Peter Zeihan: The Demographic Time Bomb That Will Reshape the World

26:00So we could either see that network merge with North America or go its own way. Both of those are viable options. But if you're not in one of those clusters, you've got to figure out if you can A, induce one of those clusters to include you, or B, if you have any hope of striking out on your own. And the only country that I can see right now that might be able to strike out on its own is Argentina because it's got the population structure, the food production, the energy production, the mineral production. Talk about a story that's always been potential and never gone anywhere is Argentina. Yeah, just keep in mind that in the world we're moving into where transport's more difficult and finance is hard to come by and rule of law breaks down, you know, the Argentines just call that an average Tuesday.

26:44They know how to work in that world. So even if they don't find a way to turn the page domestically. It's not so much that the world has to rise to Argentina, it's the world will fall to Argentina. So do we end up with more kind of kinetic engagement between nations, or is it trade warfare between these regions that concerns you the most, or is it a combination of? In the short term, definitely trade warfare. One of the problems you have when you face demographic collapse is that you can no longer consume what you produce. That is certainly the situation the Chinese and the Germans are in today.

27:20Both of those countries have about the same number of people over age 50 as under. And so product dumping is the only way to work. The Germans were product dumping on the rest of Europe. Now Europe is catching up to them in terms of age. So they have to go outside the block. And countries that still have a robust demography are also interested in re-industrializing themselves. The U.S. is at the top of that list. And so it's not getting a very great reception. And the French will prevent the European Union from having any meaningful trade deal with anyone to grant market access to somebody like Germany.

27:52In the case of China, it's product dumping left, right, and center. And that's why pretty much every country in the world, including the Russians now, are basically blocking Chinese cars from access to the markets. The one exception is the one European country that doesn't have a car industry, Britain, which is kind of hilarious when you think about it. So the product dumping, does that not end up being a disinflationary world? As long as it's allowed to happen, yes. But if it gets locked up in its home country because no one will take it, then it's a deflationary for them, and that's a real problem.

28:28And we're already seeing significant deflation in products in China. Yeah, I mean, China's problem is deflation because debt and old populations tend to lead to deflation. And that means the real burden of debt keeps going up, and it drives itself in this pretty doom loop that goes on. And Europe's been in that for a long time. Yeah, China, but they've been able to export until now. So it's only now really digging into Europe. In the case of China, they probably need to destroy somewhere between one third and one half of their industrial capacity to take care of the deflation issue. That's a system-ending event.

29:03And does the US election affect this or accelerate it in terms of the tariff movements and stuff like that, the decoupling from Europe, China? How is that going to affect it if that happens? Well, the cop-out answer is I have no idea. Harris has never been in an executive position before, so whatever she says, there's no trap for us to evaluate. We just don't know. And Trump, if you've seen his last 2025 public appearances and speeches, has clearly lost his mind. The dementia is full-blown, and he will not be president if he's elected. It'll be Vance, who, like Harris, has never been in an executive role ever.

29:46So you don't think that Trump survives the term if he gets to the president? Oh, God, no. I mean, Biden certainly wouldn't. Trump's like an hour and a half younger. Why in the world would we think that Trump would? Yeah, no. I mean, mentally, he's calling. So we have no data points to draw from whatsoever. You can look at what the previous administrations have done and maybe add a little bit of guidance. Team Trump was very pro-tariffs, but then never used the income from the tariffs to do anything constructive. So all that did was retard economic activity here. Or you can go with the Biden approach, which was to identify specific subsectors to really dig in and provide technological fences around them to block tech transfer, which may be more productive, but again, unless you provide some sort of incentive to build out the industrial on the other side is almost as pointless as what Team Trump was doing.

30:43So neither of these are great strategies in isolation. I mean, the problem we've had in the country is that we haven't really had an industrial policy since the 40s. And so with the exception of Joe Biden, there is no one alive today who has any memory of it. And we're new at it. And the idea that we're going to get it right within two or three years, I'm kind of like, yeah, right. But even with that, I look at things like the IRA, which as an economist, I'm like, oh my God, there's so much about this that is so wasteful and so stupid. But I was in favor of it anyway, because it's building industrial plant here now.

