Predictive History - The Story of "Civilization", "Secret History", "Game Theory" and more - Game Theory #27: Putin Enters The Chat

Episode Date: May 22, 2026

Game Theory #27: Putin Enters The Chat

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Wayfair, every style, every home. A couple of quick announcements before we start class. Next Thursday will be our last class, and we will do the final examination next Thursday. It'll be the same format as the midterm examination where you can prepare some questions and we will review what we've learned so far in class. If you are on YouTube and you want to ask some questions,

please leave the question behind in the comment section and my wife will go over and select some questions for us to do next Thursday. Next Tuesday, we will do an overview of everyone we've learned so far and make certain predictions about the next five. 10 years, okay? So next week will be our last week. Today I want to talk about Putin in Beijing. So he came to Beijing Tuesday evening. He had a full day yesterday and then he left

last night. And as you can see, President Putin and President C are very good friends. They went to to a conference hall where they unveiled a photo of the two being very close. This is President Putin's 25th visit to China, and in November he's coming back to Xinjiang to attend APAC, and that will be 26. He's a very good friend of China's, and the two are very close. This is the two of them at an education conference announcing a year of education exchange between Russia and China. And the goal is to enhance people-to-people connections between China and Russia.

The major output of the meeting was their different perspectives on the multipolar world. Okay, so this is a part of President C's speech, and this is part of President Putin's speech. And this is actually AI translation, so the translation is very bad, but I would point out certain things, okay? So both are committed to a multipolar world.

And what President C and President Putin both want are more exchanges, okay, bilateral student exchanges, deepen in actions in universities, do more research together. He also is afraid of the turbulence in the world, and he's very much afraid of a return to the law of the jungle where might is right. So it's very important for the world to work together

in order to maintain the rules based in national order. And what President C says is that as permanent members of the UN Security Council, China and Russia will work together to uphold the authority of the UN international justice and oppose all manifestations of unilateralism and hegemony, resurrecting signs of fascism and militarism. Okay? And this specifically refers to Germany and Japan. Okay? So he sees the possibility of nationalism, a research of nationalism in Japan as a threat to the peace in East Asia and to the world in general. Okay, so China is most resolutely opposed to the remilitarization of Japan.

Putin says the same thing, same things almost, but the tone is very different, okay? So, first of all, Putin is much, actually, more specific than Presidency about areas of cooperation. So for example, the Tenth, Russia, China, summer games, and also cooperation between different media outlets. And he also talks about how it's a lot important to maintain independent autonomous foreign policies at the same time work

together to stabilize the global stage. Working together for peace and universal prosperity, there's a logic behind Moscow and Beijing's joint defense of international law and provisions of the UN Charter in their entirety comprehensive and interrelationship. So it sounds like there's in the same thing, but again the emphasis is different. Whereas in China, China is very much focused on making the status quo, a rule-based national order, putting the UN at the very top, and for the UN, China and Russia will work towards ensuring global stability. For President Putin, what's important is that China and Russia take the lead in leading the multipolar world. So these are two very different conceptions of how the world should.

should be run. Where the Chinese system is, let's just maintain what things are and will play a supportive role. Whereas Putin is like, no, Russian China should be the leaders of this new multipolar world. China can be the leader and will be a junior partner, but we need to take the initiative in promoting global stability. This is much more clearer, okay? This is actually a joint statement between Russia and China, where they advocate

multipolar world and Russia and China undertake and call on the national community to adhere to the following basic principles in the relation with one another. Number one, maintaining open trade, maintaining sovereignty of different nations, maintaining decision-making for consensus, okay? Parliamentary the United Nations, maintaining authority of the UN, and respecting the civilizations of each different nation-state. So, refusing to prioritize one civilization over another. All right, so this is something that both Russia and China agreed to. Now, this is actually a much better translation of President

C's words about the multieth to a polar world. Okay? So let's read it together. The world today is far from tranquil. Unilateralism and hedgermanism are doing grave harm and the world faces the danger of sliding back to the law of the jungle. As permanent members of the UN Security Council, China and Russia must firmly carry out the

mission and responsibility of major countries defending authority on their nation's international fairness and justice oppose all unilateral bullying and acts that turn the world of history backward and especially oppose all provocations. that negate the victorious outcomes of World War II or that seek to reverse the verdict on and southern back the spirits of fascism and militarism, certainly pushing for the building of a more just and reasonable global governance system.

Okay? All right, so this is a lot of words, but I will emphasize certain takeaways. First of all, what President C is saying is that there were three major winners of World War II. The United States, Russia, and China. And we must ensure that these three nations who won war two are still in charge, okay? Okay, this is really important to understand.

First of all, U.S., Russia, and China are allies, not enemies, right? Because right now a lot of people think that China and the United States are in competition to rule the world, and President C. says, no, that's not true. We're allies because we won World War II together. All right? Second, he sees the real enemies as those who are trying to overturn the World War II order. And those nations, of course, are Japan, Germany, and Israel. I saw my friend on the other side of the street.

I was heading to school with the kids. I let go of Mom's hand to wave. I had already forgotten their lunches. I ran over to hug her. She came out of nowhere. And then... It stopped. Sometimes the moments that never happen matter most.

