Best of the Week
Most Popular
1. The Trump Stock Market Trap May Be Triggered - Barry_M_Ferguson
2.Why are Central Banks Buying Gold and Dumping Dollars? - Richard_Mills
3.US China War - Thucydides Trap and gold - Richard_Mills
4.Gold Price Trend Forcast to End September 2019 - Nadeem_Walayat
5.Money Saving Kids Gardening Growing Giant Sunflowers Summer Fun - Anika_Walayat
6.US Dollar Breakdown Begins, Gold Price to Bolt Higher - Jim_Willie_CB
7.INTEL (INTC) Stock Investing to Profit From AI Machine Learning Boom - Nadeem_Walayat
8.Will Google AI Kill Us? Man vs Machine Intelligence - N_Walayat
9.US Prepares for Currency War with China - Richard_Mills
10.Gold Price Epochal Breakout Will Not Be Negated by a Correction - Clive Maund
Last 7 days
When A 16-Year-Old Earns $3 Million, You Know It's Not A 'Silly Fad' - 24th Aug 19
The Central Bank Time Machine - 23rd Aug 19
Stock Market August Breakdown Prediction and Analysis - 23rd Aug 19
U.S. To “Drown The World” In Oil - 23rd Aug 19
Modern Monetary Theory Could Destroy America - 23rd Aug 19
Seven Key Words That Explain "Stupidly High" Bond Market Prices - 23rd Aug 19
Is the Fed Too Late Prevent A US Housing Bear Market? - 23rd Aug 19
Manchester Airport FREE Drop Off Area Service at JetParks 1 - Video - 23rd Aug 19
Gold Price Trend Validation - 22nd Aug 19
Economist Lays Out the Next Step to Wonderland for the Fed - 22nd Aug 19
GCSE Exam Results Day Shock! How to Get 9 A*'s Grade 9's in England and Maths - 22nd Aug 19
KEY WEEK FOR US MARKETS, GOLD, AND OIL - Audio Analysis - 22nd Aug 19
USD/JPY, USD/CHF, GBP/USD Currency Pairs to Watch Prior to FOMC Minutes and Jackson Hole - 22nd Aug 19
Fed Too Late To Prevent US Real Estate Market Crash? - 22nd Aug 19
Retail Sector Isn’t Dead. It’s Growing and Pays 6%+ Dividends - 22nd Aug 19
FREE Access EWI's Financial Market Forecasting Service - 22nd Aug 19
Benefits of Acrobits Softphone - 22nd Aug 19
How to Protect Your Site from Bots & Spam? - 21st Aug 19
Fed Too Late To Prevent A US Housing Market Crash? - 21st Aug 19
Gold and the Cracks in the U.S., Japan and Germany’s Economic Data - 21st Aug 19
The Gold Rush of 2019 - 21st Aug 19
How to Play Interest Rates in US Real Estate - 21st Aug 19
Stocks Likely to Breakout Instead of Gold - 21st Aug 19
Top 6 Tips to Attract Followers On SoundCloud - 21st Aug 19
WAYS TO SECURE YOUR FINANCIAL FUTURE - 21st Aug 19
Holiday Nightmares - Your Caravan is Missing! - 21st Aug 19
UK House Building and House Prices Trend Forecast - 20th Aug 19
The Next Stock Market Breakdown And The Setup - 20th Aug 19
5 Ways to Save by Using a Mortgage Broker - 20th Aug 19
Is This Time Different? Predictive Power of the Yield Curve and Gold - 19th Aug 19
New Dawn for the iGaming Industry in the United States - 19th Aug 19
Gold Set to Correct but Internals Remain Bullish - 19th Aug 19
Stock Market Correction Continues - 19th Aug 19
The Number One Gold Stock Of 2019 - 19th Aug 19
The State of the Financial Union - 18th Aug 19
The Nuts and Bolts: Yield Inversion Says Recession is Coming But it May take 24 months - 18th Aug 19
Markets August 19 Turn Date is Tomorrow – Are You Ready? - 18th Aug 19
JOHNSON AND JOHNSON - JNJ for Life Extension Pharma Stocks Investing - 17th Aug 19
Negative Bond Market Yields Tell A Story Of Shifting Economic Stock Market Leadership - 17th Aug 19
Is Stock Market About to Crash? Three Charts That Suggest It’s Possible - 17th Aug 19
It’s Time For Colombia To Dump The Peso - 17th Aug 19
Gold & Silver Stand Strong amid Stock Volatility & Falling Rates - 16th Aug 19
Gold Mining Stocks Q2’19 Fundamentals - 16th Aug 19
Silver, Transports, and Dow Jones Index At Targets – What Direct Next? - 16th Aug 19
When the US Bond Market Bubble Blows Up! - 16th Aug 19
Dark days are closing in on Apple - 16th Aug 19
Precious Metals Gone Wild! Reaching Initial Targets – Now What’s Next - 16th Aug 19
US Government Is Beholden To The Fed; And Vice-Versa - 15th Aug 19
GBP vs USD Forex Pair Swings Into Focus Amid Brexit Chaos - 15th Aug 19
US Negative Interest Rates Go Mainstream - With Some Glaring Omissions - 15th Aug 19
GOLD BULL RUN TREND ANALYSIS - 15th Aug 19
US Stock Market Could Fall 12% to 25% - 15th Aug 19
A Level Exam Results School Live Reaction Shock 2019! - 15th Aug 19
It's Time to Get Serious about Silver - 15th Aug 19
The EagleFX Beginners Guide – Financial Markets - 15th Aug 19