31:19And even if we build the wrong thing in the wrong place, we can always retool it. The important thing is that it's built as soon as possible because we have a limited window that the Chinese are still with us. And we need as much of that industrial plant as possible to help us build out ours. Now, that leads me into a big conversation I want to have with you, which is I've been observing the Gavin Newsom going to China was very interesting because that's not his job. And for Xi to meet him it meant that gavin used some yeah he was a non-political squeaky clean out of the box person no geopolitic background goes to china he should be meeting a regional leader he doesn't he meets she so he's clearly a messenger then he says hey she come back to my place she doesn't go to the united nations doesn't go to dc goes to california and then leaves and then there's a bunch of things happen about chi going to europe putin going there my general thesis is there's a lot of people worried about kinetic warfare with china over taiwan and i'm starting to believe the chinese and the americans have done a deal which is let us build the taiwan semi plants the three in arizona germany's building one and um japan's building one and you give it a grace period and split the technology?

32:50Well, let's start by saying no. The Chinese can't operate any semiconductor facility on their own that makes chips better than 90 nanometers. Yeah, but they would have Taiwan. They would have... Right, but they wouldn't know what to do with it. The tech transfer would be a meds. It's several generations beyond what they have the workforce to support. So the only way that that would work is that the United States established a military authority over Taiwan and physically forced all of the Taiwanese to share all their technology in a day-by-day basis for decades, as well as American design for continuing to provide all the inputs, logistical supply chains, and intermediate materials that allow these fabrications to work in the first place.

33:33It is the most complex supply chain humans have ever produced, and most of the single-point failures, of which there are thousands, are not in Taiwan. They're in Japan, Korea, Canada, the United States, Belgium, the Netherlands, Germany. So no, as we're discovering with the United States, as TSMC attempts to build a high end fab just in Arizona, it's not just the fab. There are hundreds of companies in Northern Taiwan that then take the chips and do the packaging, the testing and building them into intermediate products that ultimately end up in the manufacturing system. There's a whole ecosystem here, and the Chinese are not good at any of it.

34:14So no. As for Newsom, keep in mind that he's the governor of a state that has an economy that's roughly the same size as France or the UK. So the idea that he can have his own little quasi-foreign policy fits in perfectly. And also, if you think about what the California economic model the last 40 years has been, It's been de-industrialized, focused on services. You take the capital of the American system with the millennials of the American system to imagine the future in a place like Silicon Valley. And then you use your ports to take Chinese finished goods and distribute them to the United States, all the same time that Silicon Valley is helping build out the Chinese industrial plant.

34:57That model's over. The millennials are aging out. With the baby boomers two thirds retired, the capital is gone and the Chinese system is failing. So the idea that Xi and Newsom have things to talk about, oh yeah, because what they've basically been working on for the last generation is now stopping. And they're trying to see what they can salvage. It's reasonable. Okay, so this moves me on a bit to the answer to depopulation is that I say it is AI and robots. you're creating infinite humans in every form from infinite knowledge to infinite physical labor and it's happening fast and it feels to me that this is the solution that is on the table and the aging population and the falling population growth essentially drives the urgency of this faster and faster that we create a bunch of outcomes we don't even know AGI being one of them because the desperate need for workers.

35:57Well, let me give you three problems with that. I mean, number one, I would agree that automation in some form is going to stretch the worker and that's essential in the environment that we're in. But first things first, let's say we're wildly successful in all of this. Okay, maybe that solves the production side of the equation. It doesn't solve the consumption side. And the number of wealthy people aged 20 to 45, the people who consume everything in the world, that is a population that is now in permanent decline, and increasing production doesn't solve that issue at all. Second, I don't think it's going to happen with the speed that people are hoping.

36:36Remember when I said there's thousands of single-point failures? You lose any meaningful country out of the globalized coalition. I'm personally most worried about the Germans. And it's going to take us 10 to 15 years to rebuild that capacity in a more geopolitically demographically stable area, which means that these high-end chips that we've all set our hopes on, we're just not going to be able to produce very much of them at all. I'd actually argue that the most consequential outcome of this presidential election is whoever wins is going to be the one who's going to decide by fiat where these chips get applied.

37:09Do we use it to crack the genome so we save global agriculture from collapse, save a billion people from starving? Do we use it for worker productivity so that the manufacturing labor force could be stretched further? Do we use it in the capital markets so we get more efficient at applying what few investment dollars we have left? Or do we use it for national defense and cryptography? I mean, those are all good choices. We're probably only going to have enough chips to try one of them, much less all four. I mean, if we're going to do AI for real, we need different hardware. The chip that we use currently, it's called a GPU.