Volvo's automatic emergency braking helps ensure a safe ending for everyone. Learn more at VolvoCars.caps.caps.caps.caps.ca. And the last thing he will point out is that all unanimatism and hedgmentism are bad. Okay? If you act by yourself and you declare war against other nations, that's bad. So obviously the United States attacking Venezuela is bad. Obviously, the United States attacking Iran is bad. But what about Russia attacking Ukraine?

Well, according to this framework, this is also bad. Okay? According to this logic of what he said specifically, this is also bad. So it seems as though China and Russia are best friends and they will unify against the United States together. But this statement reveals that actually things aren't as simple as they seem. All right? Also, what's important for us to understand is that, yes,

there are many areas where China and Russia can work together, but the cooperation is not going as smoothly as one would imagine. So let's look at some examples. First of all, the economic cooperation between China and the United States, it is booming. What's happening is that China needs a lot of energy and resources from Russia. So you would think that they would build infrastructure as soon as possible to make this trade as smooth as possible, right? Especially with this war going on in the Middle East, blocking China's access to the Middle East. energy. But, and the main pillar of this cooperation is something called the Power Siberia 2.

As you can see, it extends all the way from the north of Russia to Shanghai. It's a huge project. And everyone assumed that at this meeting, the first thing that they would accomplish is signing an MOU agreement to build this pipeline. and they have not done so. And a lot of it is because China does not want to become too dependent on Russia. Because obviously if you build this pipeline, then you must buy a lot of energy from Russia. But they want to still negotiate over the price as well as the volume. So that's one area. Second area is Iran.

As you can see, the Russians are, The Russians are absolutely supportive of the Iranians, right? So what Vladimir Putin says is this absolute unprovoked aggression of U.S. bombing against Iran has no basis and no certification whatsoever. For our part, we are making our efforts to assist the Iranian people. Okay, so this is this was last June actually when America bombed Iran. The Chinese, on the other hand, are much more nuanced and much more diplomatic. So President C says, Israel's military operation against Iran has caused a sudden escalation of tensions in the Middle East. Middle conflicts are not the solution of problems.

So the Chinese are much more muted. And it shows us that whereas the Russians are much more clear about their regional alliances, China does not want to participate in disputes among different nations. Okay? All right. So one era of cooperation between Russia and China is trade routes. All right? So as we discussed previously in this class, what the Americans want to do is they want to block China from accessing global trade.

And they can do that by closing off the Strait of Malacca. Okay, and there's something called a Malacca dilemma for China, where if the American were to close off the Strait of Malacca, Chinese trade would collapse. So the solution is for China to build another route to the north, called the northern seat route of Russia. But the problem with this is that now you're completely dependent on the Russians

because you're going through Russian territory. So it's not an advantage of China to say, you know what, screw you America, we're going to work with the Russians. They're actually better off balance-south, Russia and China. That way, they keep both of these roots open. This is the most economical. This is the most strategic way of accessing global trade.

Okay. But the further you look, there are certain tension points in the relationship between Russia and China. First of all, this relationship clearly favors China. So this is a map, a chart of Russia exports to China. And as you can see, it's mainly just energy, coal, LNG, crude oil. That's the extent of Russia's exports to China.

And what does China export to Russia? Mainly vehicles, electronics, and machinery. So basically what China does is it takes Russian research. resources, converts them into manufacturing goods, machinery in its factories, and then exports it back to Russia. This is a very bad deal for Russia. It's a good thing for China, but it's a bad deal for Russia, okay? So that's one point of tension. Another point of tension is the dependence, okay? So basically China, China and Russia Russia may be best friends, but look at this, okay?

So Russia's share and Chinese imports is only 5%. And then Russia's share in Chinese exports is only 3%. So economically, Russia and China are not that close. The problem though is that Russia is technically dependent on its relationship with China because all these economic sanctions imposed on it by the West. So as you can see, what's happened after February 2020, 22, when Putin invaded Ukraine and the West imposed sanctions on Russia, the relationship, the economic dependence on China has increased a lot

where in the beginning of the war, Russia didn't have that much in Rueing B. But now, Droom V accounts for over 40% of Russian imports. Okay? All right. Another thing is that Chinese investors aren't that interested in going to Russia and investing in Russia. Okay? So before the war, this is the war, okay? This is the war.

there was some, okay, but there weren't that many. And then as you can see, after the war, it dropped precipitously. Okay, so why, and as you can see from this map, okay, maybe the Chinese are in the Russian far east. And that makes sense because it's close to China. But as you can see, the further you go out, okay, here, there's really no real investment. Chinese aren't that interested in investing in Russia. And why is that? Well, there are different reasons.

