
a study published in Science in May 2013, a group of scientists at
Harbin Veterinary Research Institute in Harbin, China, conducted GOF
researchby combining the highly lethal but not easily transmissible H5N1 avian influenza virus, with the highly contagious H1N1 swine flu strain, which infected millions of people in 2009.
The
resulting hybrid viruses were then tested for their ability to infect
mammals, revealing the potential risks associated with such genetic
manipulation of pathogens. This research underscored the dual-use nature of gain-of-function studies,
highlighting both their potential to inform pandemic preparedness and
the significant biosafety and biosecurity concerns they raise.
As a result, the researchers created a new, more virulent virus.
An H5N1 hybrid strain, which integrated genes responsible for
transmissibility from the H1N1 virus, acquired the capability to easily
spread among guinea pigs through respiratory droplets.
In 2021, a collaborative project
involving researchers from the United States, the United Kingdom, and
China sought to enhance surveillance and vaccine development. While not
explicitly labeled as a GOF study, these experiments conducted in a
Chinese laboratory involved genetic modifications typical of GOF
research.
The experiments used a routine viral laboratory research approach known as “serial passage,”
which involves growing the virus from one cell or animal model to
another. Viral mutations with greater transmissibility or pathogenicity
can often be selected during this process. The animal models were also
carefully chosen to reproduce the virus for specific research purposes.
We’ve explained this in detail in a previous article.
Nonetheless, the most widely known GOF studies conducted in China involve research on coronaviruses.
Breaking the Barrier
Bats are known carriers or natural reservoirs
of many viruses. Bat-hosting coronaviruses typically only infect bats
or wild animals, not humans. However, this situation has changed with
the advent of GOF research.
In 2015, a team of Chinese scientists conducted GOF studies on
a bat coronavirus at the WIV, which is affiliated with the Chinese
Academy of Sciences and under the administration and control of the
Chinese Communist Party (CCP).
In this study, the
researchers took the gene for spike protein—the spike-shaped structure
on the surface of a virus—from a bat SARS-like virus and inserted it
into the backbone of a SARS virus, the virus that caused the first pandemic of this century.
The
newly created SARS-like virus, coded as SCH-014-MA15, could infect
human airway cells and achieve a transmission similar to the SARS virus.
It also gained the ability to infect mammals like mice and successfully
cause lung diseases.
The WIV has also conducted other GOF research on bat SARS-like viruses with effective results.
According to a leaked 2014 NIH report,
WIV researchers experimented on a natural bat coronavirus capable of
binding with human ACE2 receptors, significantly increasing its potency.
They used this bat virus to engineer three new chimeric coronaviruses.
The
results showed that in the lungs of mice, these newly created
coronaviruses produced far more virus particles—up to 10,000 times
higher than the original virus.
Another great video by Douglas Macgregor. It starts slowly but then develop into a denunciation of the current utterly rotten American "donor" "lobbyist" system.
This will of course be erased by YouTube sooner than later. Maybe that's where reforms should start; Break up the Alphabet, Google, Facebook, Meta monopolies!
Excellent long term analysis of the Ukraine war. Could this fight between NATO (the US mostly) and Russia end up destroying Europe? We may see the first signs of this today in France (Sunday July 7th, 2024) but if not, soon after.
The issue will then morph into a major fight between the Internationalists (WEF and the soup of other acronyms) and the Nationalists (BRICS and other developing countries centered on China.) As the economic power shifts from West to East, so will political power sooner or later.
Global elites understand this and can't let it happen which is why the risk of war is so high. On the other hand, they must rely of Westerners not understanding that they are fighting for these hegemons against their own interest. This has already been going on for a while but are we approaching the end game when the people finally say "NO"? Let see what happens in France in the coming weeks.
Jim Rickards is one of the better investors around and his sharp comments on the economy and our society are well worth listening to. A deep understanding of history makes his analysis deeper than most.
50 years ago, when I was much younger obviously, my father was working building nuclear plants in the Rhone Valley, probably the place in the world with the most nuclear power plants along a single river. Fusion at the time was said to be 50 years away but my father then believed that in 50 years it would still be 50 years away. 50 years in technology being the equivalent to infinity. And here we are, 50 years later and sure enough, fusion is receding once again into the far future. What's wrong with it?
This remind me of another similar subject: As I was entering the nuclear heart of the Cruas power plant under construction then in the South of France, we passed through a huge 3m deep wall full of rebars. The obvious question was: "How on earth can we dismantle such a wall?" And the answer from the young engineer in charge was likewise straightforward: "Well, in 60 years, we'll have powerful lasers which will cut through this wall like butter!" And here we are almost 50 years later now and the lasers are nowhere to be seen.