37:45It's about the size of a postage stamp. It's the heart of a gaming console. It's designed for graphics. That's what GPU is, graphic processing unit. It generates a lot of heat. And so within a gaming console, you've got a bunch of fans blowing on it. But it can do calculations in parallel, which makes it the best architecture of the existing chip network that we have. And so you take 10 ,000 of these and put them in one room, it generates a lot of heat. That's where the power demand comes from. But they're very, very limited for what they are and we're using them for. If you want a proper AI chip, it's not this big.

38:21It's about this big. It's a dinner plate, and it's got a cooling technology built into it, and it can handle billions of computations every second. They're designing those now. We are unlikely to have our first hard copy of it before the end of next year. And assuming that works, then it'll be another two years before we have our first production run in the fab. And assuming that works, it'll be another two to three years before we have enough to build our first server farm out of these things. So you're already talking 2029, 2030. Yeah, but we are building out 100 ,000 server plants already. With the PEUs, which is the one with the highly volatile, vulnerable supply chain.

39:06Yes, but they're already in place. I mean, Tesla's built its 100 ,000. So we'll be able to use the ones we have. But the idea that we can overhaul the entire economy on just a few server farms, I don't think so. It'll be useful for the people who can access them. Yeah, and that is, it's clear that it's the tech giants in the US that have the access. They're putting the most money behind it, absolutely. Yeah, and they've already built something. I mean, it was an extraordinary conversation with Larry Ellison, just talking about him and Elon begging Jensen for chips. It's just like, we just need all the GPOs you can produce.

39:48We'll pay you anything for them. These conversations only started a year ago. So if every chip manufacturer that was capable of making the GPOs switched entirely to their production at the time that conversation happened, we won't have enough to build our first server farm for another year it takes two years to do the retooling and then the fabrication so from you from every angle there seems no optimism give me the optimistic case we're not looking at civilizational collapse here yeah and my view is actually the opposite but even though i agree with all of your major points about the deglobalization and the population collapse, I'm more optimistic about the role of technology in a short enough time period, not today, not this year, not next year, but by 2030, that we have a lot of this kicking in.

40:43And in the interim, we just use the global money printer to paper over the cracks in the system and hope that holds together without something major going wrong. So I actually think the outcome is more positive. But give me a positive take from you. And again, we can talk of time horizons because we're both talking very various time horizons from immediate, interim, long term. So I don't mind different views on different time horizons. Sure. So we need to expand the industrial plant here in the United States, well, in NAFTA, by about double. That's not just a growth story. That's the fastest growth story we've ever experience in Mexico, in the United States, in Canada.

41:25It's going to last for several years, and it's going to build a supply chain system that is immune to a lot of international shocks. I mean, it's a really good story. We just have to do it as quickly as possible in an environment of constrained capital, constrained labor, which means it's an inflationary story. But what do we build and how does it use humans? Because you look at the new Tesla factories, they're just all robots. Exactly. It's going to look different. It's not your 1950s factory anymore. It's all going to look different, especially the stuff that left 30 and 40 years ago. And remember, we don't have to do this by ourselves.

41:57Mexico is right there. Colombia, we already have a free trade deal with. We're going to find new ways to put things together. I have no doubt about that. My concern is that we have to do it with the technology we have now. Because if we're talking about things like AI that aren't going to really manifest for a few years, in a few years, we need to be mostly done with the industrial build-out. So we may be able to retool this on the other side of things, and that's great, and I welcome that. But we can't wait for those tools to become available, because China's on a very limited timeframe. So what are we going to build?

42:32It can't be Amazon warehouses, and there's like... That's distribution. We still need that, yes. I expect Amazon warehouses will probably also become impromptu manufacturing centers. Things like 3D printing are really well set up for that. We need to roughly increase the power grid by half because moving stuff, stamping stuff, welding stuff takes more electricity than even a data center. We're going to see electronics probably be the biggest sticking point because that's a technology that today requires fingers and eyes. And that's going to be hard to do because we just don't have the labor force here.

43:07Mexico, it's going to have to be Central Mexico. because northern Mexico, the labor's already gobbled up in more value-added industries. And then automation, of course, is something we'll plug into that. Courtesy of NAFTA II, I'd say we're already 90 % along the way of where we need to be with something like automotive and heavy machinery. So, you know, that's largely done. But electronics manufacturing, I think that's going to be the sticking point moving forward. Textiles is coming back pretty robustly, and that's all automated now. So, you know, these are all good stories. but it's not a straight line.