We can speculate, okay? The first reason, and this is really important, is that the Chinese are respecting Western sanctions on Russia. If you do business with the Russians, then the West can choose to debank you, remove you from the global financial system. And Chinese investors care more about their relationship with the West, West, then they did they care about with Russia, okay? That's point one. Point two is that

Russia is not that friendly to foreign investors. Russia is very much a closed system and it's very hard to do business in Russia. If you're in United States and you put your money in the United States, you know you'll be protected legally and contractually. If the person screws you over, you can go sue the person in a court of law and you can probably win the case. Whereas in Russia, well, if you get screwed over, too bad, okay? Russia is still very much a mafia system. Then the third reason, and this is actually something that is really problematic, is that Chinese are much more interested in USD than they are in the ruble. Okay? They're much more interested in accumulating US dollars than they are in ruble. And this is the central dilemma

of the U.S., sorry, of the Russia-China relationship, where yes, you can get Chinese to go visit Russia, you can announce a lot of cooperation. But at the end of the day, Chinese investors want USD and not ruble. Okay? Here's another chart where, yes, okay, as you can see, Chinese are going, more and more Chinese are going to Russia. Okay? All right.

So right now you have about 50,000 Chinese studying in Russia. But this does not compare at all to the Americans where the, when, when, when, when, When Chinese have enough money to go study in America, starting in 2008, you can see a huge boom, okay? Right? There's maybe 60,000 Chinese who are learning Russian in China. Well, everyone else is learning English. Okay? So at the end of the day, Chinese people are much more interested in the West than they are in Russia.

So in other words, the relationship between Russia and China seems to be top-down, where it's mandated from the government. But the relationship between the United States and China seems to be bottom-up, where people are choosing to work with the Americans. And so this is not really an equal relationship. So what I want to look at today is why is this a case? Why is it that the Chinese want to go to America and what can put in do about it? And what will put it and do about it. So these are the two questions that we're going to look at.

First of all, why is the relationship like this? Second of all, what is putting strategy of dealing with this? Okay. All right. So to answer this, we need to go back to World War II. So this is the end of the World War II and America has won the war, okay? So this is the United States, USA, this is Europe, and this is East Asia, okay? Japan, basically, but also Taiwan and Korea. Okay, all right.

So, war war two has ended, and the United States has a problem. It's got all these factories that produce tanks. machine guns, airplanes. And now the war is over. So what are you to do with these factories? You can't just tell everyone to go home and not work, okay? So they make a deal with the Europeans and these Asians. Basically, the deal is this.

The Europeans will agree to buy manufacture goods from the Americans, television sets, radio, bicycles, cars. But then the Europeans and the Japanese are like, we don't have any money. And the Americans are like, don't worry, we'll lend you the money. Okay? Not only will we give you the goods, but we'll lend you the money to buy the goods. Okay, and this is, and of course the money is the US dollar.

So the US dollar is basically a contract, right? And because the Americans are lending US dollars to the Europeans and the Japanese and the East Asians, they want the US dollars to be actually worth something, right? So the US dollars is pegged to gold, the gold standard. Meaning, the Americans can at any time force the Japanese and Europeans to get their gold in exchange for the US dollars. Does that make sense? And so this is a really good deal for the Americans. And this is what we call the Bread and Wood system, okay?

Breadden and Woods, 1944, where the Americans were to facilitate global trade in order to maintain your manufacturing power, and they would lend other nations the U.S. dollars to participate in this trade, and U.S. dollars would be backed by gold. Okay? So from 1950 to 1970, this was a great deal for America. And this led to probably the greatest wealth creation in the world where if you were just like a average white American male, you got the best life possible. Okay, this led to tremendous prosperity in America. but with prosperity comes corruption and complacency. Okay?

So what happened was that the Americans start to work hard, but then the Europeans and the Japanese are like, we need to work harder because we need to rebuild ourselves, and we need to pay off this American debt, okay? So Europe started to work really hard, the Japanese work really harder. And then what happened was that the Europeans and the Japanese start to make products that were actually not only cheaper,

then the Americans could make, but also better. Okay? So then when it started to happen was that instead of America lending money to the Europeans and the Japanese to buy things from them, they start to borrow money in order to purchase the European and Japanese manufacturer goods, okay? So now this relationship goes backwards. All right. Now, USA went from a credit nation to a debtor nation to a

detonation. But not only that, but the Americans recognize that, you know what, we can print as much money as we want so we can spend as much money as we want. And so the Americans started to do stupid things, like start a war in Vietnam that it could not win, like send a man to the moon for no particular reason, like, and the American started to spend way too much money. And by 1970, the entire world recognized that, you know what, America owes us a lot of money, but they probably can't pay it off with gold. Okay? And in 1971, Richard Nixon says, you're absolutely right, okay?

We can't pay you off with gold, so we're going to move off the gold standard. Okay, so let's go get a problem now because everyone's sitting on this US dollar and it's actually worth nothing. So to solve this problem, what Nixon did was he brought in to the system, and he's The GCC, Saudi Arabia basically, as well as China, to create more demand for the US dollar. So this created the petrol dollar. Because from now on, Saudi Arabia would only sell its oil in US dollars. So this kept the system going.