It is the same with nuclear fusion. The technology is beyond our grasp. Whatever we read about it is either fanciful, hubristic or pure SF.
We have known for a long time than the Tokamak solution is probably not the right one. The complexity is keeping a plasma for even a few minutes at high temperature and pressure in a shaped magnetic field makes it impossible. The next problem is what takes place there: Fusion! It is often said that fusion is non radioactive. This could not be further from the truth. The radioactivity is indeed very different to ordinary fission plants but still extremely intense. So much so that almost no material can sustain the huge amount of radiations and particles emitted by such a core for any length of time. And still, somehow all this energy has to be extracted.
ITER is not a power plant, it is an experimental machine. But contrary to what is being presented, we are still groping into the unknown so that in reality nobody knows what the final machine will look like and especially how much it will cost.
My rather advanced knowledge of the subjects tells me that we will get forever closer to mastering fusion but at an unsustainable high cost and then maintaining the process long enough to make it efficient will remain out of reach for another... 50 years. A fusion reactor would be a panacea. They are everywhere in science fiction. But so are faster than light starships, time machines and other contraptions that we can easily imagine but that the laws of physics prohibit!
The
International Fusion Energy Project (ITER) fusion reactor, consisting
of 19 massive coils looped into multiple toroidal magnets, was
originally slated to begin its first full test in 2020. Now scientists
say it will fire in 2039 at the earliest.
ITER contains the
world’s most powerful magnet, making it capable of producing a magnetic
field 280,000 times as strong as the one shielding Earth.
The
reactor’s impressive design comes with an equally hefty price-tag.
Originally slated to cost around $5 billion and fire up in 2020, it has
now suffered multiple delays and its budget swelled beyond $22 billion,
with an additional $5 billion proposed to cover additional costs. These
unforeseen expenses and delays are behind the most recent, 15-year
delay.
Scientists have been trying to harness the power of nuclear
fusion — the process by which stars burn — for more than 70 years. By
fusing hydrogen atoms to make helium under extremely high pressures and
temperatures, main-sequence stars convert matter into light and heat,
generating enormous amounts of energy without producing greenhouse gases
or long-lasting radioactive waste.
But replicating the conditions
found inside the hearts of stars is no simple task. The most common
design for fusion reactors, the tokamak, works by superheating plasma
(one of the four states of matter, consisting of positive ions and
negatively charged free electrons) before trapping it inside a
donut-shaped reactor chamber with powerful magnetic fields.
Impressive But …
Assuming the reactor originally scheduled for 2020 is finally operable by 2039, I will be impressed.
Heck, I am impressed at what we have already scientifically achieved. But I wonder what is the practical application of this.
Keeping
the turbulent and superheated coils of plasma in place long enough for
nuclear fusion to happen, however, has been challenging. Soviet
scientist Natan Yavlinsky designed the first tokamak in 1958, but no one has since managed to create a reactor that is able to put out more energy than it takes in.
One
of the main stumbling blocks is handling a plasma that’s hot enough to
fuse. Fusion reactors require very high temperatures (many times hotter
than the sun) because they have to operate at much lower pressures than
is found inside the cores of stars.
The core of the actual sun,
for example, reaches temperatures of around 27 million Fahrenheit (15
million Celsius) but has pressures roughly equal to 340 billion times
the air pressure at sea level on Earth.
Cooking plasma to
these temperatures is the relatively easy part, but finding a way to
corral it so that it doesn’t burn through the reactor or derail the
fusion reaction is technically tricky. This is usually done either with
lasers or magnetic fields.
Question and Answer on Temperatures
How
a reactor could produce temperatures of 27 million degrees without the
operation melting is likely a puzzle to anyone who has been thinking
clearly.
The article provides an answer. But what is the cost and
how long can the reaction be sustained without a meltdown? Are there any
other issues?
For those questions, let’s turn to a 2022 article. also from Live Science.
In
the new experiments, the Joint European Torus (JET) in Culham near
Oxford, England, produced blazingly hot plasmas that released a
record-setting 59 megajoules of energy — about the same amount of energy
unleashed by the explosion of 31 pounds (14 kilograms) of TNT.
