In the movie Wall Street, Gordon Gekko famously declares that “greed is good.” But there is another g-word that the actual Wall Street might also love, and it isn’t greed. It’s gridlock. Not the kind on the Long Island Expressway or on Route 93 entering Boston at rush hour. The kind in Washington where one party holds the White House and the other holds at least one chamber of Congress. For most of the last century, that has been the market’s preferred form of government. And it may be about to get it once again.

With two days to go until the midterms, prediction markets on Kalshi and Polymarket give Democrats roughly a 90% or better chance of taking the House and something in the mid-to-high 60s for the Senate. The single most likely outcome priced by both markets is a full Democratic sweep of Congress, at around 70% at the time of this writing. (See below for real time updates on the current prediction market percentages.) If that holds, the Trump administration goes from unified control to divided government for the first time, and investors betting on legislative paralysis will be grinning.

Why? Because a divided government seems to suggest higher returns. Ned Davis Research tracked returns of the Dow Jones Index by government configuration going back to 1901. Divided governments, where at least one chamber of Congress is held by the opposing party, returned an annualized 8.0%. Unified governments returned 4.0%. Double!

When you break it down further, the picture gets more interesting. Unified Republican government, like we have had for the past two years, is the worst of all four possibilities, at just 1.54% annualized. A Republican president with a Democratic Congress? 6.37%, more than four times the return. The best configuration of all is a Democratic president checked by a Republican Congress, at 9.60%. The market doesn’t love any particular party. It loves the restraint that comes when neither party can do whatever it wants.

To be fair, there are numerous interpretations. This is far from a settled science. A pair of Oxford economists sliced the data differently, using data from 1927 to 2017 and found the opposite: unified governments have produced higher stock returns and faster growth. Average the whole century and the two camps roughly cancel out, which might by itself be the point. Over the long sweep, party control explains far less about markets than investors assume. What matters is the starting point, and the starting point today is a unified government that has been pulling hard on every lever at once.

So how do unified and divided governments differ with respect to key economic indicators like growth and inequality?

On growth, there doesn’t seem to be much difference. Kevin Hassett, now a senior Trump economic adviser, ran the numbers back in 2010 and found that since 1970, median real GDP growth was 3.3% in years of divided government versus 3.0% under one-party rule, with median unemployment of 5.7% versus 6.1%. On the margin, divided government outperforms, albeit only slightly. Wall Street compounded the small difference into larger financial market differences. The S&P 500 rose a median 13.5% a year under divided government against 9% when one party ruled.

One consistent finding that is quite powerful, however, is that divided governments slow the growth of federal spending. Turns out the government shrinks as a share of GDP only when control is split, and that division is a necessary, if not sufficient, condition for fiscal restraint. The three balanced budgets of the late 1990s were produced by a Democratic president and a Republican Congress that could agree on little else. And given today’s runaway debt and ballooning deficits, this really matters.

So when I summarize the evidence as I read it, it seems the economy grows marginally faster under a divided government and, perhaps more importantly, doesn’t whipsaw as much. Uncertainty falls. When a unified government can plausibly rewrite trade policy, tax policy and industrial policy in a single session, every capital-spending decision bears an uncertainty premium. Remove the possibility of rapid sweeping change and that premium collapses. Businesses don’t need Washington to help. They need to know Washington will stay out of the way and leave them alone.

When it comes to inequality, the data is pretty clear. Unified Democratic control in Washington pushes the top-1% share down over time; unified Republican control pushes it up. Divided government sits in between, which is to say it leaves the distribution roughly where it was prior to the divided government getting sworn in.

The implication is that divided government is a hedge against redistribution risk in both directions. The past two years delivered tax cuts whose benefits flowed disproportionately to capital, alongside tariffs that function as a regressive consumption tax on labor and everyone else. A Democratic Congress cannot reverse either without the president’s signature. But it can block the next round.

The common belief that divided government means nothing gets done isn’t quite accurate. It’s probably better to say nothing overtly partisan gets done, but what does get done is usually consequential. Consider what has gotten done during divided governments over the last 50 years. The 1983 Social Security rescue, negotiated by Ronald Reagan and Tip O’Neill. The 1986 Tax Reform Act, the last time Washington actually simplified the code. The 1990 Clean Air Act amendments and the Americans with Disabilities Act. Welfare reform in 1996 and the Balanced Budget Act of 1997. The 2015 highway bill and the 2018 criminal justice reform.

