The rise of a great power: starting with military industry

Peace and development are the themes of the times!

This is a phrase that is familiar to everyone in China, and it is a judgment on the world pattern and development trend.

Liu Tao's words also mean that, at least in this region, peace and development are still universally applicable.

This is a kind of national will and also a kind of national confidence.

Except for military-industrial enterprises and war-related industries such as food, petrochemicals, and steel, which look forward to war, more companies actually do not like war and hate war.

Because war means that a large amount of resources will be invested in the war instead of in economic development and construction. Moreover, war will destroy the existing order, the entire production chain, sales channels, etc.

It can be said that for most people, war is more serious and more terrifying than economic crisis.

Liu Tao naturally understood these people's concerns.

To be honest, the higher-ups are also making relevant preparations. After all, only by fighting can a war be stopped. One slap in the face does not make a sound. If you don't want to start a war, but someone wants to impose it on you, then war is inevitable.

The current situation is indeed very bad.

Since the fifth largest investment bank in the United States, Bear Stearns, announced that its hedge fund would stop redemption, investors withdrew their capital, thus triggering a liquidity crisis. This can also be said to be a sign of the full outbreak of the US subprime mortgage crisis. The British Northern Rock Bank was nationalized by the British government. This was the first financial institution to be nationalized since the outbreak of the subprime mortgage crisis, and it also marked that the subprime mortgage crisis had spread to Europe.

Bear Stearns filed for bankruptcy and was acquired by JPMorgan Chase under the mediation of the Federal Reserve. The US government's rescue of Bear Stearns marked the beginning of a new phase in the subprime mortgage crisis and reinforced investors' expectations that financial institutions were too big to fail.

As the US government announced the takeover of Fannie Mae and Freddie Mac, it meant that a systemic crisis broke out in the US real estate financial market. As Lehman Brothers, the fourth largest investment bank in the US, filed for bankruptcy protection, the US government implemented a rescue and allowed Lehman Brothers to go bankrupt, which broke the financial market's expectation that financial institutions were "too big to fail" and directly caused the collapse of the US short-term money market.

Since the short-term money market is the most important source of financing for the US shadow banking system, the bankruptcy of Lehman Brothers made the collapse of US investment banks irreversible.

Shortly after the bankruptcy of Lehman Brothers, Merrill Lynch, the third largest investment bank in the United States, announced that it would be acquired by Bank of America. The top two investment banks in the United States, Goldman Sachs and Morgan Stanley, announced their transformation into bank holding companies. The five largest investment banks that were once powerful on Wall Street disappeared collectively.

In addition, the largest insurance company in the United States, American International Group (ALG), suffered severe losses and was eventually injected with $850 billion by the Federal Reserve and nationalized, which marked the beginning of the collapse of the credit default swap market.

It was also at this time that the crisis spread from the US financial market to the financial markets of Europe and emerging market countries, and the crisis officially transformed from a national crisis to a global financial market crisis.

The crisis in the financial market has also affected the global real economy through wealth effect, credit tightening, and cutting off corporate financing sources.

In 2008, it was no surprise that the economies of the Eurozone, Japan and the United States entered into negative growth.

Even after investing so much money in rescuing the market, it still failed to save the market, and the economy is still experiencing negative growth. One can imagine the huge losses involved.

The three major developed economies collectively fell into recession in 2008, and the economic growth of emerging market countries and developing countries naturally slowed down significantly.

According to forecasts from relevant agencies, the global economy will experience negative growth of 1.3% to 2%!

This would be the first time the global economy has contracted since World War II.

A bigger crisis is currently coming, and there are four crises overlapping with each other.

First, large American banks, represented by Citigroup and Bank of America, have suffered huge asset write-downs; second, the US hedge fund industry has been experiencing large-scale investor withdrawals; third, the real economy of developed countries is still declining; fourth, Central and Eastern European countries are likely to experience a financial crisis caused by the withdrawal of foreign capital. In fact, Central and Eastern European countries are already in danger at this time.

Such a huge economic crisis caught the whole world by surprise.

Faced with such a huge economic crisis, different countries have made different choices.

Some countries choose to lie low and just sit there, thinking that an economic crisis is an economic crisis. There is no extra money to rescue the market anyway. They just have to wait until the economic crisis is over and the world economy recovers, then things will naturally get better.

Some countries have sufficient financial resources and can actively rescue the market, and they will save as much as they can.

Some countries, however, will choose war to shift conflicts and plunder wealth through war.

This is why people in many countries around the world are worried about the outbreak of World War III.

Because of this scene, people can't help but think of the Great Depression of 1929 before World War II.

Everyone is worried that this time it will trigger a third world war just like the Second World War.

Especially in Europe, this concern is particularly strong!

Both world wars took place in Europe.

In World War I, 550 million Allied soldiers died, and 338 million Central Powers soldiers died. Almost 2000 million soldiers from both the Allied and Central Powers camps were injured, and the number of civilian casualties was also staggering.

It was also the First World War that led to the collapse and disintegration of the Austro-Hungarian Empire; the revolution broke out in Russia, which led to the birth of the Soviet Union; France suffered heavy casualties and was heartbroken, so much so that when World War II broke out, France performed exceptionally poorly; and Britain's world hegemony was seriously challenged.

In World War II, the casualties in Europe exceeded 3500 million, which was more than that in World War I. World War II caused Britain to lose its world hegemony, Britain and France withdrew from the hegemonic level, and the world entered the era of the US-Soviet hegemony.

If World War III breaks out this time, there is no doubt that the entire world situation will undergo earth-shaking changes. More importantly, because of nuclear weapons, the destructive power would be unimaginable.

This is also why Einstein's famous quote, nuclear weapons experiment videos, and the Soviet Union's 81st military exercise documentary have been broadcast over and over again in Europe, and countries such as Sweden and Switzerland have even issued radiation protection manuals.

All over the world, the trend of military preparation is on the rise.

Even though the United States is facing an economic crisis, its military budget has not decreased. The proportion of military spending in various countries is increasing.

Some geopolitical intersection areas have begun to show signs of turmoil.

Georgia is a very distinctive feature.

If Russia had not taken decisive military measures, defeated the Georgian army and forced Georgia to compromise, it would have inevitably caused a chain reaction.

But even so, the Franco-German alliance + Russia, which was originally getting closer, came to an abrupt end. There was a very subtle change in attitude, and the whole of Europe's vigilance against Russia suddenly increased. (End of this chapter)