The thing to appreciate about this is the American's did this not because it was strategic, not because it showed long-term thinking, but because the Americans by now had become addicted to the US dollar. Do you understand this idea? This is really important for you guys to understand. At this point in history, the US dollar was the global reserve currency. The global reserve currency is unique in human history. We've never had the idea of a global reserve currency where one currency could be the basis for value of all other currencies. Never has this happened before. What had happened? Because of an accident of World War II, where the Americans won and can impose their system on everyone else. And before it's tied to gold

and they went off the gold standard. So this is a complete accent of history. And it's terrible for America for many reasons, okay? The first reason is that it's the guarantor of global trade. What does that mean that guarantee of global trade? Well, first of all, it means you have to print a lot of U.S. dollars, okay? Access liquidity. Okay? You have to print a lot of U.S. dollars so people can use U.S. dollars, and this causes inflation in your system. And it's hard to manage, okay? Second problem is something called an open capital account. What is the open capital account means? It means like I can change the US dollar anytime I want. So many can come in the country, but it can also flee the country.

Okay, and that's really problematic if you're trying to control a nation's currency. All right? And the third thing is financialization where because there's so much demand for US dollars because US dollars is so complex to manage your economy shifts from manufacturing to financialization. Financialization just means gambling, okay? So this has been terrible for America, the American economy. The problem is that once you have easy money, it becomes addictive. Okay, and so the way to protect the system is by expansion, war. You don't care if Expanding your system makes any sense.

You don't care if expanding your system is good for your nation. All you want to do is expand it in order to create more demand for your dollar because you're so addicted to it. And you have to, you go fight wars in order to protect the U.S. dollar. So this is what leads us to China. So to create China, what America did was destroy its middle class and transfer its manufacturing sector to China. It gave China technology. capital as well as market access okay and the entire intention was to create more demand for the US dollar okay and this also explains the war in Iran where Iran is

not part of the system and so America wants to destroy Iran in order to make everyone else more dependent on the system okay all right now Why did China agree to participate in the system? Because the US dollar solved for China a huge problem. Huge problem is this. The US dollar, I need you guys to appreciate this, it monetized, okay? So I'm an elite in China, and I control millions of people.

But so what? Who cares? What the US dollar did was it enabled me to monetize my power. Meaning now that I could take this power and store its value in the US dollar and then export it to the United States where it would be safe. Does that make sense to you guys? Okay? This is what it did. It monetized power in China. Now the elite could use their power of the people and get rich in America.

Okay? So in other words, there were two major beneficiaries of this system that was created, even though this system doesn't really make any sense. The first, of course, is the American elite, the American financial lead, and second is the Chinese political elite. Okay? And this explains why it's so hard for Putin and for Russia to form an alliance with

China. Because the elite, the mentality is to use the power and monetize it through the US dollar. So what matters is the US dollar, not the relationship with Russia. Okay? Does that make sense? Any questions so far? Yeah. So I think like it also aligns with the like the international education of Chinese, which the rich people and the elite, that they send their kids to America, but not Russia. Yeah, that's exactly right, okay? So if you think about it, the entire point of society in China right now

is to generate as much U.S. dollars as possible. Okay? So sending a child to the United States in order to learn English in order to get the American degree in order to accountatize to American society is part of the strategy. Okay? Do you understand? Because the women by itself has no value.

If you convert Riembe into as dollars, that has value. Okay? Doesn't make sense. Okay, so that's what explains the relationship between the United States and China and why it's so hard for Russia to break into this relationship. There's actually nothing that Russia can offer the Chinese elite. All right? Okay.

In fact, the Chinese elite think Russia is a problem because of its militarism, the world, all right? So Putin's, so Putin, if he wants to establish a new world order, what he needs to do is only destroy the US dollar as the global reserve currency. Okay, that is his mission, that is his game. If he really wants to destroy the American Empire, he needs to destroy the value of the US dollar. Okay, and the way he does that is is by destroying demand for the US dollar. It doesn't make sense.

All right. So we're gonna go over Putin's game, his grand plan to destroy the US dollar. Okay, actually, before I do that, one thing that I need to make clear to you guys is that not all Americans think this is a good thing that the United States has a world reserve currency. In fact, most Americans, if you explain

system to them to be like, yeah, we don't want to be the world reserve currency because, one, it causes corruption, it causes all these corrupt people to come to our country, it causes all these illegal immigrants to come to our country, it causes us to go fight wars in Iran, it causes us to support Israel. So yeah, we don't want to be the world reserve currency. The problem though is that they're addicted to it because it's such easy money, okay? So this is a contradiction. On one hand, the Americans know that the world's

reserve currency is back for them, but on the other hand, they're addicted to it, okay? So America is basically a drug addict. And so what do you do? Well, the only thing you can do is something called a force withdrawal, okay? A force withdrawal, which means that you just deny America's capacity to print money, okay? And the way you do that is by destroying global demand for the US dollar. Does that make sense? This will cost a lot of pain in America in a short term, basically economic depression, civil war. In the long term, this may be the only solution to save America.

Okay? All right. So let's go over Putin's grand strategy for destroying the U.S. dollar. I will also point out that, of all the world leaders in the world, I would say only Vladimir Putin seems to be strategic, okay?

The guy actually is able to think long term and execute with perfect timing. He's a chess player, okay? And he's really the only world leader that's able to think so far ahead and plan so strategically. So let's go over his strategy. Basically, his strategy is very simple. There are lots of different nations that have been sanctioned by the Americans. How can I form a relationship with these nation states? in order to create volatility in the world to destabilize global trade and therefore

destabilize US dollar okay also there are some nation states that participate in the system but we're not happy about the system so how can I actually break them away from dependence on America all right so these are nations that have been sanctioned by the Americans including Russia Iran okay North Korea, Venezuela, Syria, Belarus, Myanmar. Okay? So, Myanmar is a civil war. Forget about them.

