MARKET PERSPECTIVE

By J Mulraj

May 29- Jun 6, 2025

Utterly Irresponsible Western Leadership Risks Armageddon

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The collective West, by ignoring Putin’s oft-repeated warning about a NATO membership grant to Ukraine (contravening a promise given to former Russian President Gorbachev that NATO wouldn’t expand eastwards), provoked Russia to invade Ukraine.

A few weeks into the invasion, a negotiated settlement, agreed to by both parties, was reached. One that would have prevented the senseless killings/injuries on both sides, the undesired destruction of properties and infra assets and the ruination of Ukrainian society because of emigration of its young male population. Guess what happened? The negotiated agreement of both parties of the war was scuttled by a party not involved in it; the right dishonorable Boris Johnson, ex PM of UK. Probably with encouragement of Biden; one can’t see him doing it suo moto. There should be a global investigation why Boris intervened to scuttle the agreement and why Zelenskyy was foolish enough to accept his suggestion. They are responsible for all the deaths and carnage that followed.

Their unsatiated jingoism led the collective west to blow up the Nordstrom pipeline, in order to ensure that it could never be used to supply cheap Russian gas to Europe. In effect, this act was punishing Russia for daring to invade Ukraine and simultaneously destroying the economies of European allies who were compelled to buy expensive Qatari and American LNG. Pulitzer Prize winner Seymour Hersh held the US responsible for the Nordstream ‘accident’.

With the  Nordstream pipeline gone, the western polity stupidly managed to achieve their worst nightmare! Russia turned to China to buy its gas, now that Europe wouldn’t. So a leader with dementia succeeded in making his two worst adversaries join hands. Truth is, verily, stranger than fiction; not even Frank  Kafka could have written such a script!

Without an endgame in sight, Biden, with some EU help, continued to fund Ukraine and to supply it with weapons. By so doing, the collective west has depleted its own stock of artillery shells so much that it would be unable to fight a war for more than a few weeks. Countries like Russia, China and India have manufacturing bases to produce artillery shells, but the West has reduced its capacity. Continued funding of a war that could easily have been avoided by a  nyet from NATO to Ukraine, has increased the debt burden of the collective west to dangerously high levels.

The insanity of global political leaders continues, unbelievably!

Under pressure from Trump, both Russia and Ukraine met in Istanbul to hold peace talks. But some countries, likely European leaders, desire, for reasons unknown, to derail the talks. Remember, ex British PM had derailed the peace agreement once. Here is one opinion on why these countries, with insanity driving common sense, wish to derail peace talks.

The reason this is insanity personified is because of the revised nuclear doctrine recently adopted by Russia. The new doctrine states that Russia would view any assistance (in planning, weaponry or information) provided to Ukraine, a non-nuclear state, by a country which is a nuclear state (such as US, UK and France) which attacks Russian nuclear assets, as this attack did, will be considered a nuclear attack on Russia, giving it the right to retaliate similarly.

Because of the stupidity of some of the above mentioned countries who facilitated the attack (Ukraine could not have planned nor executed it without their help), the world is at one minute to midnight of a nuclear Armageddon.

Even more inexplicable is the appointment by the United Nations Security Council (UNSC), whose main objective is to maintain international peace and security, of Pakistan as the Vice-Chair of its Anti Terrorism Committee! This destroys any remaining trust in UNSC as an institution and points to the degradation of thought amongst the global polity.

The insanity of global political leaders extends also to monetary imprudence. Politicians have two goals – first, to get elected, and second, to get re-elected. To achieve the second, they overspend, to honor the promises they made to get elected. Raising taxes to finance the overspending would defeat their second goal. So they borrow, to fund the overspending. Citizens are not alarmed at rising debt levels; they are more concerned about the price of eggs today.

So, today, global Government debt/global GDP is 94%. (If private debt of companies and individuals is included, the figure is a bizarre 237%).

As per IMF, the increasing debt is driven by 59 countries, whose combined share of global GDP is 80%. Government debt/GDP ratio will rise to 100% by the end of this decade.

Global debt (sovereign plus private) exceeds $ 320 trillion!!! Forty percent of this ($ 132 trillion) is due for repayment by 2027. So, thanks to irresponsible leaders we are headed either for a nuclear Armageddon or a financial one!

But Trump has added another time bomb to this, launching a tariff war, setting them so unreasonably high that neither the exporter nor the importer, nor yet both combined, can pay them. Other countries, notably China, are pushing back. China, eg, has stopped supply of rare earths, and related magnets, which has badly hit the global automobile industry.

The result? As per this video, 5 highly regarded US companies are threatening to shut down/leave because of the uncertainties of the tariff wars and costs of doing business. These are storied names like Walmart, Harley Davidson, GM, Nike and Caterpillar. So, besides nuclear and financial Armageddon’s, there is a trade war doomsday scenario. Things have been made worse by a public spat between erstwhile friends – Donald Trump and Elon Musk. Musk criticises the new ‘one big beautiful bill Act’ that Elon warns would increase the deficit by $ 2.4 trillion! Trump threatened to turn on Elon’s companies, causing a sharp drop in Tesla’s stock price.

All these spats and outbursts do not bode well for the world’s largest economy.

Last week the BSE Sensex closed at 82176, for a weekly gain of 725 points.

The Doomsday clock reads 89 seconds to midnight! It is well past high time for the global polity to wind it back, cool their jingoistic rhetoric, and to negotiate an end to conflicts in Ukraine, Middle East and elsewhere. The alternative is unthinkable.

Comments may be sent to jmulraj@asiaconverge.com