20/01/2015

Stop the World - I Want to Get Off

The announcement by the Swiss National Bank (SNB) that the Swiss Franc will no longer be pegged to the Euro sent shockwaves throughout Switzerland. One of the harshest criticisms was that the decision was taken by the Bank alone and that the general public was unprepared for the change. Instead of the Bank being praised for denying speculation, it was lambasted for the surprise.


The 1961 stage musical “Stop the World – I Want to Get Off” traced the life of someone from birth to death who each time something negative happened in his life stopped the show to address the audience. Assassinations in Paris, Boko Haram murders in Nigeria, Islamic State advances, civil war in Syria with millions vulnerable, Russia threatening to cut off energy supplies to Europe, glaciers melting, Ebola, etc. Do you want to scream “Stop the World – I Want to Get Off”?
The year has gotten off to a difficult start. Should we be surprised? With news traveling at an increasingly rapid pace, we are more than aware of what is going on around the world. We are 24/7, unlike the past. Try to imagine what it was like living (surviving?) during two world wars. Try to imagine growing up during the Spanish Influenza from 1918 to 1920 that infected an estimated 500 million people, killing 50-100 million, 3%-5% of the world’s population at the time.
This is not to denigrate the horrors of what we are living through right now. We empathize with victims of the shootings in France. We acknowledge the outpouring of support for free speech while recognizing the necessity of respecting differences in sacred symbols. We try to put ourselves in the place of those fleeing Syria and Iraq. We try to understand the desperation of those trying to cross the Mediterranean Sea. We witness the glaciers melting and applaud efforts to reduce carbon emissions.
While we have better access to news, we also have greater expectations that we can find solutions to these problems. We are overwhelmed with news of disasters but continue to be optimistic that the problems can be solved. After all, the number of people dying from AIDS has been reduced; the fear of uncontrollable viruses flying in from China has evaporated; the Berlin Wall did fall down; the Arab Spring did happen; overall life expectancy has increased; global poverty has been reduced; slavery has been legally abolished.
How to keep all of this in perspective? Almost all discussions of geopolitics miss the element of time. Business people talk of product cycles. News people talk of headline cycles. Some political scientists talk of long cycles. In an era of accelerated time these cycles have become shorter and shorter. Today’s top selling product may be gone tomorrow. Twenty-four hour news cycles have become the last 15 seconds on the Reuters screen. Radical political changes abound. We have trouble keeping up with the latest, having perspective on what it all means is terribly challenging.
Are there patterns to all of this? Is there a DNA of geopolitics that we are missing? The search for patterns is part of our desire to understand. Chaos theory is in itself an attempt to identify and label what is going on around us.
How to keep all of this in perspective? Almost all discussions of geopolitics miss the element of time. Business people talk of product cycles. News people talk of headline cycles. Some political scientists talk of long cycles. In an era of accelerated time these cycles have become shorter and shorter. Today’s top selling product may be gone tomorrow. Twenty-four hour news cycles have become the last 15 seconds on the Reuters screen. Radical political changes abound. We have trouble keeping up with the latest, having perspective on what it all means is terribly challenging.
Are there patterns to all of this? Is there a DNA of geopolitics that we are missing? The search for patterns is part of our desire to understand. Chaos theory is in itself an attempt to identify and label what is going on around us.
The one constant we are witnessing is change. Those in Switzerland who thought they were safe with their Euros have been rudely awakened. But, the 1:20 baseline was only started in 2011. In other words, the very security that has disappeared was situated in time. Before 2011, there were no guarantees, just as those living behind the Iron Curtain in the 1950s had no idea that the Wall would one day come down. Risk management has become a growth industry; people get paid to make predictions about the future.
We all make predictions about the future. That is why we take out life insurance policies or why we save for rainy days; we have health insurance. We make rational choices about what we think will happen. We anticipate the future; we think we know what change will come about. Our choices anticipate change in a way that we can anticipate. We will get older, therefore…We even make wills for our descendants.
Most change, however, is not anticipated. We could say that the continued buying of Euros by the Swiss National Bank could not go on forever. We could say that the radicalization of jihadists took place over a period of time. Hindsight is a wonderful quality. We do not always see the forest for the trees. We are overwhelmed by the day-to-day. We have less and less time to ponder a larger perspective.
Change is a constant. Those who cry “Stop the World – I Want to Get Off” are really saying that they want to stay in a situation of perceived security. They want the inevitable change, when it happens, to be positive. We can only hope that the future will bring positive surprises. For surprises, positive or negative, there will be. They are part of change. The SNB’s decision was perfectly rational. Most of us just don’t like surprises.

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