Venezuela has been conquered by the American. Syria is destroyed, okay? So basically, there are four countries left, Russia, Belarus, Iran, North Korea. So these four are going to work together in order to destabilize the global order in order to destroy the American empire, okay? All right. So the key is Iran and North Korea. Korea. We've heard about Iran, so today I want to talk more about North Korea. So, um,

right now, Russia and North Korea have become very, very close. So last year, sorry, sorry, this is actually two years ago. June, uh, 24, Putin visited North Korea and sign a mutual defense pact with North Korea. This is a very, very big deal because what a mutual defense pact means, is that in the case that North Korea is attacked, Russia must militarily come to the defense of North Korea. If Russia is attacked, North Korea must come to the fence of Russia. Okay? This is a big deal because previously North Korea had a mutual defense path with China,

signed in 1961, after the Korean War. And so you would think that, So you would think that North Korea doesn't really need Russia because North Korea already has China to protect it. So why is Vladimir Putin signing a mutual defense path with Kim Jong-un? This is very strange. Okay? Well, I think if we wait a couple of years, we'll know the answer.

All right. Another thing to keep in mind is that Kim Jong-un-un has been very supportive of Russia's war in Ukraine. In fact, he sent 10,000 troops to Ukraine. And the thing about the North Koreans is that at first, they're not very well trained. They're not very disciplined. But the thing about the North Koreans is they fight to the end. They have a policy of not surrendering to the enemy. If you do surrender to the enemy, guess what happens to your family back in North Korea?

So the thing about the North Koreans remember is that, yes, they're poor, they're not technologically sophisticated, but their soldiers are willing to fight to the better end. And that's actually the key to winning a war. All right. So everyone makes fun of North Korea, because it's a very poor place. So if you compare North Korea to South Korea, the GDP per person is only $7.71, okay? That's it. That's it. Whereas in North Korea, it's over 33,000.

It's one of the highest in the world. Look at this map, okay, of a satellite image of the Korean peninsula at night. This is South Korea, okay? This is North Korea. Pretty big difference, guys. Huge difference, right? But in a war, this place would defeat this place. Okay? Why? Because in this class, what you taught is game theory.

And if you look at how wars are fought and who wins wars, societies that win wars have three characteristics, okay? They have energy, they're open, and they have cohesion. Now, what's important for us to understand is that the poorer you are, the more likely you are to be energetic, open, and cohesive. Okay? And you're like, that's retarded. South Korea is wealthy. That's technology.

It has a lot of weaponry. That's American support. The problem with Western capitalistic societies is that they tend to be very individualistic. as well as complacent and unequal. Okay? You can tell because of the birth rate, right? Where in North Korea, the fertility rate is still 1.81. It's not great, but look at South Korea, 0.81.

Okay? So in 50 years time, South Korea will lose 80% of its people. people. North Korea will also lose people, but just if there's no war, if we just keep on going, eventually South Korea will go to zero and North Korea will still be around, okay? But the other difference is that when you're poor, you're not afraid to die, right? You have nothing to lose. Whereas if you're rich, well, you want to live, okay? So all North Korea has to do is basically say, you know what, we have artillery. And this is Seoul, okay? You can see how close Seoul is to the border. So all North Korea has to do is tell the Koreans,

you either pay us a lot of money or we'll go attack you. Right? It's that simple. And the sub-Quaans will be like, we'll give you money. Just please don't attack us. And what this is going to do is create a lot of tension in Southeast Asia. it's going to have to bring in Japan as well, as well as the United States. Okay, so now Putin's defense pact with North Korea makes a lot of sense. Because if North Korea just creates a problem in the Korean Peninsula, this is going to be a huge problem for Japan and United States. And remember, the United States is already distracted in Iraq.

It doesn't have the forces in order to defend South Korea. Okay? This is going to create a lot instability. All right, let's move on. Germany, guys. Okay, so after Russia invaded Ukraine, Europe and the United States responded by imposing sanctions on Russia. The problem is that Germany was dependent on cheap Russian energy to fuel its economy. And because you lost this Russian energy, he had no choice now but to buy American LNG at 50% more. 50% markup, okay?

You can tell from this chart the impact on Europe's economy where, okay, in 2019, they wouldn't buy that much from the Americans, but by 2025, they're buying a lot from the Americans. And again, this is 50% more than Russian LNG. This has been terrible for especially the German economy, okay? So this is the red, the dark red is, are the Germans, okay? And as you can see, the decline has been pretty steep. Far more steep, steep, the French, the Italians, the Spanish, and the British. So the Germans are really hurting from this war. Okay, all right.

The other thing is that there's been a lot of immigration to Europe. Okay, so in certain places of Europe, especially Scandinavia, the population of immigrants has gone as high as 20% in Sweden. Germany is also under a lot of stress. So there are two, these two trends, okay? More immigrants coming to Europe,

which is threatening the local identity, as well as this war in Ukraine. So these, so AFD, okay, AFD, which opposes immigration and which opposes this war in Ukraine, they've seen a surge. in popularity.

Okay? And honestly, if there were fair elections in Germany, at one point the AFD is going to win. Okay? So what this means is that the Germans are choosing instead to fight a war. Okay? So in 2016, you can see the German military expenditure

wasn't that great, but now they're going to invent That's a lot more in the military. Why? Because the plan is by 2029 for the Germans troops in Ukraine. Europe is moving towards total war, structuring the entire society for war against Russia. Everyone says that Russia is now under a lot of economic pressure.

And it's true that the Russians have, in fact, spend a great deal more money on the military, okay? So you can see how after the war started, you have this huge bump in military spending in the rest of the Federation. But the thing to keep in mind is that it's still pretty low as part of its GDP, okay? So the green is Saudi Arabia.

So Saudi Arabia spends over 10% of its GDP on the military. The Chinese spend about 2% to 3%. The United States spends 5% to 4%. The Russians spend about the same, okay? So in other words, the Russians still a long way to go. In fact, Putin still maintains that the war in Ukraine

is a special military operation. It's not a full-scale war. If the moment that Putin declares war, the entire economy shifts to total war. We can expect a complete surge in spending on the military, okay? Russian hasn't reached that point yet. Now, what is Russia's planned for Europe? Putin doesn't actually want to fight Europe because it would be disastrous for both Russia and for Europe. But he understands that there's a civil war brewing in Europe where these right-wing parties like the AFD they're surging in

in popularity because they oppose war and because they oppose immigrants. So all Putin has to do is force Germany into a war and drag this war out, create a war of attrition. Why? Because as this war drags on, it's going to create a lot of political tension back at home, especially if you're drafting young men to fight this war. And if that would happen, eventually, right-wing political party would come into power. And how does Putin know this? Because this has historically been true.

This is what happened in Russia during World War I. When the Bolshev came to power, it almost happened in Germany. When communist almost came to power in Germany. So war creates political tensions. And the long of the war drags on, the more, the greater the tension. more the greater the tension is. Okay. So basically what Putin wants to do is create a civil war in Europe, allow these right-wing pro-Russia parties to come into power, and then form an alliance between Europe, Germany, and Russia. Okay? So part one of the plan is to create

as much political tension in Southeast Asia as possible by using North Korea. Part two of this plan is go to war of Europe in order to destabilize your politically and allow these right-wing parties to come to power and then form an alliance with them. Okay. All right. Now let's go on to the global self. Okay. So the thing about the global self is that Russia has been very supportive of the global South, especially countries in Africa. Okay? After the war started, when Russia invaded Ukraine, support for Putin in the global south increased dramatically, as this map tells you, okay?

Now the question is, wait a minute here. Russia invaded Ukraine, so why would people around the world support Russia and the answer is because of narrative okay from a Western perspective Ukraine is this innocent country and Russia is the aggressor so clearly Russia isn't wrong but if you are not part of the West if you're part the South what you will appreciate is that the West is this imperial bully and Russia is standing up for itself okay NATO was expanding too far, Ukraine was being co-opted by the West, and so Russia was trying to defend itself.

And thank God that Putin and Russia now can set up against the Americans, okay? Because we in the South have been bullied by the Americans all this time. So the support for the Russians are particularly high in Africa, which has been subject to Western imperialism for the past 20 years. So this is a level of cooperation between Russia and African countries. As you can see, there is a lot of trade going on, but at the same time there's also military cooperation. There's nuclear power plant construction. There's also oil exploration and nickel production.

Also, there are a lot of Russian mercenaries in Africa. and they're usually fighting against U.S.-backed groups in order to control the continent. China is also heavily active in Africa. The thing about China is that it's very much focused on economic development as opposed to military intervention. The Russians use a full-spectrum strategy in Africa, so they're trying to win hearts and minds. We know that because the Russians spent a lot of effort on propaganda, okay? So the Russian flag is where they have propaganda efforts. And as you can see, China is not that heavily invested in propaganda in Africa.

So what Putin is also not trying to do is create a narrative that Russia is liberating the world from Western imperialism. And this has particular strength in places like Africa, which has been a victim of Western imperialism for a long, long time. Okay? All right. India. Okay? So India, for the longest time, has been neutral.

So what's been happening is that India and Russia have become very, very close. The impetus for their close relationship is, after the war, In Ukraine, Russian oil became sanctioned. So the way to evade sanctions was for Russia sells oil to India, which would then sell its oil around the world. So what we'll see is a very strong relationship between Russia and India developed over the next few years. What Russia wants from India are laborers.

Why? Because of this war, Russia is now short of manpower. So it needs people to run its factories. Eventually, it's going to win this war in Ukraine and it's going to need people to go build, rebuild Ukraine, okay? So we can expect that Russia, India will become very, very close these past, these next 10 to 20 years, primarily because Russia wants to invest in relationship between Russia and India.