43:43I worry less about the US for many of those reasons and because it does lean into technology. I'm more worried about Europe because it's actively rejecting technology. The only technology it's adopting at scale is renewable energy, which is great because over time it lowers the cost of electricity. If you're in a place that's sunny or windy, which most of Europe isn't. But the overall issue is, what is the future for Europe? That's what I struggle with. And it's not cataclysmic. It's just a bit miserable. There's four futures. I mean, keep in mind, as soon as the Europeans realize that the Germans are going to be a net beneficiary instead of a net giver to EU funds.

44:26When do you think that happens? What time horizon? Within six years. Right, yeah. Yeah. So the EU in its current form is at the end. That doesn't mean there can't be some sort of European association in the future. I think there will. But economically, there's four different stories. You've got the UK, which once it figures out that really its only option is merger with NAFTA, it'll have to suck it up and give much more to the United States, Canada, Mexico than it ever gave to the European Union. But it's the only way to get on the right side of a tariff wall with the customers that can allow it to maintain its economic model.

45:00It's the only game in town. Second is France and whoever countries it chooses to bring into its immediate orbit, which will probably include Spain, Portugal, Belgium, and Italy, maybe an association with the Netherlands, although I think the Dutch are much more likely to jump ship with the Brits. And that's a Paris-centered thing. Third, Central Europe. Their demographics are aging very, very rapidly, in many ways even faster than Western Europe, but from such a younger base that they still have another 30 to 40 years to go. And you partner them with Scandinavia, which has the most stable demographics outside of France.

45:38That's an association that has a lot in common, not just culturally, but strategically. And they're all concerned about Russia being public enemy number one. That just leaves Germany, which is hosed. The German demographic is awful. Their industry was designed for a different world. They're having an energy crisis, which is shutting down their entire chemical sector, which is now feeding through their manufacturing system. I don't see how that works unless someone pays them to exist. Germany is the new Greece. So that's a nice statement. How does Europe fund itself without Germany? They have a very, very different sort of association, less based on economics and more based on politics and military factors.

46:25Basically, the European equivalent of a NATO that's run by the French. And do you think they're going to do that? I think that's the only option. Whether they do it is entirely up to them. And where does Russia fit into all of this? Its demographics are truly fucking atrocious. Yeah. They've been kind of sidelined in the system. They play this role of antagonist within the system. Where do they fit into all of this in the end? Is this all down to Putin? Or if Putin changes, does it change? I mean, how do you see Russia in this system? The whole logic of the Ukraine war is that the Russians are trying to reach a more defensible external perimeter, something much more similar to what they had in the Soviet period.

47:09Right now, they've got about 4 ,000 miles of open terrain on the borders. if they can get to the Vistola and the Danube and the Baltic, they shrink that 4 ,000 to about 500 miles. And that's a lot more manageable for a country with a falling population. So it's not that Ukraine was always going to happen. It was. Ukraine was never the end of the story. So if the Russians do succeed in Ukraine, they will be coming for Romania and Poland and Estonia-Lapia and Lithuania. And we will get a straight-up fight between either NATO and Russia, if NATO is still around, or the Scandinavian Central European bloc and Russia, one way or the other.

47:48But how did Russia afford this? Efficiency and economic activity had never been things they'd overly cared about. But they've not done particularly well with warfare in the Ukraine. They have not done particularly well, but the balance of forces is still firmly on their side in numbers, in industrial plant, in weapons. and they now have the Iranians, the Chinese, and the North Koreans basically belling up to the bar to help out. And at this moment, the West has not reacted to that reality. Now, let's look for the potential of the flip side happening in Russia. What would change that situation?

48:28If Putin goes, does Russia change? No. Or does it just have another power vacuum and it creates the same stuff? Putin has so purged the system of anyone who's not in his circle that everybody basically sees the world through the same lens. So we might have some differences on the margin, but I don't think a new leader in Russia would make a difference. What would theoretically make a difference is if Russian forces suffered a catastrophic public humiliating defeat like they did in the Crimean War, like they did in World War I. That would trigger a political revolution, which would tear the system down.