Interestingly, none of this legislation was anyone’s first choice. All of them stuck, because legislation that needs both parties to pass tends to survive the next election, whereas legislation passed on a party-line vote gets re-litigated the moment the majority flips.

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So on the margin, the gridlock of divided government is probably good, right? Maybe. It depends. As I noted above, the starting point matters. So let’s look at where we stand after two years of a unified government:

• Tariffs that the Tax Foundation estimates cost the average household roughly $1,000 last year and another $820 this year, with the New York Fed finding that businesses and consumers absorbed nearly 90% of the burden.

• Diesel at $6.35 a gallon as of the Energy Department’s latest weekly survey, a record and up $2.63 from a year ago. A war with Iran that has kept the Strait of Hormuz effectively closed to commercial traffic for more than 240 days, with Brent at $113.

• A Federal Reserve that held rates at 3.75% to 4% this week and could not cut, with two officials dissenting in favor of a hike because inflation won’t cooperate.

• A 10-year Treasury that touched 5.2% earlier this month, a level unseen since 2007, and a 30-year still above 5.3%.

• And a stock market so stretched that the Buffett Indicator, total market capitalization to GDP, sits somewhere between 233% and 244% depending on who is counting, the highest ever recorded. At the dot-com peak it was roughly 140%. We are way above the previous bubble.

A Democratic Congress can’t really fix any of this, at least not quickly. It won’t bring diesel back to $3 or immediately end the war. But it can do something important: it can stop making things worse. No new tariffs. No more blank-check spending on AI subsidies or military adventures. No active industrial policy that crowns national champions. In the current environment, the most bullish thing Washington can do is nothing.

Bloomberg Intelligence’s Mike McGlone recently drew a scary parallel to the Hoover era: Market cap at about 2.5 times GDP, commodities surging, a Federal Reserve tightening into what may be the late innings of a cycle.

It is the kind of comparison nobody wants to make, and everybody should. It’s probably prudent to ask: Are we headed into a Depression? And if so, will that create a unification of purpose, even among a divided government?

Some will say divided government means no progress on deficit reduction, no structural reform, just two years of posturing before 2028. That may be true. But we are past the point where Washington needs to do something. We are at the point where it needs to stop doing things. Stop pouring fiscal gasoline on an inflationary fire. Stop starting trade wars. Stop starting real wars. The market doesn’t need leadership from Washington right now. It needs a breather.

I keep coming back to a line from the late MIT economist Rudiger Dornbusch: in economics, things take longer to happen than you think they will, and then they happen faster than you thought they could. The Buffett Indicator above 230%. Diesel at records. Bitcoin at $77,000, nearly 40% below its peak. Gold down 27% from its January high, and yet long Treasuries still yielding more than 5%. These are not signs of stability.

Readers know that the core theme of my work is how to navigate uncertainty. Unified governments create a lot of it, because they can act unilaterally and do many things whose ramifications they can barely fathom. That makes navigation more challenging. Divided governments find little they can agree on and little they can actually get done…which suggests whatever does get done is well-vetted, important, and usually durable.

While it’s impossible to know if we’re heading towards a more certain environment, Tuesday’s midterm results will definitely shed some light on how the next two years will feel.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

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In 1972, a journalist asked Chinese Premier Zhou Enlai about the impact of the French Revolution. His answer, the story goes, was, “It’s too early to say.” The line has become a staple of geopolitical commentary. It’s a great reminder that revolutions unfold on very long timelines (and that the Chinese generally think about dynamics over the long-term compared vs. the short attention spans of the West). Interestingly, some thought Enlai was being asked about the then-more-recent 1968 student protests that had rocked the country, but whether he was referring to 1789 or 1968, the quote is worth keeping in mind, because, as this weekend’s activity showed, the next revolution seems to be underway.