Market Oracle FREE Newsletter

The No 1 Gold Stock for 2019

Here’s Why This G20 Meeting Doesn’t Really Matter

Politics / Global Economy Jul 06, 2017 - 06:41 PM GMT

By: John_Mauldin

Politics

BY GEORGE FRIEDMAN : Anyone who has ever been to a meeting knows that meetings are often confounding, frustrating affairs. Most of them are designed simply to be held. The people who attend them are unlikely to agree on anything except maybe the date of the next one.

The G-20 summit is no exception.

But that’s only because the people who attend it, the leaders of the countries with the world’s 20 largest economies, think of themselves as decision-makers when really they are hostages to history.


World leaders may not like Donald Trump. In fact, many do not. But since the US is still the world’s only superpower, they cannot avoid dealing with its president.

The US is linked to three major issues that will be addressed but probably not resolved at the G-20 summit.

The North Korea Issue

The first is the progression of North Korea’s nuclear weapons program (read more about North Korea’s strategy here), an issue the United States and China simply cannot ignore or fully resolve without at least talking to each other.

On July 4, Pyongyang tested a missile it claims was an intercontinental ballistic missile (ICBM). The North Koreans may be exaggerating, of course. The missile still needs guidance systems and a configured payload. But the United States can’t wait for North Korea to have a functional ICBM.

Here again, personalities matter less than imperatives.

The Trump administration had supposedly planned for an economic confrontation with China. But now that Washington needs Beijing to persuade North Korea to abandon its nuclear weapons program, the reckoning has been put off.

So far the talks have been futile, and it’s unclear if China even wants them to succeed (read more about China’s strategy here). If the US attacks North Korea, China could get what it wants—North Korea without a nuclear weapon—without lifting a finger. Not only that, it would have an opportunity to play peacekeeper against the US afterward.

In the meantime, Chinese President Xi Jinping will promise to try harder to disarm North Korea. It will strengthen his case if the US attacks while he is “negotiating.”

Washington probably sees the setup but can’t really get around it; it will simply remember this later. After the North Korea issue is resolved one way or the other, it will shift its attention back to Beijing. After all, the US can damage the Chinese economy far more than China can harm the American economy.

Russian Interference

The second issue is Russian interference in other countries (read more about Russia’s strategy here). It’s a hot-button issue that omits some obvious facts: Nations interfere with other nations all the time, and the Russians have a long history of agitation and propaganda.

Moscow has interfered in the domestic affairs of former Soviet states that lay west of Russia. Although quietly, Russia claims these are justifiable responses to the “color revolutions” of Eastern Europe in the 2000s, funded by US nongovernmental organizations.

In any case, the bigger issue for Russia is that its oil is cheap, and that cheap oil will continue to hurt the Russian economy. Nothing coming out of the meeting will change that.

No Longer “Friends” with Germany

The third issue is US-German relations (read more about the crisis of exporters that plagues Germany here). The party of Chancellor Angela Merkel no longer uses the word “friend” to describe the United States in its platform. But in fact, Merkel has blamed Trump for a rupture he has little to do with.

At issue are the national interests of both countries. Germany needs for the European Union to be economically healthy enough to buy the exports on which its economy depends. But the US, which has little stake in the EU, sees its disintegration as a European problem.

And so Washington has been working with countries like the United Kingdom and Eastern European states on a bilateral basis to contain Russia, rather than going through Brussels.

Germany also wants to be in NATO and the EU, but both organizations have a hard time instituting policies that benefit all their members, because none of their members have identical national interests.

And then there is Russia.

The last thing Germany wants to do, in light of its other problems, is confront Russia, but blocking Russia is central to US policy, and it needs Europe united in that regard.

The divergence between the United States and Germany has been growing since 2008, and there is little Trump could have done to change things.

What Leaders Do Rarely Matters

World leaders take their relationships with other world leaders very seriously. To them, their relationships with their peers define their national interest.

Though this line of thinking is misguided, it has its benefits, given Trump’s apparent unpopularity. Xi will blame Trump for disrupting a nearly successful peace process in North Korea.

Putin, in an effort to dispel rumors of collusion, will blame Trump for conspiracies against Russia. Merkel will blame him for disrupting US-German relations.

Trump’s personality, however, will no more define what happens at the G-20 summit than his healthcare views will define what emerges from Congress.

Grab George Friedman's Exclusive eBook, The World Explained in Maps

The World Explained in Maps reveals the panorama of geopolitical landscapes influencing today's governments and global financial systems. Don't miss this chance to prepare for the year ahead with the straight facts about every major country’s and region's current geopolitical climate. You won't find political rhetoric or media hype here.

The World Explained in Maps is an essential guide for every investor as 2017 takes shape. Get your copy now—free!

John Mauldin Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules