An apocalypse upon us: how much more can one summer take?

Some months are best recorded as a list, because the point is not any one item but the number of them. July 2022 was such a month, and this is the list as it was made at the time, with the commentary that went with it.

The list

A trade war that had never ended. Stock markets in their worst first half since 1970. A bond rout unprecedented in the data. Recessions declared or expected in Britain, the euro area and, on the evidence of the first quarter, the United States. Corporate earnings guidance falling and the first rounds of firings in technology. An energy crisis in Europe as Russian gas was throttled and prices went to levels that closed fertiliser plants and smelters. Cryptocurrencies down by two thirds from their peak, with lenders and exchanges failing weekly. Housing markets turning as mortgage rates doubled. Covid still circulating, monkeypox newly declared an emergency, quarantines still in force in China. Inflation at its highest in forty years in most of the West. Shortages of everything from baby formula to diesel. A hot war in Europe with a nuclear power, and sanctions that hurt both sides. Record heat, drought across three continents, and grid warnings in Texas and Germany.

What was being done about it

The policy response, as it was described here, was to raise interest rates rapidly and shrink the money supply into a recession, and then, on the advice of a former Treasury secretary, to consider tax increases to punish demand. On the other hand, a new emergency was being prepared for the new virus. The record does not require agreeing with the sarcasm to see the pattern: each response to the previous crisis was arriving in time to compound the next one.

Two further items on the original list belonged to the culture rather than the economy, and one of them is not reproduced here. The other, the observation that large institutional buyers were purchasing houses with all-cash bids no household could match, and that the largest private owner of American farmland was a software billionaire, was an economic point and it stands: ownership of the basic assets was concentrating at exactly the moment the cost of borrowing to buy them was rising for everyone else. A clip circulating that week of a World Economic Forum promotion, “you will own nothing and be happy”, was received as a threat rather than a forecast, and a well-known agenda is not a conspiracy theory even when it is presented as one.

The rest of the world

China was adding its own list. The zero-Covid policy was locking residents in apartment blocks and closing ports; the property developers that had financed a decade of growth were defaulting in sequence; the banks that had lent to them were freezing withdrawals in Henan; and the government was threatening Taiwan and had finished dismantling Hong Kong’s market freedoms. Russia, China and their partners were talking about a trade currency to rival the dollar, which, if it were tried in a year when every currency was already under strain, would spread the strain rather than relieve it, just as central banks were preparing their own digital currencies to replace what was left.

And then the food. Tens of millions of chickens culled against avian flu. A run of fires at food-processing plants that may have been coincidence and was noticed anyway. A Dutch government policy to cut nitrogen emissions that would force a large share of the country’s farmers, in the world’s second-largest agricultural exporter, out of business.

The question

With this much going wrong on its own, the question asked here was what to make of leaders who seemed determined to add to it: closures, mandates, and a habit of dividing the population from the top, which in the United States was true of both the previous president and the current one. The answer offered was that the outcome would be the same whether the piling-on was intended or merely incompetent, and that the difference mattered less than people wanted it to.

That is where the list ended, with a promise to set out where the rest of the year and 2023 would go. The following pages in this section are that attempt.

Later note. The American recession the list anticipated did not arrive in the form expected; inflation peaked the month before this was written and fell through 2023; the energy crisis in Europe passed without the blackouts feared, at the cost of the industries that closed. The crypto collapse continued to FTX in November. Most of the list resolved less badly than it read, which is the usual fate of lists, and the ones that did not, the war, the housing affordability gap and the concentration of ownership, are still open.