It started with a high school in Créteil. On September 21, the day after their teachers went on strike, students at the Lycée Antoine-de-Saint-Exupéry in the Paris suburbs walked out over unfilled teaching posts, classroom sizes of 35, and rooms without enough tables. By the end of the month, more than a thousand lycées were disrupted. On one day in particular, French police had arrested nearly 2,000 people (mostly minors). Within a month, the unrest had grown from just students to include teachers, parents, unions, farmers and Yellow Vest veterans. Hundreds of thousands of people were in the streets and the historic town hall in Limoges, a building that survived two world wars, was burning.

But there’s another fire that will prove harder to contain, and simply can’t be put out with water or by using tear gas to stop the rioters. I’m referring to the raging bond market fire. France’s 10-year government bond yield pushed through 5% this week, a level it hasn’t touched since 2002. Yes, France pays more than Germany and the spread has widened. But the part that should worry you is this: France now pays more to borrow than Italy. Read that again. The second-largest economy in the eurozone (indeed, a country whose fiscal credibility was a foundation that helped underwrite the euro itself) is thought to be a worse credit risk than the country it spent two decades lecturing.

Public debt stands at roughly 119% of GDP, the highest ratio since 1946, and the finance ministry’s own projection has it reaching nearly 122% next year. The deficit is running at 5.4% of GDP against a 3% EU ceiling. The interest bill alone will run about €79 billion this year and €91 billion in 2027, roughly €250 million a day, and more than France spends on defense.

So what’s being done to address the situation? The government’s budget proposal (a €54 billion “effort” to bring the deficit down to a still-bloated 5%) faces a National Assembly without a governing majority, whose finance committee has already voted it down 31 to 3, in a political environment where half a million people just marched against austerity.

This is the beginnings of a doom loop. The debt is too large to ignore and too expensive to service, but the cuts required to stabilize it are politically impossible to implement. Every failed attempt to cut spending rattles the bond market, which raises borrowing costs, which makes the debt harder to service, which demands more cuts.

The clearly vicious cycle has no end in sight. Why’s that? Because the two sides are reading from different ledgers. The students see a state that cannot replace an absent teacher for seven months during an exam year. The bond market sees a state that cannot afford the teachers it already has. Both are right. And a government with no majority, six months from a presidential election, has nothing to offer either one except promises that neither side see as credible. Ministers were told on October 6 to come back with proposals by the end of the month, and 3,000 substitute teachers have been dispatched to the worst-hit schools. The movement knows it’s just a gesture (not a budget).

The demands are not revolutionary, which I believe makes them dangerous. The lycée union’s national call named four grievances: (1) not enough teachers and staff, (2) dilapidated buildings, (3) bloated class sizes, and (4) the stress of Parcoursup, the opaque algorithm that sorts 17-year-olds into universities.

Behind those four sit the stories: a pupil who went seven months without a French teacher in a year with a French exam. Temporary classrooms that hit 40°C in last summer’s heatwave and -5°C in winter. Portable toilets with no running water. Rats. A school in Saint-Denis where, the students highlight cockroaches. The students aren’t wrong. The infrastructure of French public life is visibly deteriorating, and 62% of the French public, according to a Figaro poll, think the movement is justified.

On October 17, the demands widened and the movement expanded. The call for that day was “Yellows and Youth, Our Struggles Meet,” and the students joined an ongoing French grievance: affordability. The cost of living, fuel prices pushed up by the Iran war, pensions, wages, and the sense that the state taxes like a Scandinavian nation and provides services like a Mediterranean one. Fifteen hundred shops were destroyed and 3,000 were looted. The government is blaming the far left, the far left is blaming the police, and the only thing everybody in the street agrees on is that the solution to these problems is more money.

And that’s why I struggle to see an easy solution. There’s simple arithmetic that doesn’t care about the placards. Every euro for a teacher is a euro the bond market expects to see cut somewhere else. The protesters are asking the state to do what the bond market has said not to do.

The comparison everyone reaches for is the 1968 French “revolution,” when students took to the streets, a government was on its heels, and the president suddenly looked old. I think the analogy is wrong, or at least incomplete. Why? Because de Gaulle dissolved the Assembly and called snap elections that he won, France’s public debt was a fraction of its GDP, and the country had room to spend its way to calm. Let’s not forget that they raised the minimum wage by more than 30%.

Macron has none of the options that de Gaulle had. Could he dissolve the Assembly again? Sure, but the last time he tried that, he produced the hung parliament that has contributed to today’s problems. He can’t spend to solve the problem, because the bond market is watching. He can’t credibly promise reform, because his government is the fourth since the last election. And the political calendar means every group (Le Pen’s National Rally, Mélenchon’s France Unbowed, and the Socialists) is laser-focused on positioning, not governing.

Several of my friends who think deeply about geopolitics and geoeconomics have suggested that if the upcoming budget fails, France might have to seek assistance from the International Monetary Fund. The IMF. For France. The ECB, meanwhile, has suggested the solution to French problems lies in France. (Christine Lagarde recently noted that “the primary and first solution lies at home in France.”) Some of my friends in Europe are more relaxed about this drama, noting that France is “too big to fail.” Others suggest it’s too big to save.

The next six weeks decide a lot. The Assembly votes on the revenue half of the budget in early November and on the whole package around November 17. There’s a fascinating constitutional provision that allows a bill to pass without a vote. Will Lecornu, despite assurances he would never use this provision (Article 49.3), opt for this path? If he does, which seems likely, what happens?

I believe there are three main possibilities:

First, France could muddle through until the upcoming April elections, the government could make some token gestures such as a school reform package, and the real decisions can be deferred until the next administration takes office. Indeed, this is the default path that France seems to revert to but leads to ever higher debt, higher interest to service that debt, and a population that believes the way to get things done is via protest. I believe this is the most likely scenario.

Second, the government falls apart because of the budget. This scenario probably means an emergency law keeps spending the same, leading to a sovereign debt crisis, a bailout, and dragging Italy and Spain along for the ride. At that point, France would have to either choose submission to an EU or IMF dictated program or pursue a Brexit style defiance of Brussels.

The third scenario is that the budget leads to real reform. Think of this as a real plan to invest in schools, funded by real cuts. The bond market would love this, spreads would plunge, and France’s vicious cycle could turn virtuous. Unfortunately, I think this is the least likely scenario.

The question for the rest of Europe and for global markets is whether it stays contained. I don’t think it does, for three reasons:

1. France is critical to the euro’s architecture. The eurozone has always been understood as a core and a periphery, with Germany and France as the core and the crisis-era rescues flowing outward. When France has to raise money more richly than does Italy, the core-periphery map stops making sense. The ECB would have to address problems that it was not designed to address: a potential failure at the core. Its crisis tool are designed to help small countries hit by unwarranted panic, not for a large country whose panic is warranted.

2. The bond vigilantes reassert control. France emerges as the first large democracy where the market forced the question of what happens when you can neither raise taxes nor cut spending (nor inflate). The honest answer, the one on display in Paris, is: you pay more, until you can’t. The lesson will spread wide and far, and quickly. Expect bond market contagion.

3. Political ramifications will also spread quickly. Within days of Créteil, students in Belgium blockaded schools; Italian students declared a “No Meloni Day” and rioting spread across Milan; Greek students pitched tents outside parliament in Athens; students in Tirana attacked the education ministry. Milei’s university cuts led millions in Argentina into the streets, and in Germany, there are calls for protests in 21 cities on October 31. The narrative war over what the French unrest is about (fiscal failure, far-left agitation, inbound migration, police brutality) is already a transatlantic one, and whoever wins it will shape elections from Madrid to Berlin.

Zhou Enlai was right. It is too early to say how this ends. But a bond market at 5% portends trouble.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

In March, QatarEnergy declared force majeure on its natural gas exports. One announcement, one simple sentence. And just like that, twenty percent of the world’s liquefied natural gas (LNG) supply went offline. Seven months later, it’s still dark. In the first six months of the war, Qatar shipped 18 LNG cargoes. In the same period the year before, it shipped 509. The lost sales are valued at around $24 billion. As of this writing, there’s still no firm date for resumption.

Natural gas supplies about a quarter of the world’s energy, and LNG (gas chilled to negative 162 degrees Celsius until it liquefies and shrinks to one six-hundredth of its volume) is how it crosses oceans to countries that need it most. If you’re unfamiliar with how this actually happens, you’ll find the two minute video below worthwhile.