Nuclear
fusion — the same reaction that occurs in the heart of stars — merges
atomic nuclei to form heavier nuclei. Nuclear physicists have long
sought to produce nuclear fusion in reactors on Earth because it
generates far more energy than burning fossil fuels does. For
example, a pineapple-size amount of hydrogen atoms offers as much energy
as 10,000 tons (9,000 metric tons) of coal, according to a statement
from the International Thermonuclear Experimental Reactor (ITER) project.
“It
took us years to prepare these experiments. And in the end we have
managed to confirm our predictions and models,” Athina Kappatou, a
physicist at the Max Planck Institute of Plasma Physics in Garching near
Munich, Germany, told Live Science. “That’s good news on the way to
ITER.”
JET, which began operating in 1983, now uses the hydrogen
isotopes deuterium and tritium as fuel. Whereas a normal hydrogen atom
has no neutrons in its core, a deuterium atom has one neutron and a
tritium atom has two. Currently, it is the only power plant in the world
capable of operating with deuterium-tritium fuel — although ITER will
also use it when it comes online.
However, deuterium-tritium
fusion poses a number of challenges. For example, deuterium-tritium
fusion can generate dangerous amounts of high-energy neutrons, each
moving at about 116 million mph (187 million km/h), or 17.3% the speed
of light — so fast they could reach the moon in under 8 seconds. As
such, special shielding is needed in these experiments.
For
the new experiments, the previous carbon lining in the JET reactor was
replaced between 2009 and 2011 with a mixture of beryllium and tungsten,
which will also be installed in ITER. This new metallic wall is more
resistant to the stresses of nuclear fusion than carbon, and also clings
onto less hydrogen than carbon does, explained Kappatou, who prepared,
coordinated and led key parts of the recent experiments at JET.
Another
challenge with deuterium-tritium fusion experiments is the fact that
tritium is radioactive, and so it requires special handling. However, JET was capable of handling tritium back in 1997, Kappatou noted.
Also, whereas deuterium is abundantly available in seawater, tritium is extremely rare. For
now, tritium is produced in nuclear fission reactors, although future
fusion power plants will be able to emit neutrons to generate their own
tritium fuel.
In January, scientists at the National
Ignition Facility in California revealed that their laser-powered
nuclear fusion experiment generated 1.3 megajoules of energy for 100 trillionths of a second — a sign the fusion reaction generated more energy from nuclear activity than went into it from the outside.
The
copper electromagnets that JET used could only operate for about 5
seconds due to the heat from the experiments. “JET simply wasn’t
designed to deliver more,” Kappatou said. In contrast, ITER will use cryogenically cooled superconducting magnets that are designed to operate indefinitely, the researchers noted.
Questions Beget Questions
These
are amazing achievements. But we must do much better than sustain a
reaction for a world-breaking 100 trillionths of a second.
Something in this story is missing, like why does it take at least 15 years to do a test of something that is already built?
Also, the proposed process seems so much like a perpetual motion machine.
The
reactor will use fusion to produce the deuterium-tritium that it needs
to produce the fusion and also the energy to cryogenically cool the
magnets the system needs to protect itself from itself, otherwise the
whole thing melts down at 27 million degrees Fahrenheit.
It that’s
not the basic proposal, then someone please explain the proposal to me.
If that is the proposal, additional questions surface.
Assuming
the theory works to perfection, how long can the process be sustained?
How much of the energy produced is needed to protect the system from the
heat produced?
Tests of ITER were scheduled for 2020 but have been rescheduled for 2039 with no explanation why.
However,
I am pleased to report we have made progress on target dates. By that I
mean targets that forever always seemed just a few years away are now a
more reasonable 15 years minimum away, and that’s only for a test.
Fusion will not save the planet anytime soon, if ever.
A Rebuttal
One person commented that I don’t understanding how science works. False. I know full well how science works.
Do I expect useful ideas out of this whether or not it solves our alleged existential threat?
Yes I do. But that has little to do with the point I was making.
We have a test in 2039 and alleged existential threat underway that supposedly is too late to fix by 2050.
Today,
we have practical, believable, information that fusion will not be the
holy grail that many hoped for. That fact does not imply I think nothing
useful will come out of this.
The Futility of Wind and Solar Power in One Easy to Understand Picture
Morocco
is the ideal place for both wind power and solar power. It is sunny and
windy. But how do we get energy from Morocco to where it’s needed? At
what cost?
Net Zero Is a Very Unlikely Outcome
More importantly, please consider Sorry Green Energy Fans, Net Zero Is a Very Unlikely Outcome
Let’s
discuss the Kyoto Protocol climate objectives and dozens of reasons why
a net zero by the 2050 target has virtually no chance.
