New Book Explores Pending US Financial Crisis
The Mr. X Interviews, Volume 2 by Luke Gromen continues the US and world economic analysis begun in the first volume of interviews with Mr. X. Luke recounts his meetings with Mr. X, a fictional US sovereign creditor, invented for the purpose of creating a dialogue about the economy and the US’ future. This second volume analyzes in detail the financial issues and events of late 2017 to early 2019. The book’s opening quote, by Pulitzer Prize winning journalist Seymour Hersh, warns readers they are in for an eye-opening revelation: “It’s important to understand many important stories are always hiding in the open.”
The book begins with Luke and Mr. X’s first meeting over dinner. Mr. X opens the conversation by stating that China is no longer an emerging market, but investors are making a grave error by analyzing it as if it still were. Mr. X then launches into a discussion of how China would only be an emerging nation if oil continued to be priced in USDs. However, China is making the move now to price oil in its own currency, the CNY, and forcing other countries to take payments in its currency, which could devalue and weaken the USD. Mr. X is thorough in his discussion, always citing articles and his sources. One article he quotes states that what makes the US a superpower is really the position of the US dollar, and as China and Russia try to devalue the dollar by changing its international usage, the US’ power will crumble. Ultimately, Mr. X argues, Russia and China have us in checkmate over the price of gold. Furthermore, China and other countries are no longer paying the burden of US debt, so the US has to borrow from banks and US citizens.
Meanwhile, China is exchanging USDs for control of physical assets all over the world and moving to price those assets in its own currency. Mr. X fears that, in response, the US Fed and Treasury will weaponize the USD, which could ultimately destroy the global economy.
According to Mr. X, things look pretty financially bleak for the world. President Donald Trump has jeopardized the dollar’s supremacy, Europe’s biggest gas field is in decline and will halt production by 2030, and Russia is unlikely to survive as a state for many more years. Meanwhile, the US is losing the trade war with China and the decline of US life expectancy, driven by suicide, alcohol, drug overdoses, and chronic liver disease reflect “deaths of economic hopelessness.” Mr. X analyzes all these factors in his conversations with Luke, leading to his belief that the United States will have to compensate for its borrowing binge by printing more money in the 2020s.
Summing up this situation, he quotes former Federal Chairman Paul Volcker, who said in November 2018, “The US is in a hell of a mess in every direction.” Mr. X goes on to quote the former Greek Finance Minister Yanis Varoufakis, who said, “it is the very first time in human economic history or history in general that an empire is expanding its realm and its power and its strength and vitality by expanding its deficits. Usually when an empire has a deficit, it is the beginning of its decline. Not in the case of the United States.”
By the end of the book, Mr. X concludes that if authorities continue to weaken the USD, by the end of 2019, people might have to start taking money out of banks and stockpiling essentials in their basements.
The Mr. X Interviews, Volume 2 paints an eye-opening picture of the US economy over the last few years and into the future. Of course, Mr. X could not foresee the coronavirus pandemic that was to come a year after the book ends, but his analysis in these pages leaves much to ponder, and perhaps fear, about our current global economy, especially for Americans. It will be interesting to see what Mr. X has to say in Volume 3.