The importance of LNG is hard to overstate. It generates 28% of Pakistan’s electricity and half of Bangladesh’s; it heats homes across Europe and Asia; and Qatar, shipping one of every five cargoes on earth, was the market’s anchor. But LNG isn’t just fuel. It’s also feedstock for the fertilizer that grows the world’s food, for plastics such as IV bags and syringes, and for roughly a third of the world’s helium (which is used to cool MRI machines and data centers). When the LNG market is disrupted, the ripples don’t stop at your electricity bill. They reach your grocery store, your hospital, and even your hosted cloud services.

Many people think of energy production the way they think of a light switch. A simple decision can flip it off or flip it on. LNG doesn’t work that way. An LNG plant is a cryogenic facility operating at temperatures that can freeze steel and make it brittle. Shutting one down is a deliberate, staged process that must be carefully managed. It begins by reducing production to a minimum, stopping the flow of gas, and easing the pressure on upstream facilities to protect equipment.

But surely storage can mitigate the impact of a shutdown, right? Wrong. Qatar’s storage tanks at Ras Laffan (the hub of Qatar’s LNG industry) fill up in less than two days when the effort runs at normal production rates. Once full, there is no choice but to shut down.

Restarting is even more difficult than the shutdown. The process to turn on the system is deliberately slow to avoid thermal shock. Cool too quickly and you’ll crack the equipment. Multiple liquefaction trains also can’t restart at the same time; they have to be sequenced, one by one. QatarEnergy estimates it will take at least two weeks to restart, then another two weeks to reach full capacity. That’s a full month in the best case scenario—assuming no damage, no complications, and a secure shipping lane. But there is damage that must be repaired, complications that have to be addressed, and a shipping lane that remains insecure. It’s more likely, therefore, that the process to restart the system could take years.

Iranian missiles struck Ras Laffan in March, destroying two liquefaction trains; that’s 17% of Qatar’s total capacity. Analysts suggest it might take up to three years to repair. The remaining undamaged trains could restart in weeks once the Strait of Hormuz is secure, but the strait is far from secure. The IEA estimates that the conflict will strip 120 billion cubic meters from global LNG supply between 2026 and 2030. Analysts say a comfortable supply-demand balance won’t return until 2028.

The news is not all bad, however. Qatar’s North Field East expansion (a massive project begun before the war) is planning to have its first train ready to run in November. It’s expected to be producing by the first quarter of 2027. More trains will follow through 2027 and 2028, with Qatar’s capacity expected to double from 77 million tons per year to 142 million. Of course, these numbers assume no disruption to the North Field East project.

Meanwhile, the energy dominoes have begun falling around the world. EU gas storage sits 30% below its five-year average. European and Asian buyers are competing for the same LNG cargoes, bidding against each other in a market that was tight before Hormuz was closed. And because of the disruption, there are too many LNG tankers in the Atlantic basin, and not enough in Asia, impacting regional LNG freight rates.

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The consequences of the LNG disruption are far from abstract, especially if you live in a colder part of the world. New England, for instance, generates more than half its electricity from natural gas, and during arctic blasts, LNG can supply up to 35% of the region’s total gas. Pipeline capacity from Appalachia is constrained and storage is negligible. When cold snaps have hit in January, wholesale electricity prices have previously spiked to $441 per megawatt-hour. That’s triple the monthly average, and worse, that was before twenty percent of the world’s LNG went offline. And because the energy markets are interconnected, what happens in the Northeast will not stay in the Northeast. Expect a wave of higher costs to spread across the country.

And that bill will land on a consumer who was already stretched thin and worried about his or her budget. The University of Michigan’s consumer sentiment index fell to 46.3 in October, a five-month low and within sight of its all-time trough, with the gauge of current conditions plunging 12% in a single month. The survey director’s summary was blunt: “Frustration over cost-of-living continues to mount.” Little wonder. Consumer prices rose 3.7% over the past year, but energy rose 20%, and gasoline is up 34% and has sat above $4 a gallon since midsummer. Households now expect 4.7% inflation over the coming year, and they are bracing accordingly.

Now look at paychecks. The September jobs report showed the economy added just 29,000 jobs, unemployment ticked up to 4.2%, and wages grew 3.0%, the slowest pace of the post-pandemic cycle. After inflation, real earnings fell for the sixth consecutive month. Bottom line: each paycheck buys less than it did a year ago.

To cope with the situation, Americans have been bridging the gap with borrowed money. Credit card balances hit a record $1.26 trillion in the second quarter, and the share of card debt newly falling 90 or more days behind is running near 7% annualized, a level the New York Fed itself calls “elevated.” Auto loans are deteriorating at a similar pace. The mortgage picture is worse where it matters most: the share of seriously delinquent mortgages has risen for four consecutive quarters, and FHA loans (used disproportionately by first-time buyers and entry-level borrowers) are now nearly 12% delinquent, up more than a full percentage point in a year. The inventory of homes in foreclosure is up by around 20% over the same period. The household balance sheet, in other words, has no slack left in it.

In the midst of this pain, winter is coming. The Energy Information Administration’s Winter Fuels Outlook, published October 6, already forecasts the average heating-oil household paying $2,115 this winter, up 21%, as crude and tight distillate markets bite. The outlook has a more benign view of the natural gas market, driven by a belief this winter will not be as cold as normal and that US markets are self-sufficient and therefore insulated from global dynamics.

I can’t judge if this winter is going to be colder or warmer than historical averages, but I do know the Northeast is not protected from global LNG dynamics. On very cold days, New England imports LNG at world prices, and world prices are being set by the same European and Asian buyers bidding for cargoes Qatar can no longer deliver. The connection is simple: cold weather raises prices, and larger increases are possible when fuel inventories are low.

I live in New Hampshire. When temperatures drops, heat is not optional. The question is what it will cost, and what gives way when a household that was already choosing between the credit card minimum and the car payment gets a bill it never budgeted for. For millions of American families, the force majeure declared months ago, in a place most of them couldn’t find on a map, may turn out to be the straw that breaks the camel’s back. And once the camel is down, there is no switch to flip it back up.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

The frozen pizza business is booming…and that’s concerning. That probably sounds strange. But not if you understand what frozen pizza actually is, economically speaking. Frozen pizza isn’t a product. It’s a signal. And right now, the signal is flashing red.

You see, frozen pizza thrives when the economy doesn’t. In 2009, at the depths of the Great Recession, frozen pizza sales surged while restaurants sat empty. When COVID hit in 2020, sales jumped roughly a billion dollars in a single year, from $5.6 billion to $6.6 billion. The pattern is proving so reliable, it’s almost mechanical: when families start trading down from dining out to eating in, that journey includes regular stops in the frozen food aisle.

And right now? The frozen aisle is as busy as ever.

U.S. frozen pizza sales hit nearly $7 billion in 2024, part of a broader frozen food category that just crossed $87 billion annually, up dramatically since 2019. But lest you think it’s just inflation driving the numbers, think again. Unit volume is up almost 5%. People aren’t just paying more for the same stuff; they’re buying more stuff.

The foot traffic data tells a similar story. Year-over-year gains at value-focused grocery stores while pizza chain visits have gone sideways. Consumers are shifting from eating out to takeout and then on to frozen food at home as a cost-saving measure. Forty percent of consumers now say they reach for frozen foods daily, up from 35% in 2019. Nearly a third say they plan to buy even more in the year ahead, citing difficult economic circumstances.

I recently wrote about the “trench coat economy,” the idea that headline GDP growth is masking deep fragility in the broad economy. The frozen food aisle is Exhibit A. Official numbers say we’re in an expansion. The Conference Board’s Consumer Confidence Index says otherwise; it recently posted the lowest reading since May 2020. When consumers tell surveyors they’re pessimistic and then back it up by loading their carts with frozen pizza, that’s not anecdotal evidence. That’s hard data.

