The New World Order Is Quickly Moving In

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Pastor Dale Morgan

Mar 13, 2010, 1:17:53 PM3/13/10
Perilous Times, Globalisation and The New World Order

The New World Order Is Quickly Moving In

Bernie McSherry 13.03.10, 2:20 PM ET
Forbes Magazine

Recent events offer evidence that the ground beneath our feet is shifting, both literally and metaphorically, and scientists and traders alike are noting the effects. In the literal sense, Richard Gross, a geophysicist at NASA's Jet Propulsion Laboratory, estimates that the massive earthquake that struck off the coast of Chile last Saturday moved hundreds of miles of solid rock several yards, altering the Earth's axis by approximately three inches due to the shifting of such a substantial mass. A movement of that magnitude is rare; yet investors can be forgiven for being unimpressed. The axis of world economic power is also shifting as the aftershocks of economic crisis continue to alter the world order.

The European economy appears to be on shaky ground as its leaders struggle to come to terms with what we will one day view as having been an inevitable sovereign debt crisis, caused by structural shortcomings in the European Monetary Union and brought to a head by profligate spending on the part of its weakest members. While it seems likely that Germany and France with their banks heavily exposed to Greek sovereign debt will reluctantly guarantee Greece's bonds, the assault on the euro is underway and massive short bets are being placed worldwide. Traders won't be surprised to see the market turn on Spain next, further testing the resolve of the E.U.'s strongest members. The fate of the euro itself may hang in the balance.

Just as tectonic movements can dramatically alter the landscape (the Chilean quake had the effect of raising Santa Maria Island, off the coast of Concepcion, by six full feet, claiming new land from the sea), so too can shifts in economic mass affect the distribution of global power. The upheavals that have plagued the financial world in the last two years have lifted China to a new level of prominence as the world's largest exporter, one with a nearly insatiable appetite for commodities. The sleeping giant has moved into the next phase of the economic cycle far sooner than the rest of the world, and it is taking key resource suppliers like Australia along for the ride. Both governments have recently taken steps designed to prevent their economies from overheating and creating new asset bubbles.

This stands in stark contrast to the actions of governments across Southern Europe where debt concerns are forcing governments to curtail stimulus efforts, even in the face of deepening recessions. As Asia supplies the majority of world economic growth over the next decade or three, America's gaze will continue to shift westward. The world's economic axis is shifting and the new century will be dominated by the countries of the Pacific Rim and the Indian subcontinent.

Western efforts to slow the process are probably doomed to failure, victims of enormous demographic differences that benefit the nations of Asia, abetted by a technologically linked world in which capital and ideas flow across borders at lightning speed. Traders in the West have long become accustomed to coping with world markets that trade 24/7, and ordinary citizens are feeling the stress as well. As the pace of daily life accelerates for citizens across the planet, there is one more piece of bad news: The Chilean earthquake is believed to have increased the speed of Earth's rotation, shortening the day by 1.26 millionths of a second due to the “ice-skaters” effect of moving mass closer to the axis of a rotating body.

That may not sound like a lot of time, but it may provide some relief to those who find themselves groggily banging on the snooze button tomorrow, wondering how morning could have come so quickly. If you fall into that category, you can relax. For once, it's not a figment of your imagination: Your alarm clock actually did wake you earlier than it did last week. It's merely fundamental physics.

Bernie McSherry serves as senior vice president of strategic initiatives at Cuttone & Company where he is a member of the management committee.
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