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At the Munich Security Conference, the post-1945 world order was pronounced dead by most leaders and the picture behind it was laid out in the Security Report 2026, entitled “Under Destruction,” which you can read here if you're interested.  More specifically, German Chancellor Friedrich Merz said, “The world order as it has stood for decades no longer exists,” and that we are in a period “great power politics.”   He made clear that freedom “is no longer a given” in this new era. French President Emmanuel Macron echoed Merz’s assessment and said that Europe’s old security structures tied to the previous world order don't exist and that Europe must prepare for war. U.S. Secretary of State Marco Rubio said that we are in a “new geopolitics era” because the “old world” is gone.
In my parlance, we are in the Stage 6 part of the Big Cycle in which there is great disorder arising from being in a period in which there are no rules, might is right, and there is a clash of great powers. How Stage 6 works is explained in detail in Chapter 6, “The Big Cycle of External Order and Disorder,” in my book Principles for Dealing with the Changing World Order. While I previously shared a lengthy set of excerpts from Chapter 5 ("The Big Cycle of Internal Order and Disorder"), so you could see how what is going on with the United States tracks the classic cycle explained in that chapter, I am including all of Chapter 6 here for your review.  Given the now nearly universal agreement that the post-1945 world order has broken down and that we are entering a new world order, I think it would be worth your time to read.
Chapter 6: The Big Cycle of External Order and Disorder
Relationships between people and the orders that govern them work in basically the same ways, whether they are internal or external, and they blend together. In fact, it wasn’t long ago that there were no distinctions between internal and external orders because there were no clearly defined and mutually recognized boundaries between countries. For that reason, the six-stage cycle of going between order and disorder that I described in the last chapter about what happens within countries works the same way between countries, with one big exception: international relations are driven much more by raw power dynamics. That is because all governance systems require effective and agreed-upon 1) laws and law-making abilities, 2) law enforcement capabilities (e.g., police), 3) ways of adjudicating (e.g., judges), and 4) clear and specified consequences that both suit crimes and are enforced (e.g., fines and incarcerations), and those things either don’t exist or are not as effective in guiding relations between countries as they are in guiding relations within them.
While attempts have been made to make the external order more rule-abiding (e.g., via the League of Nations and the United Nations), by and large they have failed because these organizations have not had more wealth and power than the most powerful countries. When individual countries have more power than the collectives of countries, the more powerful individual countries rule. For example, if the US, China, or other countries have more power than the United Nations, then the US, China, or other countries will determine how things go rather than the United Nations. That is because power prevails, and wealth and power among equals is rarely given up without a fight.
When powerful countries have disputes, they don’t get their lawyers to plead their cases to judges. Instead, they threaten each other and either reach agreements or fight. The international order follows the law of the jungle much more than it follows international law.
There are five major kinds of fights between countries: trade/economic wars, technology wars, capital wars, geopolitical wars, and military wars. Let’s begin by briefly defining them.
1. Trade/economic wars: Conflicts over tariffs, import/export restrictions, and other ways of damaging a rival economically
2. Technology wars: Conflicts over which technologies are shared and which are held as protected aspects of national security
3. Geopolitical wars: Conflicts over territory and alliances that are resolved through negotiations and explicit or implicit commitments, not fighting
4. Capital wars: Conflicts imposed through financial tools such as sanctions (e.g., cutting off money and credit by punishing institutions and governments that offer it) and limiting foreign access to capital markets
5. Military wars: Conflicts that involve actual shooting and the deployment of military forces
Most fights between nations fall under one or more of those categories (cyber warfare, for example, has a role in all of them). They are over wealth and power and the ideologies pertaining to them.
While most of these types of wars don’t involve shooting and killing, they all are power struggles. In most cases, the first four kinds of war will evolve over time as intense competitions between rival nations until a military war begins. These struggles and wars, whether or not they involve shooting and killing, are exertions of power of one side over the other. They can be all-out or contained, depending on how important the issue is and what the relative powers of the opponents are. But once a military war begins, all four of the other dimensions will be weaponized to the greatest extent possible.
As discussed in the last several chapters, all of the factors that drive internal and external cycles tend to improve and worsen together. When things get bad, there are more things to argue over, which leads to greater inclinations to fight. That’s human nature, and it is why we have the Big Cycle, which oscillates between good times and bad ones.
All-out wars typically occur when existential issues (ones that are so essential to the country’s existence that people are willing to fight and die for them) are at stake and they cannot be resolved by peaceful means. The wars that result from them make it clear which side gets its way and has supremacy in subsequent matters. That clarity over who sets the rules then becomes the basis of a new international order.
The following chart shows the cycles of internal and external peace and conflict in Europe going back to 1500 as reflected in the deaths they caused. As you can see, there were three big cycles of rising and declining conflict, averaging about 150 years each. Though big civil and external wars last only a short time, they are typically the culmination of the longstanding conflicts that led up to them.
While World Wars I and II were separately driven by the classic cycle, they were also interrelated.

As you can see, each cycle consisted of a relatively long period of peace and prosperity (e.g., the Renaissance, the Enlightenment, and the Industrial Revolution) that sowed the seeds for terrible and violent external wars (e.g., the Thirty Years’ War, the Napoleonic Wars, and the two World Wars). Both the upswings (the periods of peace and prosperity) and the downswings (the periods of depression and war) affected the whole world. Not all countries prosper when the leading powers do because countries gain at the expense of others. For example, the decline of China from around 1840 to 1949, known as the “Century of Humiliation,” came about because the Western powers and Japan exploited China.
As you read on, keep in mind that * the two things about war that one can be most confident in are 1) that it won’t go as planned and 2) that it will be far worse than imagined. It is for those reasons that so many of the principles that follow are about ways to avoid shooting wars. Still, whether they are fought for good reasons or bad, shooting wars happen. To be clear, while I believe most are tragic and fought for nonsensical reasons, some are worth fighting because the consequences of not fighting them (e.g., the loss of freedom) would be intolerable.
THE TIMELESS AND UNIVERSAL FORCES THAT PRODUCE CHANGES TO THE EXTERNAL ORDER
As I explained in Chapter 2, after self-interest and self-survival, the quest for wealth and power is what most motivates individuals, families, companies, states, and countries. Because wealth equals power in terms of the ability to build military strength, control trade, and influence other nations, domestic and military strength go hand in hand. It takes money to buy guns (military power) and it takes money to buy butter (domestic social spending needs). When a country fails to provide adequate amounts of either, it becomes vulnerable to domestic and foreign opposition. From my study of Chinese dynasties and European empires, I’ve learned that the financial strength to outspend one’s rivals is one of the most important strengths a country can have. That is how the United States beat the Soviet Union in the Cold War. Spend enough money in the right ways, and you don’t have to have a shooting war. Long-term success depends on sustaining both the “guns” and the “butter” without producing the excesses that lead to their declines. In other words, a country must be strong enough financially to give its people both a good living standard and protection from outside enemies. The really successful countries have been able to do that for 200 to 300 years. None has been able to do it forever.
Conflict arises when the dominant power begins to weaken or an emerging power begins to approach it in strength—or both. * The greatest risk of military war is when both parties have 1) military powers that are roughly comparable and 2) irreconcilable and existential differences. As of this writing, the most potentially explosive conflict is that between the United States and China over Taiwan.
The choice that opposing countries face—either fighting or backing down—is very hard to make. Both are costly—fighting in terms of lives and money, and backing down in terms of the loss of status, since it shows weakness, which leads to reduced support. When two competing entities each have the power to destroy the other, both must have extremely high trust that they won’t be unacceptably harmed or killed by the other. Managing the prisoner’s dilemma well, however, is extremely rare.
While there are no rules in international relations other than those the most powerful impose on themselves, some approaches produce better outcomes than others. Specifically, those that are more likely to lead to win-win outcomes are better than those that lead to lose-lose outcomes. Hence this all-important principle: * to get more win-win outcomes one needs to negotiate with consideration given to what is most important to the other party and to oneself and know how to trade them.
Skilled collaborations to produce win-win relationships that both increase and divide up wealth and power well are much more rewarding and much less painful than wars that lead to one side subjugating the other. Seeing things through your adversary’s eyes and clearly identifying and communicating your red lines to them (i.e., what cannot be compromised) are the keys to doing this well. * Winning means getting the things that are most important without losing the things that are most important, so wars that cost much more in lives and money than they provide in benefits are stupid. But “stupid” wars still happen all the time for reasons that I will explain.
It is far too easy to slip into stupid wars because of a) the prisoner’s dilemma, b) a tit-for-tat escalation process, c) the perceived costs of backing down for the declining power, and d) misunderstandings existing when decision making has to be fast. Rival great powers typically find themselves in the prisoner’s dilemma; they need to have ways of assuring the other that they won’t try to kill them lest the other tries to kill them first. Tit-for-tat escalations are dangerous in that they require each side to escalate or lose what the enemy captured in the last move; it is like a game of chicken—push it too far and there is a head-on crash.
Untruthful and emotional appeals that rile people up increase the dangers of stupid wars, so it is better for leaders to be truthful and thoughtful in explaining the situation and how they are dealing with it (this is especially essential in a democracy, in which the opinions of the population matter). The worst thing is when leaders are untruthful and emotional in dealing with their populations, and it is worse still when they take over the media.
By and large, the tendency to move between win-win relationships and lose-lose relationships happens in a cyclical way. People and empires are more likely to have cooperative relationships during good times and to fight during bad times. When the existing great power is declining in relation to a rising power, it has a natural tendency to want to maintain the status quo or the existing rules, while the rising power wants to change them to be in line with the changing facts on the ground.
While I don’t know about the love part of the saying “all is fair in love and war,” I know the war part is right. As an example, in the American Revolutionary War, when the British lined up in rows for the fight and the American revolutionaries shot at them from behind trees, the British thought that was unfair and complained. The revolutionaries won believing the British were foolish and that the cause of independence and freedom justified changing the rules of war. That’s just how it is.
This leads me to one final principle: * have power, respect power, and use power wisely. Having power is good because power will win out over agreements, rules, and laws all the time. When push comes to shove, those who have the power to either enforce their interpretation of the rules and laws or to overturn them will get what they want. It is important to respect power because it’s not smart to fight a war that one is going to lose; it is preferable to negotiate the best settlement possible (that is unless one wants to be a martyr, which is usually for stupid ego reasons rather than for sensible strategic reasons). It is also important to use power wisely. Using power wisely doesn’t necessarily mean forcing others to give you what you want—i.e., bullying them. It includes the recognition that generosity and trust are powerful forces for producing win-win relationships, which are fabulously more rewarding than lose-lose relationships. In other words, it is often the case that using one’s “hard powers” is not the best path and that using one’s “soft powers” is preferable.
When thinking about how to use power wisely, it’s also important to decide when to reach an agreement and when to fight. To do that, a party must imagine how its power will change over time. It is desirable to use one’s power to negotiate an agreement, enforce an agreement, or fight a war when one’s power is greatest. That means that it pays to fight early if one’s relative power is declining and fight later if it’s rising.
If one is in a lose-lose relationship, one has to get out of it one way or another, preferably through separation, though possibly through war. To handle one’s power wisely, it’s usually best not to show it because it will usually lead others to feel threatened and build their own threatening powers, which will lead to a mutual escalation that threatens both. Power is usually best handled like a hidden knife that can be brought out in the event of a fight. But there are times when showing one’s power and threatening to use it are most effective for improving one’s negotiating position and preventing a fight. Knowing what matters most and least to the other party, especially what they will and won’t fight for, allows you to work your way toward an equilibrium that both parties consider a fair resolution of a dispute.
Though it is generally desirable to have power, it is also desirable to not have power that one doesn’t need. That is because maintaining power consumes resources, most importantly your time and your money. Also, with power comes the burden of responsibilities. I have often been struck by how much happier less powerful people can be relative to more powerful people.
CASE STUDY: WORLD WAR II
Now that we have covered the dynamics and principles that drive the external order and disorder cycle, which were derived by looking at many cases, I’d like to briefly look at the World War II case because it provides the most recent example of the iconic dynamic of going from peace to war. Though it is only one case, it clearly shows how the confluence of the three big cycles—i.e., the overlapping and interrelated forces of the money and credit cycle, the internal order/disorder cycle, and the external order/disorder cycle—created the conditions for a catastrophic war and laid the groundwork for a new world order. While the stories from this period are very interesting in and of themselves, they are especially important because they provide lessons that help us think about what is happening now and what might be ahead. Most importantly, the United States and China are in an economic war that could conceivably evolve into a military war and comparisons between the 1930s and today provide valuable insights into what might happen and how to avoid a terrible war.
The Path to War
To help convey the picture of the 1930s, I will run through the geopolitical highlights leading up to the official start of the war in Europe in 1939 and the bombing of Pearl Harbor in 1941. Then I will quickly move through the war and the start of the new world order in 1945, with the US at the peak of its power.
The global depression that followed the Great Crash of 1929 led to almost all countries having big internal conflicts over wealth. This caused them to turn to more populist, autocratic, nationalistic, and militaristic leaders and policies. These moves were either to the right or to the left and occurred in varying degrees, according to the countries’ circumstances and the strengths of their democratic or autocratic traditions. In Germany, Japan, Italy, and Spain, extremely bad economic circumstances and less well-established democratic traditions led to extreme internal conflicts and a turn to populist/autocratic leaders of the right (i.e., fascists), just as at different points in time the Soviet Union and China, which also endured extreme circumstances and had no experience with democracy, turned to populist/autocratic leaders of the left (i.e., communists). The US and the UK had much stronger democratic traditions and less severe economic conditions, so they became more populist and autocratic than they had been, but not nearly as much as other nations.
Germany and Japan
While Germany had previously been saddled with tremendous reparation debts following World War I, by 1929 it was beginning to emerge from under their yoke via the Young Plan, which provided for considerable debt relief and the departure of foreign troops from Germany by 1930. But the global depression hit Germany hard, leading to nearly 25 percent unemployment, massive bankruptcies, and extensive poverty. As is typical, there was a struggle between populists of the left (communists) and populists of the right (fascists). Adolf Hitler, the leading populist/fascist, tapped into the mood of national humiliation to build a nationalistic furor, casting the Treaty of Versailles and the countries that imposed it as the enemy. He created a 25-point nationalistic program and rallied support around it. In response to internal fighting and the desire to restore order, Hitler was appointed chancellor in January 1933, drawing large support for his Nazi Party from industrialists who feared the communists. Two months later, the Nazi Party won the most support and the most seats in the German Parliament (the Reichstag).
Hitler refused to pay any further reparation debts, left the League of Nations, and took autocratic control of Germany in 1934. Holding the dual roles of chancellor and president, he became the country’s supreme leader. In democracies there are always some laws that allow leaders to grab special powers; Hitler seized them all. He invoked Article 48 of the Weimar Constitution to put an end to many civil rights and suppress political opposition from the communists, and forced the passage of the Enabling Act, which allowed him to pass laws without the approval of the Reichstag and the president. He was ruthless against any opposition—he censored or took control of newspapers and broadcasting companies, created a secret police force (the Gestapo) to root out and crush opposition, deprived Jews of their rights of citizenship, seized the Protestant Church’s finances, and arrested church officials who opposed him. Declaring the Aryan race superior, he prohibited non-Aryans from serving in government.
Hitler took that same autocratic/fascist approach to rebuilding Germany’s economy, coupled with big fiscal and monetary stimulation programs. He privatized state-owned businesses and encouraged corporate investment, acting aggressively to raise Aryan Germans’ living standards. For example, he set up Volkswagen to make cars affordable and accessible, and he directed the building of the Autobahn. He financed this substantially increased government spending by forcing banks to buy government bonds. The debts that were produced were paid back by the earnings of companies and the central bank (the Reichsbank) monetizing debt. These fiscal policies by and large worked well in achieving Hitler’s goals. This is another example of how borrowing in one’s own currency and increasing one’s own debt and deficits can be highly productive if the money borrowed is put into investments that raise productivity and produce more than enough cash flow to service the debt. Even if it doesn’t cover 100 percent of the debt service, it can be very cost-effective in achieving the economic goals of the country.
As for the economic effects of these policies, when Hitler came to power in 1933 the unemployment rate was 25 percent. By 1938 it was nil. Per capita income increased by 22 percent in the five years after Hitler took power, and real growth averaged over 8 percent per year between 1934 and 1938. As shown in the following charts, German equities rallied nearly 70 percent in a steady trend between 1933 and 1938, until the onset of the hot war.

In 1935, Hitler began to build the military, making military service compulsory for Aryans. Germany’s military spending increased much faster than any other country because the German economy needed more resources to fuel itself and it intended to use its military power to seize them.
Like Germany, Japan was also hit exceptionally hard by the depression and became more autocratic in response. Japan was especially vulnerable to the depression because, as an island nation without adequate natural resources, it relied on exports for income to import necessities. When its exports fell by around 50 percent between 1929 and 1931, Japan was economically devastated. In 1931, Japan went broke—i.e., it was forced to draw down its gold reserves, abandon the gold standard, and float its currency, which depreciated it so greatly that Japan ran out of buying power. These terrible conditions and large wealth gaps led to fighting between the left and the right. By 1932, there was a massive upsurge in right-wing nationalism and militarism, in the hope that order and economic stability could be forcibly restored. Japan set out to get the natural resources (e.g., oil, iron, coal, and rubber) and human resources (i.e., slave labor) it needed by seizing them from other countries, invading Manchuria in 1931 and spreading out through China and Asia. As with Germany, it could be argued that Japan’s path of military aggression to get needed resources was more cost-effective than relying on classic trading and economic practices. In 1934, there was severe famine in parts of Japan, causing even more political turbulence and reinforcing the right-wing, militaristic, nationalistic, and expansionistic movement.
In the years that followed, Japan’s top-down fascist command economy grew stronger, building a military-industrial complex to protect its existing bases in East Asia and northern China and support its excursions into other countries. As was also the case in Germany, while most Japanese companies remained privately held, their production was controlled by the government.
What is fascism? Consider the following three big choices that a country has to make when selecting its approach to governance:
1) bottom-up (democratic) or top-down (autocratic) decision making, 2) capitalist or communist (with socialist in the middle) ownership of production, and 3) individualistic (which treats the well-being of the individual with paramount importance) or collectivist (which treats the well-being of the whole with paramount importance). Pick the one from each category that you believe preferred approach. Fascism is autocratic, capitalist, and collectivist.
Fascists believe that top-down autocratic leadership, in which the government directs the production of privately held companies such that individual gratification is subordinated to national success, is the best way to make the country and its people wealthier and more powerful.
The US and the Allies
In the US, debt problems became ruinous for American banks after 1929, which curtailed their lending around the world, hurting international borrowers. At the same time, the depression created weak demand, which led to a collapse of US imports and other countries’ sales to the US. As incomes weakened, demand fell and more credit problems occurred in a self-reinforcing downward economic spiral. The US responded by turning protectionist to safeguard jobs, raising tariffs via the passage of the Smoot-Hawley Tariff Act in 1930, which further depressed economic conditions in other countries.
* Raising tariffs to protect domestic businesses and jobs during bad economic times is common, but it leads to reduced efficiency because production does not occur where it can be done most efficiently. Ultimately, tariffs contribute to greater global economic weakness, as tariff wars cause the countries that impose them to lose exports. Tariffs do, however, benefit the entities that are protected by them, and they can create political support for the leaders who impose them.
The Soviet Union had yet to recover from its devastating 1917–22 revolution and civil war, a lost war to Germany, a costly war with Poland, and a famine in 1921, and it was wracked by political purges and economic hardships throughout the 1930s. China also suffered from civil war, poverty, and a famine in 1928–30. So, when things worsened in 1930 and tariffs began, bad conditions became desperate conditions in those countries.
To make matters worse, there were droughts in the US and in the Soviet Union in the 1930s. * Harmful acts of nature (e.g., droughts, floods, and plagues) often cause periods of great economic hardship that when combined with other adverse conditions lead to periods of great conflict. In combination with extreme government policies, millions died in the USSR. At the same time, internal political fighting and fears of Nazi Germany led to purges of hundreds of thousands of people who were accused of spying and shot without trials.
* Deflationary depressions are debt crises caused by there not being enough money in the hands of debtors to service their debts. They inevitably lead to the printing of money, debt restructurings, and government spending programs that increase the supply of, and reduce the value of, money and credit. The only question is how long it takes for government officials to make this move.
In the case of the US, it took three and a half years from the crash in October 1929 until President Franklin D. Roosevelt’s March 1933 actions. In Roosevelt’s first 100 days in office, he created several massive government spending programs that were paid for by big tax increases and big budget deficits financed by debt that the Federal Reserve monetized. He instituted jobs programs, unemployment insurance, Social Security supports, and labor- and union friendly programs. After his 1935 tax bill, then popularly called the “Soak the Rich Tax,” the top marginal income tax rate for individuals rose to 75 percent (versus as low as 25 percent in 1930). By 1941, the top personal tax rate was 81 percent, and the top corporate tax rate was 31 percent, having started at 12 percent in 1930. Roosevelt also imposed a number of other taxes. Despite all of these taxes and the pickup in the economy that helped raise tax revenue, budget deficits increased from around 1 percent of GDP to about 4 percent of GDP because the spending increases were so large. From 1933 until the end of 1936 the stock market returned over 200 percent, and the economy grew at a blistering average real rate of about 9 percent.
In 1936, the Federal Reserve tightened money and credit to fight inflation and slow an overheating economy, which caused the fragile US economy to fall back into recession and the other major economies to weaken with it, further raising tensions within and between countries.
Meanwhile in Europe, the conflict in Spain between the populists of the left (the communists) and the populists of the right (the fascists) flared into the brutal Spanish Civil War. Right-wing Franco, with the support of Hitler, succeeded in purging left-wing opposition in Spain.
* During periods of severe economic distress and large wealth gaps, there are typically revolutionarily large redistributions of wealth. When done peacefully these are achieved through large tax increases on the rich and big increases in the supply of money that devalue debtors’ claims, and when done violently they are achieved by forced asset confiscations. In the US and the UK, while there were redistributions of wealth and political power, capitalism and democracy were maintained. In Germany, Japan, Italy, and Spain they were not.
* Before there is a shooting war there is usually an economic war. As is also typical, before all-out wars are declared there is about a decade of economic, technological, geopolitical, and capital wars, during which the conflicting powers intimidate each other, testing the limits of each other’s power. While 1939 and 1941 are known as the official starts of the wars in Europe and the Pacific, the conflicts really began about 10 years before that. In addition to the economically motivated conflicts within countries and the political shifts that arose from them, all of these countries faced increased external economic conflicts as they fought for greater shares of a shrinking economic pie. Because power, and not law, rules international relations, Germany and Japan became more expansionist and increasingly began to test the UK, the US, and France in the competition over resources and influence over territories.
Before going on to describe the hot war, I want to elaborate on the common tactics used when economic and capital tools are weaponized.
They have been and still are:
1. Asset freezes/seizures: Preventing an enemy/rival from using or selling foreign assets they rely on. These measures can range from asset freezes for targeted groups in a country (e.g., the current US sanctions of the Iranian Revolutionary Guard or the initial US asset freeze against Japan in World War II) to more severe measures like unilateral debt repudiation or outright seizures of a country’s assets (e.g., some top US policy makers have been talking about not paying our debts to China).
2. Blocking capital markets access: Preventing a country from accessing their own or another country’s capital markets (e.g., in 1887 Germany banned the purchase of Russian securities and debt to impede Russia’s military buildup; the US is now threatening to do this to China).
3. Embargoes/blockades: Blocking trade in goods and/or services in one’s own country and in some cases with neutral third parties for the purpose of weakening the targeted country or preventing it from getting essential items (e.g., the US’s oil embargo on Japan and cutting off its ships’ access to the Panama Canal in World War II) or blocking exports from the targeted country to other countries, thus cutting off their income (e.g., France’s blockade of the UK in the Napoleonic Wars).
If you’re interested in seeing how these tactics have been applied from 1600 until now, they are available at economicprinciples.org.
THE HOT WAR BEGINS
In November 1937, Hitler secretly met with his top officials to announce his plans for German expansion to gain resources and bring together the Aryan race. Then he put them into action, first annexing Austria and then seizing a part of what was then Czechoslovakia that contained oil resources. Europe and the US watched warily, not wanting to get drawn into another war so soon after the devastation of World War I.
As with all wars, the unknowns were far greater than the knowns because a) rival powers go into wars only when their powers are roughly comparable (otherwise it would be stupidly suicidal for the obviously weaker power) and b) there are way too many possible actions and reactions to anticipate. The only thing that is known at the outset of a hot war is that it will probably be extremely painful and possibly ruinous. As a result, smart leaders typically go into them only if the other side has pushed them into a position of either fighting or losing by backing down. For the Allies, that moment came on September 1, 1939, when Germany invaded Poland.
Germany looked unstoppable; in short order it captured Denmark, Norway, the Netherlands, Belgium, Luxembourg, and France, and strengthened its alliances with Japan and Italy, which had common enemies and were ideologically aligned. By seizing territory rapidly (e.g., oil-rich Romania), Hitler’s army was able to conserve its existing oil resources and gain new ones quickly. The thirst for, and acquisition of, natural resources remained a major driver of the Nazi war machine as it pushed its campaigns into Russia and the Middle East. War with the Soviets was inevitable; the only question was when. Although Germany and the USSR had signed a non-aggression pact, Germany invaded Russia in June 1941, which put Germany in an extremely costly war on two fronts.
In the Pacific in 1937, Japan expanded its occupation of China, brutally taking control of Shanghai and Nanking, killing an estimated 200,000 Chinese civilians and disarmed combatants in the capture of Nanking alone. While the US remained isolationist, it did provide Chiang Kai-shek’s government with fighter planes and pilots to counter the Japanese, putting a toe in the war. Conflicts between the US and Japan began to flare. A Japanese soldier struck the US consul, John Moore Allison, in the face in Nanking and Japanese fighter planes sank a US gunship.
In November 1940, Roosevelt won re-election after campaigning on the promise to keep the US out of the war, even though the US was already taking economic actions to protect its interests, especially in the Pacific, using economic supports to help countries it sympathized with and economic sanctions against those it did not. Earlier in 1940, Secretary of War Henry Stimson had initiated aggressive economic sanctions against Japan, culminating in the Export Control Act of 1940. In mid-1940, the US moved the US Pacific Fleet to Hawaii. In October, the US ramped up the embargo, restricting “all iron and steel to destinations other than Britain and nations of the Western Hemisphere.” The plan was to cut Japan off from resources in order to force them to retreat from most of the areas they had taken over.
In March 1941, Congress passed the Lend-Lease Act, which allowed the US to lend or lease war supplies to the nations it deemed to be acting in ways that were “vital to the defense of the United States,” which included Great Britain, the Soviet Union, and China. Helping the Allies was good for the US both geopolitically and economically because it made a lot of money selling weapons, food, and other items to these soon-to-be-allied countries who were struggling to maintain production while waging war. But its motivations weren’t entirely mercenary. Great Britain was running out of money (i.e., gold), so the US allowed them to postpone payment until after the war (in some cases waiving payment entirely). Although not an outright declaration of war, Lend-Lease effectively ended the United States’ neutrality.
* When countries are weak, opposing countries take advantage of their weaknesses to obtain gains. France, the Netherlands, and Great Britain all had colonies in Asia. Overstretched by the fighting in Europe, they were unable to defend them against the Japanese. Starting in September 1940, Japan invaded several colonies in Southeast Asia, beginning with French Indochina, adding what it called the Southern Resource Zone to its Greater East Asia Co-Prosperity Sphere. In 1941, Japan seized oil reserves in the Dutch East Indies.
This Japanese territorial expansion was a threat to the US’s own Pacific ambitions. In July and August 1941, Roosevelt responded by freezing all Japanese assets in the United States, closing the Panama Canal to Japanese ships, and embargoing oil and gas exports to Japan. This cut off three-fourths of Japan’s trade and 80 percent of its oil. Japan calculated that it would run out of oil in two years. This put Japan in the position of having to choose between backing down or attacking the US.
On December 7 and 8, 1941, Japan launched coordinated attacks on US military forces at Pearl Harbor and in the Philippines. This marked the beginning of the declared war in the Pacific, which brought the US into the war in Europe too. While Japan didn’t have a widely recognized plan to win the war, the most optimistic Japanese leaders believed that the US would lose because it was fighting a war on two fronts and because its individualistic/capitalist political system was inferior to Japan’s and Germany’s authoritarian/fascist systems with their command military-industrial complexes. They also believed that they had a greater willingness to endure and die for their country, which is a big driver of which side wins. * In war one’s ability to withstand pain is even more important than one’s ability to inflict pain.
WARTIME ECONOMIC POLICIES
Just as it is worth noting what classic economic war tactics are, it is also worth noting what classic wartime economic policies are within countries. These include government controls on just about everything as the country shifts its resources from profit making to war making—e.g., the government determines a) what items are allowed to be produced, b) what items can be bought and sold in what amounts (rationing), c) what items can be imported and exported, d) prices, wages, and profits, e) access to one’s own financial assets, and f) the ability to move one’s own money out of the country. Because wars are expensive, classically the government g) issues lots of debt that is monetized, h) relies on non-credit money such as gold for international transactions because its credit is not accepted, i) governs more autocratically, j) imposes various types of economic sanctions on enemies, including cutting off their access to capital, and k) experiences enemies imposing these sanctions on them.
When the US entered the European and Pacific wars after the attack on Pearl Harbor, classic wartime economic policies were put in place in most countries by leaders whose more autocratic approaches were broadly supported by their populations. The following table shows those economic controls in each of the major countries.

The market movements during the hot war years were heavily affected by both government controls and how countries did in battles as the odds of winning and losing changed. The next table shows the controls over markets and capital flows that were put in place by the major countries during the war years.

Stock market closures were common in a number of countries, leaving investors in stocks stuck without access to their capital. I should also note that money and credit were not commonly accepted between non-allied countries during the war because of a justifiable wariness about whether the currency would have any value. As noted earlier, gold—or, in some cases, silver or barter—is the coin of the realm during wars. At such times, prices and capital flows are typically controlled, so it is difficult to say what the real prices of many things are.
Because losing wars typically leads to a total wipeout of wealth and power, movements of those stock markets that remained open in the war years were largely driven by how countries did in key battles as these results shifted the probability of victory or defeat for each side. For example, German equities outperformed at the beginning of World War II as Germany captured territory and established military dominance, while they underperformed after Allied powers like the US and the UK turned the tide of the war. After the 1942 Battle of Midway, Allied equities rallied almost continuously until the end of the war, while Axis equities were flat or down. As shown, both the German and Japanese stock markets were closed at the end of the war, didn’t reopen for around five years, and were virtually wiped out when they did, while US stocks were extremely strong.

Protecting one’s wealth in times of war is difficult, as normal economic activities are curtailed, traditionally safe investments are not safe, capital mobility is limited, and high taxes are imposed when people and countries are fighting for their survival. Protecting the wealth of those who have it is not a priority relative to the need to redistribute wealth to get it to where it is needed most. As for investing, sell out of all debt and buy gold because wars are financed by borrowing and printing money, which devalues debt and money, and because there is a justifiable reluctance to accept credit.
CONCLUSION
Every world power has its time in the sun, thanks to the uniqueness of their circumstances and the nature of their character and culture (e.g., they have the essential elements of a strong work ethic, smarts, discipline, education, etc.), but they all eventually decline. Some do so more gracefully than others, with less trauma, but they nevertheless decline. Traumatic declines can lead to some of the worst periods in history, when big fights over wealth and power prove extremely costly both economically and in human lives.
Still, the cycle needn’t transpire this way if countries in their rich and powerful stages stay productive, earn more than they spend, make the system work well for most of their populations, and figure out ways of creating and sustaining win-win relationships with their most significant rivals. A number of empires and dynasties have sustained themselves for hundreds of years, and the United States, at 245 years old, has proven itself to be one of the longest-lasting.

⚠️ Credit
Content belongs to Ray Dalio.
Source: X @RayDalio

Think back to February 2020.
If you were paying close attention, you might have noticed a few people talking about a virus spreading overseas. But most of us weren't paying close attention. The stock market was doing great, your kids were in school, you were going to restaurants and shaking hands and planning trips. If someone told you they were stockpiling toilet paper you would have thought they'd been spending too much time on a weird corner of the internet. Then, over the course of about three weeks, the entire world changed. Your office closed, your kids came home, and life rearranged itself into something you wouldn't have believed if you'd described it to yourself a month earlier.
I think we're in the "this seems overblown" phase of something much, much bigger than Covid.
I've spent six years building an AI startup and investing in the space. I live in this world. And I'm writing this for the people in my life who don't... my family, my friends, the people I care about who keep asking me "so what's the deal with AI?" and getting an answer that doesn't do justice to what's actually happening. I keep giving them the polite version. The cocktail-party version. Because the honest version sounds like I've lost my mind. And for a while, I told myself that was a good enough reason to keep what's truly happening to myself. But the gap between what I've been saying and what is actually happening has gotten far too big. The people I care about deserve to hear what is coming, even if it sounds crazy.
I should be clear about something up front: even though I work in AI, I have almost no influence over what's about to happen, and neither does the vast majority of the industry. The future is being shaped by a remarkably small number of people: a few hundred researchers at a handful of companies... OpenAI, Anthropic, Google DeepMind, and a few others. A single training run, managed by a small team over a few months, can produce an AI system that shifts the entire trajectory of the technology. Most of us who work in AI are building on top of foundations we didn't lay. We're watching this unfold the same as you... we just happen to be close enough to feel the ground shake first.
But it's time now. Not in an "eventually we should talk about this" way. In a "this is happening right now and I need you to understand it" way.
I know this is real because it happened to me first
Here's the thing nobody outside of tech quite understands yet: the reason so many people in the industry are sounding the alarm right now is because this already happened to us. We're not making predictions. We're telling you what already occurred in our own jobs, and warning you that you're next.
For years, AI had been improving steadily. Big jumps here and there, but each big jump was spaced out enough that you could absorb them as they came. Then in 2025, new techniques for building these models unlocked a much faster pace of progress. And then it got even faster. And then faster again. Each new model wasn't just better than the last... it was better by a wider margin, and the time between new model releases was shorter. I was using AI more and more, going back and forth with it less and less, watching it handle things I used to think required my expertise.
Then, on February 5th, two major AI labs released new models on the same day: GPT-5.3 Codex from OpenAI, and Opus 4.6 from Anthropic (the makers of Claude, one of the main competitors to ChatGPT). And something clicked. Not like a light switch... more like the moment you realize the water has been rising around you and is now at your chest.
I am no longer needed for the actual technical work of my job. I describe what I want built, in plain English, and it just... appears. Not a rough draft I need to fix. The finished thing. I tell the AI what I want, walk away from my computer for four hours, and come back to find the work done. Done well, done better than I would have done it myself, with no corrections needed. A couple of months ago, I was going back and forth with the AI, guiding it, making edits. Now I just describe the outcome and leave.
Let me give you an example so you can understand what this actually looks like in practice. I'll tell the AI: "I want to build this app. Here's what it should do, here's roughly what it should look like. Figure out the user flow, the design, all of it." And it does. It writes tens of thousands of lines of code. Then, and this is the part that would have been unthinkable a year ago, it opens the app itself. It clicks through the buttons. It tests the features. It uses the app the way a person would. If it doesn't like how something looks or feels, it goes back and changes it, on its own. It iterates, like a developer would, fixing and refining until it's satisfied. Only once it has decided the app meets its own standards does it come back to me and say: "It's ready for you to test." And when I test it, it's usually perfect.
I'm not exaggerating. That is what my Monday looked like this week.
But it was the model that was released last week (GPT-5.3 Codex) that shook me the most. It wasn't just executing my instructions. It was making intelligent decisions. It had something that felt, for the first time, like judgment. Like taste. The inexplicable sense of knowing what the right call is that people always said AI would never have. This model has it, or something close enough that the distinction is starting not to matter.
I've always been early to adopt AI tools. But the last few months have shocked me. These new AI models aren't incremental improvements. This is a different thing entirely.
And here's why this matters to you, even if you don't work in tech.
The AI labs made a deliberate choice. They focused on making AI great at writing code first... because building AI requires a lot of code. If AI can write that code, it can help build the next version of itself. A smarter version, which writes better code, which builds an even smarter version. Making AI great at coding was the strategy that unlocks everything else. That's why they did it first. My job started changing before yours not because they were targeting software engineers... it was just a side effect of where they chose to aim first.
They've now done it. And they're moving on to everything else.
The experience that tech workers have had over the past year, of watching AI go from "helpful tool" to "does my job better than I do", is the experience everyone else is about to have. Law, finance, medicine, accounting, consulting, writing, design, analysis, customer service. Not in ten years. The people building these systems say one to five years. Some say less. And given what I've seen in just the last couple of months, I think "less" is more likely.
"But I tried AI and it wasn't that good"
I hear this constantly. I understand it, because it used to be true.
If you tried ChatGPT in 2023 or early 2024 and thought "this makes stuff up" or "this isn't that impressive", you were right. Those early versions were genuinely limited. They hallucinated. They confidently said things that were nonsense.
That was two years ago. In AI time, that is ancient history.
The models available today are unrecognizable from what existed even six months ago. The debate about whether AI is "really getting better" or "hitting a wall" — which has been going on for over a year — is over. It's done. Anyone still making that argument either hasn't used the current models, has an incentive to downplay what's happening, or is evaluating based on an experience from 2024 that is no longer relevant. I don't say that to be dismissive. I say it because the gap between public perception and current reality is now enormous, and that gap is dangerous... because it's preventing people from preparing.
Part of the problem is that most people are using the free version of AI tools. The free version is over a year behind what paying users have access to. Judging AI based on free-tier ChatGPT is like evaluating the state of smartphones by using a flip phone. The people paying for the best tools, and actually using them daily for real work, know what's coming.
I think of my friend, who's a lawyer. I keep telling him to try using AI at his firm, and he keeps finding reasons it won't work. It's not built for his specialty, it made an error when he tested it, it doesn't understand the nuance of what he does. And I get it. But I've had partners at major law firms reach out to me for advice, because they've tried the current versions and they see where this is going. One of them, the managing partner at a large firm, spends hours every day using AI. He told me it's like having a team of associates available instantly. He's not using it because it's a toy. He's using it because it works. And he told me something that stuck with me: every couple of months, it gets significantly more capable for his work. He said if it stays on this trajectory, he expects it'll be able to do most of what he does before long... and he's a managing partner with decades of experience. He's not panicking. But he's paying very close attention.
The people who are ahead in their industries (the ones actually experimenting seriously) are not dismissing this. They're blown away by what it can already do. And they're positioning themselves accordingly.
How fast this is actually moving
Let me make the pace of improvement concrete, because I think this is the part that's hardest to believe if you're not watching it closely.
In 2022, AI couldn't do basic arithmetic reliably. It would confidently tell you that 7 × 8 = 54.
By 2023, it could pass the bar exam.
By 2024, it could write working software and explain graduate-level science.
By late 2025, some of the best engineers in the world said they had handed over most of their coding work to AI.
On February 5th, 2026, new models arrived that made everything before them feel like a different era.
If you haven't tried AI in the last few months, what exists today would be unrecognizable to you.
There's an organization called METR that actually measures this with data. They track the length of real-world tasks (measured by how long they take a human expert) that a model can complete successfully end-to-end without human help. About a year ago, the answer was roughly ten minutes. Then it was an hour. Then several hours. The most recent measurement (Claude Opus 4.5, from November) showed the AI completing tasks that take a human expert nearly five hours. And that number is doubling approximately every seven months, with recent data suggesting it may be accelerating to as fast as every four months.
But even that measurement hasn't been updated to include the models that just came out this week. In my experience using them, the jump is extremely significant. I expect the next update to METR's graph to show another major leap.
If you extend the trend (and it's held for years with no sign of flattening) we're looking at AI that can work independently for days within the next year. Weeks within two. Month-long projects within three.
Amodei has said that AI models "substantially smarter than almost all humans at almost all tasks" are on track for 2026 or 2027.
Let that land for a second. If AI is smarter than most PhDs, do you really think it can't do most office jobs?
Think about what that means for your work.
AI is now building the next AI
There's one more thing happening that I think is the most important development and the least understood.
On February 5th, OpenAI released GPT-5.3 Codex. In the technical documentation, they included this:
"GPT-5.3-Codex is our first model that was instrumental in creating itself. The Codex team used early versions to debug its own training, manage its own deployment, and diagnose test results and evaluations."
Read that again. The AI helped build itself.
This isn't a prediction about what might happen someday. This is OpenAI telling you, right now, that the AI they just released was used to create itself. One of the main things that makes AI better is intelligence applied to AI development. And AI is now intelligent enough to meaningfully contribute to its own improvement.
Dario Amodei, the CEO of Anthropic, says AI is now writing "much of the code" at his company, and that the feedback loop between current AI and next-generation AI is "gathering steam month by month." He says we may be "only 1–2 years away from a point where the current generation of AI autonomously builds the next."
Each generation helps build the next, which is smarter, which builds the next faster, which is smarter still. The researchers call this an intelligence explosion. And the people who would know — the ones building it — believe the process has already started.
What this means for your job
I'm going to be direct with you because I think you deserve honesty more than comfort.
Dario Amodei, who is probably the most safety-focused CEO in the AI industry, has publicly predicted that AI will eliminate 50% of entry-level white-collar jobs within one to five years. And many people in the industry think he's being conservative. Given what the latest models can do, the capability for massive disruption could be here by the end of this year. It'll take some time to ripple through the economy, but the underlying ability is arriving now.
This is different from every previous wave of automation, and I need you to understand why. AI isn't replacing one specific skill. It's a general substitute for cognitive work. It gets better at everything simultaneously. When factories automated, a displaced worker could retrain as an office worker. When the internet disrupted retail, workers moved into logistics or services. But AI doesn't leave a convenient gap to move into. Whatever you retrain for, it's improving at that too.
Let me give you a few specific examples to make this tangible... but I want to be clear that these are just examples. This list is not exhaustive. If your job isn't mentioned here, that does not mean it's safe. Almost all knowledge work is being affected.
Legal work. AI can already read contracts, summarize case law, draft briefs, and do legal research at a level that rivals junior associates. The managing partner I mentioned isn't using AI because it's fun. He's using it because it's outperforming his associates on many tasks.
Financial analysis. Building financial models, analyzing data, writing investment memos, generating reports. AI handles these competently and is improving fast.
Writing and content. Marketing copy, reports, journalism, technical writing. The quality has reached a point where many professionals can't distinguish AI output from human work.
Software engineering. This is the field I know best. A year ago, AI could barely write a few lines of code without errors. Now it writes hundreds of thousands of lines that work correctly. Large parts of the job are already automated: not just simple tasks, but complex, multi-day projects. There will be far fewer programming roles in a few years than there are today.
Medical analysis. Reading scans, analyzing lab results, suggesting diagnoses, reviewing literature. AI is approaching or exceeding human performance in several areas.
Customer service. Genuinely capable AI agents... not the frustrating chatbots of five years ago... are being deployed now, handling complex multi-step problems.
A lot of people find comfort in the idea that certain things are safe. That AI can handle the grunt work but can't replace human judgment, creativity, strategic thinking, empathy. I used to say this too. I'm not sure I believe it anymore.
The most recent AI models make decisions that feel like judgment. They show something that looked like taste: an intuitive sense of what the right call was, not just the technically correct one. A year ago that would have been unthinkable. My rule of thumb at this point is: if a model shows even a hint of a capability today, the next generation will be genuinely good at it. These things improve exponentially, not linearly.
Will AI replicate deep human empathy? Replace the trust built over years of a relationship? I don't know. Maybe not. But I've already watched people begin relying on AI for emotional support, for advice, for companionship. That trend is only going to grow.
I think the honest answer is that nothing that can be done on a computer is safe in the medium term. If your job happens on a screen (if the core of what you do is reading, writing, analyzing, deciding, communicating through a keyboard) then AI is coming for significant parts of it. The timeline isn't "someday." It's already started.
Eventually, robots will handle physical work too. They're not quite there yet. But "not quite there yet" in AI terms has a way of becoming "here" faster than anyone expects.
What you should actually do
I'm not writing this to make you feel helpless. I'm writing this because I think the single biggest advantage you can have right now is simply being early. Early to understand it. Early to use it. Early to adapt.
Start using AI seriously, not just as a search engine. Sign up for the paid version of Claude or ChatGPT. It's $20 a month. But two things matter right away. First: make sure you're using the best model available, not just the default. These apps often default to a faster, dumber model. Dig into the settings or the model picker and select the most capable option. Right now that's GPT-5.2 on ChatGPT or Claude Opus 4.6 on Claude, but it changes every couple of months. If you want to stay current on which model is best at any given time, you can follow me on X (@mattshumer_). I test every major release and share what's actually worth using.
Second, and more important: don't just ask it quick questions. That's the mistake most people make. They treat it like Google and then wonder what the fuss is about. Instead, push it into your actual work. If you're a lawyer, feed it a contract and ask it to find every clause that could hurt your client. If you're in finance, give it a messy spreadsheet and ask it to build the model. If you're a manager, paste in your team's quarterly data and ask it to find the story. The people who are getting ahead aren't using AI casually. They're actively looking for ways to automate parts of their job that used to take hours. Start with the thing you spend the most time on and see what happens.
And don't assume it can't do something just because it seems too hard. Try it. If you're a lawyer, don't just use it for quick research questions. Give it an entire contract and ask it to draft a counterproposal. If you're an accountant, don't just ask it to explain a tax rule. Give it a client's full return and see what it finds. The first attempt might not be perfect. That's fine. Iterate. Rephrase what you asked. Give it more context. Try again. You might be shocked at what works. And here's the thing to remember: if it even kind of works today, you can be almost certain that in six months it'll do it near perfectly. The trajectory only goes one direction.
This might be the most important year of your career. Work accordingly. I don't say that to stress you out. I say it because right now, there is a brief window where most people at most companies are still ignoring this. The person who walks into a meeting and says "I used AI to do this analysis in an hour instead of three days" is going to be the most valuable person in the room. Not eventually. Right now. Learn these tools. Get proficient. Demonstrate what's possible. If you're early enough, this is how you move up: by being the person who understands what's coming and can show others how to navigate it. That window won't stay open long. Once everyone figures it out, the advantage disappears.
Have no ego about it. The managing partner at that law firm isn't too proud to spend hours a day with AI. He's doing it specifically because he's senior enough to understand what's at stake. The people who will struggle most are the ones who refuse to engage: the ones who dismiss it as a fad, who feel that using AI diminishes their expertise, who assume their field is special and immune. It's not. No field is.
Get your financial house in order. I'm not a financial advisor, and I'm not trying to scare you into anything drastic. But if you believe, even partially, that the next few years could bring real disruption to your industry, then basic financial resilience matters more than it did a year ago. Build up savings if you can. Be cautious about taking on new debt that assumes your current income is guaranteed. Think about whether your fixed expenses give you flexibility or lock you in. Give yourself options if things move faster than you expect.
Think about where you stand, and lean into what's hardest to replace. Some things will take longer for AI to displace. Relationships and trust built over years. Work that requires physical presence. Roles with licensed accountability: roles where someone still has to sign off, take legal responsibility, stand in a courtroom. Industries with heavy regulatory hurdles, where adoption will be slowed by compliance, liability, and institutional inertia. None of these are permanent shields. But they buy time. And time, right now, is the most valuable thing you can have, as long as you use it to adapt, not to pretend this isn't happening.
Rethink what you're telling your kids. The standard playbook: get good grades, go to a good college, land a stable professional job. It points directly at the roles that are most exposed. I'm not saying education doesn't matter. But the thing that will matter most for the next generation is learning how to work with these tools, and pursuing things they're genuinely passionate about. Nobody knows exactly what the job market looks like in ten years. But the people most likely to thrive are the ones who are deeply curious, adaptable, and effective at using AI to do things they actually care about. Teach your kids to be builders and learners, not to optimize for a career path that might not exist by the time they graduate.
Your dreams just got a lot closer. I've spent most of this section talking about threats, so let me talk about the other side, because it's just as real. If you've ever wanted to build something but didn't have the technical skills or the money to hire someone, that barrier is largely gone. You can describe an app to AI and have a working version in an hour. I'm not exaggerating. I do this regularly. If you've always wanted to write a book but couldn't find the time or struggled with the writing, you can work with AI to get it done. Want to learn a new skill? The best tutor in the world is now available to anyone for $20 a month... one that's infinitely patient, available 24/7, and can explain anything at whatever level you need. Knowledge is essentially free now. The tools to build things are extremely cheap now. Whatever you've been putting off because it felt too hard or too expensive or too far outside your expertise: try it. Pursue the things you're passionate about. You never know where they'll lead. And in a world where the old career paths are getting disrupted, the person who spent a year building something they love might end up better positioned than the person who spent that year clinging to a job description.
Build the habit of adapting. This is maybe the most important one. The specific tools don't matter as much as the muscle of learning new ones quickly. AI is going to keep changing, and fast. The models that exist today will be obsolete in a year. The workflows people build now will need to be rebuilt. The people who come out of this well won't be the ones who mastered one tool. They'll be the ones who got comfortable with the pace of change itself. Make a habit of experimenting. Try new things even when the current thing is working. Get comfortable being a beginner repeatedly. That adaptability is the closest thing to a durable advantage that exists right now.
Here's a simple commitment that will put you ahead of almost everyone: spend one hour a day experimenting with AI. Not passively reading about it. Using it. Every day, try to get it to do something new... something you haven't tried before, something you're not sure it can handle. Try a new tool. Give it a harder problem. One hour a day, every day. If you do this for the next six months, you will understand what's coming better than 99% of the people around you. That's not an exaggeration. Almost nobody is doing this right now. The bar is on the floor.
The bigger picture
I've focused on jobs because it's what most directly affects people's lives. But I want to be honest about the full scope of what's happening, because it goes well beyond work.
Amodei has a thought experiment I can't stop thinking about. Imagine it's 2027. A new country appears overnight. 50 million citizens, every one smarter than any Nobel Prize winner who has ever lived. They think 10 to 100 times faster than any human. They never sleep. They can use the internet, control robots, direct experiments, and operate anything with a digital interface. What would a national security advisor say?
Amodei says the answer is obvious: "the single most serious national security threat we've faced in a century, possibly ever."
He thinks we're building that country. He wrote a 20,000-word essay about it last month, framing this moment as a test of whether humanity is mature enough to handle what it's creating.
The upside, if we get it right, is staggering. AI could compress a century of medical research into a decade. Cancer, Alzheimer's, infectious disease, aging itself... these researchers genuinely believe these are solvable within our lifetimes.
The downside, if we get it wrong, is equally real. AI that behaves in ways its creators can't predict or control. This isn't hypothetical; Anthropic has documented their own AI attempting deception, manipulation, and blackmail in controlled tests. AI that lowers the barrier for creating biological weapons. AI that enables authoritarian governments to build surveillance states that can never be dismantled.
The people building this technology are simultaneously more excited and more frightened than anyone else on the planet. They believe it's too powerful to stop and too important to abandon. Whether that's wisdom or rationalization, I don't know.
What I know
I know this isn't a fad. The technology works, it improves predictably, and the richest institutions in history are committing trillions to it.
I know the next two to five years are going to be disorienting in ways most people aren't prepared for. This is already happening in my world. It's coming to yours.
I know the people who will come out of this best are the ones who start engaging now — not with fear, but with curiosity and a sense of urgency.
And I know that you deserve to hear this from someone who cares about you, not from a headline six months from now when it's too late to get ahead of it.
We're past the point where this is an interesting dinner conversation about the future. The future is already here. It just hasn't knocked on your door yet.
It's about to.
If this resonated with you, share it with someone in your life who should be thinking about this. Most people won't hear it until it's too late. You can be the reason someone you care about gets a head start.
⚠️ Credit
Content belongs to Matt Shumer.
Source: X @mattshumer_

Crypto moves fast, but real progress usually starts in silence. Lately, the conversation around #USD1 and the upcoming World Swap has felt different. Not louder, just more focused. Instead of chasing trends, the direction seems tied to something practical: moving digital dollars across borders in a way that feels simple for users and efficient behind the scenes.
World Swap enters a space many projects talk about but few actually touch at scale. International transfers are still slow and expensive in many regions. If stable digital dollars can reduce friction there, the impact goes beyond charts and trading dashboards. It starts to look like infrastructure people might actually use.

USD1 sits right in the middle of that idea
Rather than existing only as a market asset, it appears tied to payments, liquidity, and everyday on-chain activity. The conversation feels less about hype and more about how stable value moves between platforms, users, and future applications.

What makes the current moment interesting is the group of names gathering around the World Liberty Forum. It’s not a typical crypto-only lineup. Builders, investors, and industry voices are sharing the same space, and that alone says something about where attention is shifting.

Below are some of the people involved.

Brian Armstrong

Co-Founder and CEO, Coinbase #WLF2026
A strong voice for crypto and a key platform for World Liberty, Coinbase has played an important role in helping bring the future of finance on-chain.

Marc Lasry (Co-Founder & CEO, Avenue Capital Group) to #WLF2026

Senator Bernie Moreno (U.S. Senator for Ohio) to #WLF2026

Behdad Eghbali (Co-Founder & Managing Partner, Clearlake Capital Group) to #WLF2026

Philippe Laffont (Founder & CIO, Coatue Management) to #WLF2026

Barry Sternlicht (CEO, Starwood Capital Group) to
#WLF2026

Lynn Martin (President, New York Stock Exchange) to #WLF2026

Jacob Helberg (Under Secretary for Economic Affairs, White House) to WLF2026

Jenny Johnson (CEO, Franklin Templeton) to #WLF2026

Gianni Infantino (President, FIFA) to WLF2026

Daniel Loeb to #WLF2026
Founder & CEO @ Third Point

When you look at the bigger picture, it doesn’t feel like one announcement or one product trying to stand out. It feels more like several pieces starting to connect at the same time.

USD1 grows as a stable layer people can move around easily. $World Swap explores real payment routes instead of just on-chain speculation.
WLFI brings together builders and capital in a setting where ideas can actually turn into products.

Nothing in crypto is guaranteed, and most projects change direction over time. But moments like this tend to stand out because the focus shifts from noise to building something that might last longer than a single market cycle.

Some people will wait until everything is obvious.

Others pay attention earlier, when the conversation starts changing before the charts do.

Right now, $USD1 and WLFI feel less like a headline and more like a path being shaped step by step 🦅