Iran is the key to Russia creating a new war. world order. Why? Because first of all, as you can see, Iran is really the center of global trade. So if Russia wants to access Africa, it wants to access India, it wants to access Central Asia, Iran is very important strategically. Okay? It's also very easy for Russia to trade with Iran because of the Caspian Sea. Okay? All right. So basically, Russia understands that Iran is the key to global trade, Russia's global trade with the world. And that's why the Americans are actually attacking Iran, because by attacking Iran, the Americans can block Russia from global trade or at least destabilize it, okay?

That's why one of the major battlefronts, this is actually probably one of the two major battlefronts in World War III. The first is, obviously Ukraine, which will be fought between Europe and Russia, second major battlefront will be in Iran fought between Iran and the United States. This is also why, by the way,

Israel is so important, okay? Israel. Israel. Why is Israel so important? Because Israel is the fortress, okay, the American fortress in this area. It's very possible that if put in place these cards right, all these regions will fall into the Russian sphere of influence. So America's guarantee against Russian influence is Israel. That's why the Americans support Israel so much. Because Israel is key to check it to keeping Russia in check. Okay? Does that make sense, guys? All right. The last thing I'll talk about is Japan. Okay? So the greatest strategy of

Americans is to use Japan to balance China. The Japanese don't like this idea, okay? Because For the longest time, the Japanese were a vassal to the Americans. And the Japanese made a lot of sacrifices to be the vassal state to America. But now you've created a situation where Japan has no choice but to re-militarize and rethink its national priorities. The war in Iran is forcing Japan to rethink the global map, okay? So Japan is heavily dependent on energy imports. And for most of its history, most of its recent history,

it was getting its energy from the Middle East, okay? But obviously, most of this energy is now gone. So now you have two options. You can either depend on Russia or the United States. Now you would think, well, Japan will just buy a large oil from the United States. The United States certainly thinks so. But the last time this happened was before World War II. Japan, before War II, was getting 90% of its oil from the United States.

But Japan was becoming too powerful, and so the United States started to embargo Japan. And then Japan had no choice, but then to go invade Southeast Asia for its oil and attack the United States. Does that make sense? So Japan does not want to put in a situation where it's completely dependent on Americans for oil. because the last time this happened, it didn't really work out well for Japan. Okay? So Japan has no choice in this matter, but to, yes, by American LNG, but also to try to smooth things all over Russia, to start buying more oil from Russia. Okay? The other problem for the Japanese is that for the longest time, they've been buying US treasuries, okay?

So you can see how China China, yes, China's addicted to US dollar, but they recognize that the Americans aren't that dependable. They're putting too much money, they're too much in debt. So the Chinese have been selling US dollars, US treasuries, but the Japanese have been increasing buying US treasuries. Why is that? Why is it that US treasuries aren't worth as much money as before, but the Japanese continue to buy U.S. treasuries.

And the answer is because it's almost like a subsidy or a bribe to the Americans, okay? Right? Because the Americans have a lot of soldiers in Japan. So Japan is a colony. And so what you do is you bribe the Americans to protect you, but also to just leave you alone, okay? alone, okay? And the way they do do this is something called the Yan

carry trade, okay? And this is a citizen thing ever, okay? But let me explain to you, let me explain to you what this is, okay? So what the Yan carry trade is this. Japanese banks will lend money to Japanese corporations at zero percent, okay? Basically free money. So if you're a big Japanese corporation and you want you need money, you just go to the Japanese Japanese bank and they'll give you money at 0% interest. What this means is you can take this money and then go buy US treasuries. U.S. Treasuries at 5%.

It doesn't make sense. And so that's what's led to the surge of Japanese buying of U.S. treasuries. It's free money. It's literally free money. But the problem is that, as you can imagine, this is causing huge problems for the Japanese economy. Japanese economy. Okay, and as a political situation gets worse and worse, Japan has no choice but to repatriate its money back from the United States, basically selling US

treasuries. Okay? So what America needs to do is basically force these countries like Japan, China, to continually buy US treasuries. And that's why we have this war in Iran, okay, to really control the world's energy supply. And time is running out for America, okay? The reason why is that as more more people sell US dollars, as more as more people refuse to buy US treasuries, certain problems arise, okay? First is the debt interest. So right now, the debt is at $39 trillion. Let's assume the interest is 5%. That means, means that the Americans have to pay $2,000 in interest payment alone.

Does that make sense? Okay, that's a huge problem. Second problem is that as people refuse to buy U.S. Treasuries, you need to give them a higher interest rate, okay? So right now, 5% and it has moved up to 6%. This is a disaster for America. America. Okay? So America needs to basically act now. Okay? It needs to move down the treasury rate. Okay, the way you move down the treasury rate is by forcing people to buy US treasuries from you.

Okay, so this is a war that's going on between Russian and America, between Putin and Trump, where Putin is trying to get people to, to not buy your treasuries and Trump is trying to force people to buy US treasuries okay and this is a war that's being fought right now okay any questions about what's going on okay how will America become or how will America end if like the world and America is so addicted to US dollars wait wait can you ask a question again how will America and war or like how will America be if the world and America are still addictive to US dollars? Because it is an addiction, okay? It's free and easy money.