49:03And then that's the end of unified Russia. But at the moment, that hasn't happened. That could happen in Crimea. It could happen in Kursk. It could happen in Belkara. There are a lot of candidates. But at the moment, this is from a front-line point of view, this has been a very stagnant fight the last couple of years. The tactics keep changing, the weapons keep changing, but the lines on the map haven't moved very much, and it makes it easier for the Russian government to spin this as something that is still showing progress. let's try and kick about the positive view on china how does it resolve this mess of excess capacity huge debts aging population and a reordering of global trade of which maybe it doesn't get the free reign to export everything everywhere at no cost we understand the downside which is the collapse of China.

50:00But how do they get out of this? What is the flip side of the equation that could go right? Well, as you said, the core issue here is an imbalance between supply and demand. So either you double supply or you have, I'm sorry, either you double demand or you have supply. Doubling demand would require Star Wars style cloning where you grow fully grown adults complete with skills in a short period of time. I am unaware of any breakthroughs in that technology. and then the other one is destroying half the industrial plant, but now you've destroyed over a third, probably closer to two-thirds of jobs.

50:35And if there's one thing that the Chinese system won't do, it's generate a lot of unemployed because when unemployed got antsy the last time around, they formed the Chinese Communist Party and went on a long walk and tore down the government. So I don't see how this is fixable without a significant change in the structure of the system. And the CCP has a vested interest in not changing the structure of the system. So, okay, let's move on to Japan and Australia, two other places we haven't talked much about. How are they going to fit into this equation? Where's the kind of downside and upside with these two as well?

51:12Well, they're pretty bullish on both of those, at least in the midterm, next 10, 20 years. Australia is probably going to replicate its success of the last 30 years just working with Southeast Asia rather than China. They're not as debt-driven. It's a much healthier growth profile and honestly has a lot longer to run because the demographics are better. So it might not be the breakneck growth they've seen since the 80s, but it's still going to be a really good story. This probably needs to be an adjustment, but here and there, we probably do need to have that recession. And oh my God, their housing market's a nightmare.

51:44And the sooner that is adjusted, the better. but that is going to knock easily 10 % off of the headline GDP when it happens, and that'll be rough. But on the other side of this, it's a pretty good story. Japan is unique. They're the original story of demographic decay, but unlike everyone else who's been ignoring it, they've been working on it in bits and pieces since the 80s. So they found ways to keep people in the workforce longer. They found ways to encourage younger families to have children. And so while they're still old and they're still aging. They're no longer the fastest aging society in the world.

52:20There's 15 countries that are aging faster, ranging from Spain to Germany to Italy to Belgium to Thailand to Taiwan, China, of course, and Korea. So other countries are going to get to demographic dissolution due to old age before they do. In addition, they've also altered their economic structure in a way they don't think China can. They've offshored most of their industrial production to third countries that have healthier demographic stories. So in many ways, that is part of the story of the renaissance of the American South, where country companies like Toyota have basically gone into places like Kentucky and North Carolina and built massive production facilities in order to get on the right side of the tariff threat.

53:01They've not just done that in the United States. They've done that in Mexico. They've done that in Southeast Asia, and it's working pretty well. So you do the design and specific component manufacture in Japan, but most of the work is done somewhere else. So if we see all of these struggles, these global struggles, and there seems to be very few options as this thing either accelerates downwards or glides in that path, how does politics change in this? Well, think of it this way. We're on the verge of every economic model we have ever designed as a species no longer working. Basically, fascism, communism, socialism, capitalism, they're all about distribution of goods and the balance between supply and demand and labor and capital.

53:50They all differ on how it should be done, but that's the core format. The demographic decline means demand goes away and capital goes away. We need to admit something new and to think that countries can come up with new economic models and it doesn't change their political system is silly. And if you look at how we designed those four systems we use right now over the course of the last couple of centuries, every time there was a new one was introduced, especially in a place that has some geopolitical pressure, like say Germany, you know, shit got really real, really fast. So I don't know how that will play out because we haven't invented the model yet.

54:34But if you're in Southeast Asia or North America or Argentina, where the demographic picture is better and you can still use the old models to underpin some very strong growth, this isn't your problem yet. We're going to be able to look at the Germanys of the world, the Koreas of the world, maybe the Chinas of the world, and see what they do and hopefully learn a few things, even if it's just from their mistakes. Yeah, I mean, again, my view is that thing has been invented. It's called AI, and it's the most powerful technology humanity has ever created. And it'll be the fastest adoption of every technology we've ever seen.