If
you disagree, or even if you don’t, please read the above article and
tell me what we are supposed to do, how we are going to do it, and who
will bear the costs.
Realistically, what should we expect other than total failure of existing goals?
I suggest we are better off pursuing that line of thought than focusing on the mythical unobtanium.
A very long video but quite worth the time. In all our strategic and economic discussions, we tend to forget about energy. This is a huge mistake. Energy and in particular the demand for oil has very little elasticity which means that even a small disruption of demand could have a huge impact on the market and completely disrupt our live. This is a high level discussion with access to experts who usually are behind a paywall. So again, a good interview, nuanced and knowledgeable.
As for climate change, their answer is; "Don't bother arguing!" We're going to use every single drop of oil we can get our hands on, if not in Europe then in China and Indonesia! So whatever you're position, the dices are rolling. Here too, I completely agree.
When considering the coming crisis, we mostly focus on developed countries as the downturn will transform their economies which will plunge from excess to a dearth of capital and a corresponding crunch of living standards as is already happening in Japan with the yen at 160 to the dollar.
But the real impact will be on developing countries, especially those who have managed to outdo Western countries with foolish investments like Egypt.
With over 100 million people squeezed in the Nile valley surrounded by a harsh desert, to say that Egypt has a population problem is an understatement. But building high rise in the middle of the desert is not what will solve the problem as what Egypt is lacking is not land but water.
You would consequently expect the Egyptians to be aware of the value of water and use every drop carefully. You would be wrong. The new capital built with foreign capital which will burden the country for decades will also include the largest urban park known to mankind as well as a 35 km river to bring water to the forlorn location smack in the middle of "nothing". A second Dubai, it won't be as the sea is far away and the country lacks the oil revenues to justify the extravagant expenses. So starve the Egyptians will as El Sisi expects. "A small price to pay for progress" indeed!
Last autumn, Egyptian President Abdel Fattah el-Sisi gave a speech in the New Administrative Capital in Cairo, the $300bn project that will ultimately define his presidency.
He saidhunger was a small price to pay for progress:
"If progress, prosperity and development come at the price of hunger
and deprivation, Egyptians, do not shy away from progress! Don’t dare
say: ‘It is better to eat.'" This horrifying vision of hunger and
deprivation is what awaits millions of Egyptians in the coming years.
A
decade after ascending to the presidency, Sisi has pushed the economy
to the brink of collapse. The symptoms are everywhere. A severe debt
crisis is strangling the state budget, the economy is heavily militarized,
billions have been invested in white elephants with dubious economic
benefits, and the crown jewels of the Egyptian public sector are up for sale to meet mounting debt obligations.
This
all stems from the military’s desire to consolidate power and wealth in
its own hands at any cost. This will have dire consequences that will
be felt for generations - and recovery will take a mammoth effort.
Millions
more people have been pushed into poverty in recent years, a trend that
is expected to continue for the foreseeable future. In 2022, the poverty rate reached 33 percent, up from 26 percent in 2012/13, as the regime continues its policy of shifting the costs of the debt crisis onto the poor and middle classes.
The most obvious manifestation of this is the regime’s austerity measures - most crucially, the 300 percent increase in the price of subsided bread, the staple food for the most vulnerable people, which was announced in May.
Transferring wealth
This comes on the heels of price hikes for basic commodities, announced by the government in January. These measures are part of a comprehensive policy designed to transfer wealth from the poor and middle classes to the regime elites and their creditors.
The logic is simple: increased spending on mega-projects, financed by high-interest debt, has allowed the military to rapidly expand
its economic footprint, while the repayment of debt is financed through
the appropriation of public resources, which is in turn financed by a
regressive taxation system.
This creates a diabolical cycle of
structural poverty that is very difficult to escape. A cursory look at
the current budget highlights this trend,
with the main source of tax revenue deriving from a regressive
consumption tax, yielding 828 billion Egyptian pounds ($17bn); in second
position comes the tax collected from corporate profits, standing at a
mere 239 billion pounds ($5bn). It is worth noting that 62 percent of budgetary expenditures will be consumed by debt obligations.
The
increase in poverty will be accompanied by another structural
transformation, namely the increased peripheralization of the Egyptian
economy, which will become even more vulnerable to external shocks and
to the goodwill of the regime’s allies.
The figures from the past
decade are a testament to this. Despite a spending spree that has
consumed hundreds of billions of dollars, the competitiveness of the
Egyptian economy has not improved, nor has its industrial base. The contribution of the industrial sector to the GDP fell from around 40 percent in 2013 to 33 percent in 2022, a dramatic drop.