Here’s what I see from my perspective running a frozen pizza factory that serves major American retailers through private label offerings. Private label is a key driver of growth in the category, and we’re the last stop on the trade-down escalator. Consumers don’t switch from restaurants to private-label frozen pizza in one step. First, they cut back on fine dining. Then they downshift to fast casual. Then on to fast food. Then name-brand frozen. Then, when things get really stressed and budgets tighten even further, consumers reach for store brands.

Every week’s private label point-of-sale data is a story of families across America making trade-offs. More demand is a signal that more people are tightening their belts. If you look in the right spot, you can see consumer stress before it shows up in the confidence data.

Economists love their leading indicators: yield curves, purchasing manager surveys, housing starts. I’d like to suggest they add one more: year over year frozen pizza sales. And if they want to get more specific, private label pizza sales. When the store brands start flying off the shelves, something is happening that the GDP print isn’t catching. The disconnect between the macroeconomic statistics and the reality faced by most Americans is growing, and it points to a rapidly slowing economy.

So if you want to get a sense of where the economy is heading, look at the shopping carts of American families as they leave the supermarket.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

Interest rates are on an upward march. The 10-year Treasury just hit 5.33%; the 30-year hit 5.69%. Those are 24-year highs. But this is not just an American phenomenon. The UK 30-year punched through 6% for the first time since 1998. France’s 10-year hit its highest since 2002. The bond market is telegraphing distress.

What is going on? The answer comes down to three forces. And they’re all connected.

1. Inflation: Stimulus & War

The inflation story started with COVID. Governments flooded their economies with trillions in stimulus, central banks monetized it, and demand came roaring back before supply chains could. That was the first wave. The second wave came from two wars. Russia’s invasion of Ukraine rapidly and massively disrupted the energy and grain markets, beginning in 2022 but continuing to the present. The Iran war compounded an already problematic situation: Goldman Sachs called the Iran War the largest oil supply shock in history. Brent hit $126. Diesel is at $6.43 a gallon. The correlation between oil prices and the 10-year yield is now 0.96—nearly perfect, according to BMO Capital Markets.

I’ve written for months about the Iran War’s ripple effects—from the Strait of Hormuz and global food security to the cost of everything that moves by truck. This was never a war contained to the Middle East. It crossed the oceans through the gas pump, the grocery store, and now mortgage rates (recently north of 7%). Layer on tariffs, reshoring of supply chains, and a world bifurcating into Chinese-led and US-led economic blocs, and you get higher costs.

2. Artificial Intelligence: Competing and Concealing

Five companies have issued over $400 billion in bonds to build data centers. That’s $400 billion of investor cash that didn’t go into Treasuries. One analyst told CNBC the AI buildout is now a bigger driver of yields than inflation: “I think this year it has more to do with the bond issuance than the inflation story.”

But there’s a paradox in the AI infrastructure boom. AI capex is also the only thing making GDP growth look resilient. I’ve argued the U.S. economy might just be three data centers in a trench coat: strip out AI spending and growth is essentially zero. But the Fed looks at headline GDP, sees “strength,” and keeps rates high.

So the same buildout that’s masking a recession is also crowding the bond market and blocking the rate relief the rest of the economy needs. This “trench coat economy” has a price, and the bond market is charging it.

3. Deficits & Debt

US debt is now more than $40 trillion. The US defense budget crossed $1 trillion for the first time due in large part to the ongoing war in the Middle East. Politicians have no will to cut, and the baby bust makes the math worse: 18 consecutive years of falling US births means a shrinking tax base servicing a growing debt. And lest we think the deficit and debt problem is just an American issue, think again. OECD governments are borrowing $18 trillion this year.

The supply of bonds is exploding. Demand is thinning. Chinese surpluses that used to recycle into Treasuries are no longer heading to Washington. Japan sold a record $87.8 billion of foreign bonds in a single month to defend the yen. Domestic financial stress is forcing the repatriation of capital. The incremental buyer (and holder?) of government debt has gone from price-insensitive central banks to price-sensitive hedge funds and investment managers who demand to be paid for bearing risk.

When a country’s deficits are (or need to be) financed by foreigners who are no longer buying, the country has a choice: either pay up in yield or lets the currency depreciate. Japan is choosing yield defense. In America, similar dynamics are less severe due to the US dollars role as the global reserve currency. But persistent deficits and vanishing foreign buyers is a world where the exorbitant privilege the dollar affords the United States gets renegotiated, slowly and then, quite possibly. suddenly.