55:14If we can build the hardware. Because of the economic importance of this. There's tens of thousands of industrial steps that are required to make that specific subsector work, and we're going to lose a lot of them. We will rebuild them, but it'll take 15 years. Yeah, I'm more optimistic. And I think by 2030, we start to see the fruits of this coming through. I'm also pretty encouraged on renewable energy and the overall lowering of electricity costs. The renewable story is the second most complex manufacturing supply chain we have ever had. So, you know, from your lips to God's ears, but those things are very vulnerable to any changes in the economic order.

55:56Okay, we've established the flashpoints, the problems, the structural issues. What the fuck do people do about it? Well, it depends on where you are. If you're in Germany, you probably want to get a visa. To go where? I'd come to the United States personally, but there's other options. Canada seems to be really popular, assuming they haven't closed their doors yet. But the last time we went through this evolution of economic orders and degradation for a mix of geopolitical and demographic issues, It was the 1840s. We had the German Civil Wars. A fifth of the population left. And it was the skilled fifth.

56:32Okay, let's assume that 60 % of people watching this are North Americans. And let's assume they're in their mid-30s, late 30s. They're an average millennial. What do they do in this environment for their future? Sure. Because it sounds like their future is pretty fucked. No, no, it's great. We need to double the industrial plan. That's a great story. So let me give you three things. One, from an investment point of view, anything that's going to invest in productive capacity, especially where electricity meets industry, is where the greatest expansions are going to go. I'm not going to identify any specific investment plays.

57:10That's not my world. But the idea that capital can't just boom in this sort of environment, considering the demands in front of us is silly. Number two, trades, specifically welding and electricians. Those are going to be the single most in-demand jobs for the next five to 10 years. And basically, we're already in a situation where about one or two years of experience, you can be learning six figures very, very easily. Third, Spanish. The interface between North America is amazing. And the interspace specifically between Texas and northern Mexico is absolutely epic. The biggest weakness in the North American story right now is that technology is not electricity.

57:53It's technical bilingualism. We have a lot of engineers in Mexico who don't speak English and a lot of engineers in the United States that don't speak Spanish. If we can bridge that, then you can start talking about really taking full advantage of what we have on the border. And that's a job that are in six figures within a couple of weeks. And how do financial markets do in all of this? Oh, my God. The international noise is going to be immense. And as systems falter, the capital flight that's coming to the United States is going to be absolutely gargantuan. It's probably already around$2 trillion US a year.

58:30Most of that is going into residential real estate and T-bills. If we can find a better way to capture that and apply that to the build-out problems we're going to have, we're all going to be better off. So you think the US continues to absorb the world's capital maybe at an accelerating pace. There's really no other option. And that's a much stronger dollar as well, I guess. Probably. We're probably looking at the beginning of a multi-decade US dollar run. So it's US capital market. So that's a continuation of the story we've seen already, right? In part, at least, yes. I mean, US capital markets and the dollar have been strong for essentially since 2012-ish and have been sucking more of the world's capital.

59:14I mean, Europe and others have been left behind in that equation, including China. Well, as a rule, the United States is more efficient at deploying that capital. And because it is the global store of value, and there's not even a theoretical competition ever since the BRICS removed themselves from the conversation back in November, there's really nowhere else to go. It's not that there's not enough capital for – I'm sorry. It's not that there aren't other destinations, but most of them are running a very similar system to the U.S. and are very tightly linked to the U.S. Australia, Taiwan, New Zealand, Sweden.

59:49These are also hard currencies that have a very similar political structure governing them. They're all being net beneficiaries, but only one of them is the global store of value. What about the U.K.? We talked about the U.K. The U.K. needs to make up its fucking mind. If you're watching, the average person watching this and you're from the UK, I mean, I just came back from the UK. It feels pretty miserable because nobody can see a path. It's purely a political problem. When the Brexiteers started making up everything that was going to happen on the other side of Brexit, they forgot to ask the countries that were involved in making those things happen.

1:00:24So when the UK government came to the United States in the aftermath of Brexit, You know, the United States had a very long list of things that the Brits would have to do if they wanted to get a free trade deal. And the Brexiter response was like, but that's not what we told the people. And the Trump administration was like, well, you lied to the people. You forgot to ask us. And basically, Britain has not yet come to the conclusion that if they don't accept American and Canadian and Mexican terms, it's never going to happen. So we're in this netherworld right now. We have been for seven years where the Brits are no longer in Europe, but haven't managed to turn the page to whatever is next.