Yeah, but like what will America become like if this trend continues? If this trend continues? With this addiction? Yeah. Okay, all right. So, right now, if these trends continue okay there's certain problems that arise okay the first thing is that America will print more money okay so the debt financial dollars will continue to increase and then the world's gonna think you can't actually pay this off right so then what happens is that people stop buying US treasuries then the interest rate in order to get people to buy more US treasuries. Because if you don't do that,

if people don't buy US treasuries, you go into default. Okay. So what does default mean? Okay, well, let me explain how the system works. Okay, first of all, it's a federal reserve that lands money to the US government. Okay, so there are different buyers

of U.S. Treasuries, but the Federal Reserve is the biggest buyer. All right. So let's just say you owe what China has a trillion dollars in U.S. Treasuries and the United States says to China, you know what, we're not going to pay you back. Screw you guys. Okay, doesn't matter? That doesn't matter. Who cares? Okay, the federal reserve is a different problem. Why? Because let's say you owe the Federal Reserve 10 trillion dollars. Okay, where does this money come from? It comes from, it comes from, private banks okay and who puts their money in the banks the people put their money in the banks all right so in other words the American government has borrowed its

money from the American people so if the American government were they thought on its debt American people would lose all the money in the bank and what would you and what would that happen and so what would happen after that a revolution would happen okay in other words it is impossible for the US government to default on this debt. It would create a revolution in America, the government would collapse. Does that make sense?

Okay? So now you just forced to get China to buy $2,000 dollars. You understand? Because you can't force the... Because you cannot default the debt domestically because everyone would because everyone in America will lose all their money.

Okay? So, the only thing you can do is go overseas and force people to buy U.S. dollars from you. And you do that for war. All right, does that make sense? Okay? So Putin understands that all he has to do is stop foreign countries from buying U.S. dollars

and America will collapse in itself. Because the economic doesn't make any more sense. It's impossible for you to pay all that interest payment. So that's a stark crisis that America's facing right now. Any more questions? Yeah, Alan. So I'm curious about, like, even if Russia really collapses systems of current global economies, like, what will be the new position of Russia's?

Like, what is the precious commodity of Russia's that can maybe give it the power to maybe lead the world? Okay. So we're assuming that anyone, someone wants to be the new leader. And the reality is that it's actually stupid to be the world reserve currency. It's silly to be the world leader because now you're just forced to spend all your resources on defending your position in the world, okay? It's like being a high school bully. Well, being a high school bully sounds cool, but now you have to go fight everyone in the school. Okay? So no one actually wants to. to be the world leader. In America doesn't even want to be the world leader. It's just stuck being the world leader because of these historical accidents. It doesn't make sense. So basically all Russia is trying to do is it's trying to get rid of the school bully. Once you get rid of the school bully, there's no more bullies, okay? Which means I can do whatever I want now. More freedom for Russia. Now, doesn't mean that Russia will be peaceful. Russia is going to go, it's going to exert its power where it can, but it will have more freedom of movement.

It sees America as a great threat, and so Russia wants to get rid of America. China's different. China appreciates that historically, its neighbors have been very aggressive, okay? Who are China's neighbors? The Japanese, right? The Russians, the Vietnamese. They're very aggressive people. So if I'm China, I would prefer America to be the global policeman, to be a high school bully.

Right? Because honestly, if America's not the high school bully, someone else is going to be a bully. And I much rather deal with America than with Russia. Okay, so that's why the relationship between Russia and China is much more tenuous, much more unstable than people believe it is. It is in the mutual benefit of the two to get along right now. now, but in a long term, there's eventually going to be a divorce because their interests don't actually converge to together. So Putin's plan is just to be making good friends with China.

He knows that China in a long term is going to start more of America than with Russia, but in a short term, Putin can do as much as he can to make China his friend. Okay? So he needs China to be neutral. The worst thing that would happen is that China sees Russia as a threat and China and United States got together to defend the system. Okay. Doesn't make sense? Yeah. Okay. A further question is like does the collapse of economic systems will affect the global police positions of America?

Because I think we previously said that this global economy system basically built on the Americans, military powers, but even though the systems collapse financially, it doesn't mean that the military power of American decrease, then why then the Russia will get its like freedoms to move then? Okay, look, the reality is that your military comes from your nation state, okay? Your military comes from your nation state. Why? Because it's your nation state that provides the weapons, the manufacture of the weapons, the people, the soldiers, the financing. Okay? So let's just say this nation state is a revolution, where the people are fighting a war against the government. The military has no choice but to retreat and try to crush this revolution.

Okay, does that make sense? So remember doesn't have the interest in defending a world if its entire nation is falling apart. That's just silly. It has to retreat, okay? Okay, and it's possible that America is so stupid that its military stays overseas. But if that would happen, then the military would still need a nation state, okay? And so it needs now to move from America to different nation states. And I imagine that if that was the case,

the military would split off and inform, help support three other nation states, which are Japan, Germany, and Israel. In other words, different theaters on the American military would find a different nation-state as their host. Okay? So the American forces in East Asia would go and support Japan. In Europe, they go support Germany. In the Middle East, they go support Israel. All right?

But they need a nation state as their host. Okay? Clear? All right. So next week is the final examination. So if you're on YouTube, you're watching YouTube, please post your questions in the comment section, and my wife, my beautiful wife, will select the very best.

Okay, all right, see you guys next week.