Ray Dalio reflects on Afghanistan in the wake of US Biden’s administration decision to withdraw American troops from the region marking the end of the 2001–2021 War in Afghanistan.
Afghanistan is known as the graveyard of Empires which proved as true for the Soviet Union withdrawal of Afghanistan in 1989.
So, could the US’s withdrawal of troops in Afghanistan in 2021 also symbolize an Empire in a twilight struggle?
“Afghanistan is known as the graveyard of Empires which proved as true for the Soviet Union withdrawal of Afghanistan in 1989”
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Ray Dalio reflects on Afghanistan in his latest piece entitled, “Pain + Reflections on What Went Wrong in Afghanistan Would = Progress,” posted on his Linkedin page
“The loss of the war in Afghanistan is one event in a sequence of many events that creates a dot plot that shows where we are and points to where we are headed,” wrote Ray Dalio.
So, Ray Dalio, a top global macro investors founder of the world’s largest hedge fund Bridgewater, is pointing to a roadmap leading to the decline of US hegemony, leadership, and dominance on the geopolitical stage.
Empires don’t fall overnight, if history is anything to go by then it usually takes a series of events and a growing recognition that there is a sense of decay and decline of hegemonic power.
But it is often a single event that provides the tipping point which topples the hegemony power off its throne.
“The loss of the war in Afghanistan is one event in a sequence of many events that creates a dot plot that shows where we are and points to where we are headed”
In the aftermath of World War II, Europe was devastated, its infrastructure destroyed, an estimated 75 million dead, Britain was bankrupt and its Empire was in shreds.
Then US reconstruction loans, known as the Marshall Plan, helped to reconstruct the European continent from its ruins and Britain plotted along with the GBP slowly losing its world currency reserve status.
The tipping point came for Britain during the 1956 Suez crisis when the US, the Soviet Union, and the United Nations pressurized Britain to withdraw its forces, which it did do in 1957. The Suez event signified that Britain could no longer act unilaterally, its imperial days were over and GBP has been on a steady decline ever since.
“It is important to recognize that the developments in Afghanistan have a bad effect on America’s credibility” – Ray Dalio
Ray Dalio reflects on Afghanistan, the US withdrawal of troops from the region as an event that will erode US credibility as a provider of global security
“It is important to recognize that the developments in Afghanistan have a bad effect on America’s credibility. Leaders all around the world are, in private, talking about American impotence, lack of support for its allies, and stupidity to have spent all those years, so much money, and so many lives to have lost and been forced to exist in such a humiliating way,” said Ray Dalio.
“What happened doesn’t engender confidence among America’s allies that it will be there for them when they need military help. Hence what happened was good for America’s enemies,” he added.
An Empire waning is the crux of Ray Dalio reflection on Afghanistan piece
But are the implications really that bad for the US?
Geopolitics is like a game of three-dimensional chess.
The withdrawal of troops and the literal transfer of advanced weaponry to the enemy, the Taliban, is no accident. An army in retreat never leaves their weapons behind, typically they take their weaponry, or destroy what is not possible to take with them.
We believe that this was no mistake but deliberate.
What comes next after the pandemic global lockdowns could be geopolitical chaos, leading to war
The Four Horsemen of the Apocalypse by John of Patmos in the Book of Revelation comes to mind.
Hebrew prophet Ezekiel lists them as “sword, famine, wild beasts, and plague.” … “They were given authority over a quarter of the earth, to kill with sword, famine, and plague, and by means of the beasts of the earth.”
The pale horse, pestilence, the plague has appeared and may not have been created by nature. “Rand Paul Unleashes on Dr. Fauci in Congress, You should be in jail, you created the virus” is an eye opener.
“By facilitating military mobility within the EU, we can be more effective in preventing crises” – Federica Mogherini
Ray Dalio reflects on Afghanistan, noting a global power vacuum that could lead to instability in the Middle East
Taliban are ready to carry out attacks in the Middle East and beyond.
We could be looking at potentially more geopolitical instability in the Middle East, leading to higher oil prices.
But that is what the Wall Street banks want, bearing in mind the oil sector is capital intensive, most of the funds come from Wall Street bank loans. Occidental Petroleum has the most debt at $14 billion of its $40 billion in long-term debt.
Moreover, bank CEOs have signaled that they’ll keep lending to oil companies. In other words, the banking cartel is betting on higher oil prices, even though the global economy is in a recession. So, we believe that it will be geopolitical instability in the region that could fuel future oil prices due to supply shocks.
Ray Dalio reflects on Afghanistan noting that the US withdrawal will not instill confidence amongst allies and that is likely to have implications in Europe
Back in 2018, the European Union put in motion an action plan on military mobility, in other words building an EU Defence Union by 2025.
“By facilitating military mobility within the EU, we can be more effective in preventing crises, more efficient in deploying our missions, and quicker in reacting when challenges arise. It will be another step in deepening our cooperation at the EU level, also in the framework of the Permanent Structured Cooperation we have formally launched recently, and with our partners, starting with NATO.
For us, as EU, cooperation remains the only way to be effective in today’s world,” said High Representative of the Union for Foreign Affairs and Security Policy and Vice-President Federica Mogherini.
Now we have lonely Britain in a messy exit out of the EU with a soon massive EU army a few splashes away across the channel.
So, Ray Dalio reflects on Afghanistan, as a potential end of US hegemony which could also result in greater geopolitical instability.