1:01:02So the talk about having a trade deal with China, with India, with the United Arab Emirates or whoever it happens to be, that's all kind of irrelevant. I mean, India has trade deals with no one. China is past due. The UAE isn't a manufacturing power. It doesn't have the consumption base for it to matter. and it's too far away. There's only one play here, and that's NAFTA. And the sooner that London admits that to itself, the sooner it can get on with life. But until that happens, they're stuck in this netherworld because they're never going to get back to the EU. And I would argue at this point, they shouldn't even try.

1:01:40And the two reasons we actually missed talking about just as a final area, which is the kind of Saudi, Turkey, Iran grouping, and Israel, let's call it, whether there's a new formation of the Middle East or old wounds continue to remain open, how do you see that nexus of major regional superpowers? There's one country out of those four that matters, and that's Turkey. It's got the industrial plant, it's got the political unity, it's got the infrastructure in place. If there is going to be a new superpower in the region, it will not be Iran. It will not be Saudi Arabia. They are not intellectually capable.

1:02:19That's not a racial thing. I'm just saying they don't have the workforce necessary to even try, much less the infrastructure. Well, Iran does. It's got 70 million people and one of the highest education. It's got people who are trained. Well, they have one of the highest education rates in the world in Iran. They did in the 70s. It has degraded significantly. And when it comes to technical skills, they just don't have it. Back in the Shah's regime, they did. And there was a lot of hope there. But there's also the geographic area issue. Building infrastructure and industrial plant that spans areas requires relatively flat land.

1:02:53And Iran just doesn't have very much of that. Turkey does, especially around Siamawara. So I can see the Turks picking the parts of the Middle East they're interested in. Maybe Israel will be part of that. So that's a political question for them to work out. As the Europeans have problems, I think that the Western, or excuse me, the Eastern Balkans are a very likely addition to a Turkish circle. And based on what happens with Saudi Arabia and Iran, you know, maybe Iraq isn't in play as well. But that's their network. And I really doubt Iran and Saudi Arabia are going to be within it. They're probably going to be just on the other side of the edge because the Saudis would love to have a security guarantor that they don't border.

1:03:36and the only way Turkey can be a security guarantor for anyone in the Gulf is by taking over Iraq first and the Suns do not see that no and so if you're young and you can move around the world because you can work from anywhere the US but it's not easy to go to Australia easy to go to Canada pretty easy to go to not anymore okay the government just reduced inward migration visa approvals by 80%. So then where do you go? Latin America? You're going to have to find a way in, and you're probably going to have to be in a less than fully legal status in the meantime. There are still ways to get to the United States on a student visa, on an internship visa, and then you have to wait for politics to change so that we're a little bit more willing to accept migrants.

1:04:28The same holds for all of the other settler states. I mean, there's a very clear story here of where the economic growth is going to be. And the smart thing on the part of the settler states at the moment would be to have the doors as open as possible with an admitting immigration system because labor is in short supply and skilled labor is on the move. But we're just not there yet. No. Very interesting. Let's see where the US election leads in some of these as well. We'll wait and find out whether it changes anything. And you've got some pretty bold predictions around that as well. And yeah, it's going to be, you know, we already said it's been a hell of a year.

1:05:08Well, last year was a hell of a year, the year before that. And it feels like 2025, 26. I mean, there's a lot to come still. Yeah, we're only at the beginning of this transition. And when does it finish? Demographically, the majority of the countries that matter will be flipped over the side within 10 years. so it's between now and call it 2025 between now and 2035 is when the shit lit the fan will figure out a way through it for the countries are going to do well uh by 2040 that's a long way it is that's a long way for some which is probably probably uh when we will finally be able to apply ai at scale well let's wait and see how this all plays out peter look Fascinating talking to you and very much appreciate you coming on and giving us your insights to your very big picture and then drilling down.

1:06:05So as you can see, I always try to explore commonality of ground, commonality of understanding and explore differences. It's important for me to build on my own framework. I need to know risks. You can't just be a blind optimist without understanding them. And Peter comes with a different perspective than my own and I value that. I value a conversation like this. It doesn't make me change my mind, but I take it on board. Sometimes I have conversations that will change my mind, but I've now got some markers to know if some of my views are wrong. And that's how you've got to use information. You've got to be able to absorb information from different sources with different opinions and not attack it with your own mentality, but try and absorb it.

1:06:52Let it flow through you and see how it sits. Because often if it sits really bad with you, it means your biases are too strong. Anyway, I hope you find that useful. I'll see you on Real Vision for more, realvision.com forward slash join. See you there.

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