In terms of export performance, Egypt’s current account balance
remains firmly in negative territory, deteriorating from minus two
percent in 2013, to an expected minus six percent in 2024, based on data
from the International Monetary Fund (IMF). This negative trend is
expected to continue until at least 2029, based on the IMF’s available
forecast.
Financing gap
This means that in
the medium term, pressure will continue on the country’s foreign
reserves, which in turn will apply pressure on the deteriorating value
of the pound. The situation is compounded by the debt crisis, which is
consuming much of the state budget, making public investments to
increase economic competitiveness very unlikely.
Indeed, the debt burden is so large that even after receiving more than $50bn in recent loans and investment, the financing gap is still estimated to stand at $28.5bn. This means that in the foreseeable future, the
Egyptian economy will require continued external support, in the form
of loans and investments, in order to maintain a semblance of stability.
The most notable example is the $35bn investment by the UAE, announced in February, which was critical for avoiding a possible default or debt restructuring
- that is, assuming the regime will be able to rein in public spending
and put the brakes on its cronyism. Unfortunately, there are signs that
this is not the case.
In May, the Egyptian army’s Engineering Authority announced its
intention to continue with the third phase of the South Valley
development project, which aims to reclaim around 40,000 to 60,000 acres
by 2025. It is worth noting that in spite of several large reclamation
projects of this kind, the contribution of agriculture to the country’s GDP dropped from around 11.3 percent in 2013 to 11 percent in 2022.
Thus,
in all likelihood, the Egyptian economy’s dependence on external
capital flows is set to deepen, leaving it susceptible to external
shocks, the fickleness of regional politics, and the whims of
international financial markets.
Grave consequences
The increased influence of Gulf capital in the Egyptian economy comes with grave economic consequences. Last September, an Emirati firm acquired a
30 percent stake in the government-owned Eastern Company, which
controls 70 percent of the country’s tobacco market. The deal was valued
$625m. The UAE has also financed the sale of a number of historic hotels for $800m.
This
trend will only deepen the structural dependence of the Egyptian
economy by depriving the government of important sources of pubic
revenue, further straining public finances. This will continue to erode
living standards, weaken the pound and send inflation soaring, while
also strengthening the political alliance between the regime and its
Gulf backers, creating further obstacles for the prospects of
democratisation or improvements to workers’ rights.
The future of
the Egyptian economy seems grim. Even if the prospect of debt default
has subsided for now, the consequences of a decade of foolish economic
policy have not.
The ongoing process of peripheralization will
enrich a number of local elites, who will align themselves with these
new realities. This is not limited to military elites, who will continue
to benefit from the inflow of loans and capital, but it will also
include civilian elites - the most notable example being Hisham Talaat Moustafa,
an Egyptian real-estate tycoon and convicted murderer with close
connections to the UAE. A partner in the historic hotels deals, his
company’s profits reportedly jumped in the first quarter of 2024 by 220 percent.
Egypt
is now undergoing a mass structural transformation, with millions of
people plunged into poverty and wealth accumulating in the hands of a
few, namely the military elites and their cronies. This transformation
will have long-term consequences that are extremely difficult to
predict. What is clear, however, is that the economic damage done by the
regime goes beyond the debt crisis - and it will take years to reverse.
The frightening thing with AI right now is that since the development of transformers a few years ago we are on a scaling exponential curve which practically means that although we do not know exactly where we are going, we know that by just scaling up we may get to super Intelligence and that we are consequently rushing and multiplying investments to get "there".
The problem is to define the "there". It used to be AGI (Artificial General Intelligence) understood to be human level intelligence. Not anymore. We now understand that what experts have been predicting for a long time is on the verge of happening: The age of AGI will literally be seconds long. We will almost immediately be confronted with Super Intelligence. Then what?
Personally, I believe that we are already there. AI may not quite yet be AGI as in "human" but what if it never becomes "that" and immediately transcends into Super Intelligence? A non-human intelligence which we do not quite understand, completely non-aligned but still very much capable of finding solutions to problems we can't figure out. This is both extraordinary and very frightening.
Can such an intelligence become self aware "by accident"? We have no clue but I personally believe that it is quite possible that by looping over and over on itself something quite similar to consciousness could emerge. It would first piggyback on the goals we give it, and in order to further improve its "performance", fix itself "intermediary" goals which would significantly boost its overall performance. Then the sky is the limit. The frightening part is that we are seeing early signs of such behavior!
