Alright so I’m not some expert or anything, just been paying attention and trying to connect dots, but hear me out.
The world runs on oil. Always has. And a big chunk of it still comes outta the Middle East. Every time stuff pops off over there, Europe and Asia start sweating because they need that energy to keep their economies moving. So where do they turn when it gets sketchy? Pretty much us. The U.S. has oil, LNG, all that good stuff, and Canada’s sitting on a ton of resources too. North America basically becomes the safest gas station on Earth.
This part really got me thinking. Everyone keeps freaking out about U.S. debt, like who’s gonna keep buying it. But if other countries need our energy, they need dollars to pay for it. And once they’ve got those dollars, where do they park it? Treasuries. The money just loops right back to us. Not saying the debt disappears, but it doesn’t blow up the way the doomers think either.
Then you factor in China. China imports more Middle East oil than anyone on the planet. Disrupt that flow and you’re not just squeezing Iran ,you’re squeezing China’s entire manufacturing economy. No cheap energy means higher production costs, which means their whole export advantage starts eroding. And the tariffs are already hitting them from the other side. So you’ve got a two sided squeeze cost of inputs going up, revenue from exports going down. That’s not really a trade war anymore. That’s a dismantling.
China’s also been financing American debt for decades. The whole arrangement was they make stuff cheap, we buy it, they lend us the money to do it. That loop is breaking. But……if energy dependence on the US replaces that loop, we don’t need China buying our debt anymore. Other countries will, because they need the dollars for energy. China loses its leverage completely.
What if this is actually a world being carved into two spheres. The US locks down the Western Hemisphere oil, minerals, food, LNG, all of it. Greater North America from Greenland to the Panama Canal. We control what the West needs to function. On the other side, Russia controls energy into Asia and the East. Two powers, two hemispheres, everybody else is just a customer.
And from an investing standpoint the dollar isn’t going anywhere in this scenario. It’s not just about trust anymore. It’s that the whole system runs through us. You need energy, you need dollars. You need dollars, you buy Treasuries.