What higher rates mean

Rising rates don’t just slow an economy. They expose weaknesses.

Start with affordability. Mortgages above 7% have frozen the housing market; sellers won’t give up 3% loans and buyers can’t qualify at 7%. Credit card and auto rates are at generational highs. Add >$6 diesel and higher grocery prices, and the household budget is squeezed from both sides.

That squeeze is intensifying an already-problematic K-shaped economy. Asset owners (meaning those with paid-off homes, stock portfolios, and cash) are fine. Everyone else is not. Consumer confidence is plunging. Real estate is deteriorating. Unemployment is drifting up, and AI is part of why: the same capex that props up GDP and makes the economy appear resilient is, upon deeper scrutiny, automating white-collar work and hollowing out hiring.

Under the surface is an economy that desperately needs lower rates and can’t get them, because the trench coat makes it look like lower rates are not justified.

The wage-price spiral worry

Central bankers regularly fret about runaway inflation, the kind incited by a wage-price spiral: workers see prices rise, demand higher wages, firms raise prices to cover the wages, and the cycle feeds itself. That’s what entrenched inflation in the 1970s, and it’s a legitimate thing to watch.

But it should be a secondary concern. A wage-price spiral requires workers with bargaining power, and bargaining power requires a tight labor market. It’s hard to demand a raise when you don’t have a job. With unemployment rising, AI displacing roles, and consumer confidence collapsing, the greater risk isn’t that wages chase prices. It’s that central bankers are fighting the last war while the current one (a very weak economy wearing a strong economy’s clothes) goes unaddressed.

Three dots, one trend

Covid- and war-driven inflation. An AI boom that masks weakness while competing for capital. Growing deficits, rising debt issuance, and fewer and fewer buyers of that debt. All three dots point to an increasingly fragile economy that’s precariously teetering on the AI investment story. Time for caution.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

Regular readers of Navigating Uncertainty know that I have long felt that global multilateral institutions such as the United Nations are ineffective and, in many cases, work against the interests of their member institutions. While the concept of global governance to coordinate global responses for global challenges makes intuitive sense, it simply hasn’t worked.

Global multilateralism has lost all credibility. Do we really think the UN Security Council is useful when one of its members is the aggressor in a war that’s killed millions? Or what about the World Health Organization, which refused to investigate the origins of COVID, the world’s biggest public health challenge in a century? Surely we can’t have faith in the World Trade Organization if it doesn’t address state-sponsored intellectual property theft?

Just this week, US President Donald Trump and Argentine President Javier Milei delivered comments at the United Nations General Assembly describing the death of global multilateralism. Trump’s tariffs, tirades against NATO, pullback from Europe, refocusing of US attention on the Western Hemisphere, and willingness preference for unilateral action have delivered the “post-WWII international order” body blow after body blow. And if you doubt this trend or Trump’s intentions, listen to his blunt and defiant speech before the United Nations last week (link below).

Trump took aim at multilateralism and global institutions. He called the International Criminal Court “full of evil people” with no jurisdiction over the United States and called on nations to withdraw from it. He attacked the UN Human Rights Council for focusing on the US while overlooking abuses elsewhere. He made clear that the United States would not subordinate its sovereignty to multilateral groups, and challenged other nations to follow suit.

Remarkably, Trump was not even the most vocal critic of the UN to speak at the UN during the general assembly. Argentina’s Javier Milei took the same podium and made the American president sound like a polished career diplomat. The UN, Milei noted, was a “useless organization” that “only serves to feed a caste of parasites.” The bodies charged with guaranteeing collective security and human rights, he argued, failed at the task and allowed chaos, violence, and international terrorism to flourish, while the self-appointed defenders of human rights sheltered dictatorships and regimes that brutalize women.

Milei’s speech was stunning, and it’s worth 20 minutes of your time (link below). He described the United Nations as a “bureaucratic leviathan devoted to deciding how the peoples of the world and their citizens should live” and thereby producing a curious hybrid of anarchy and tyranny. He suggested it was impotent toward those who break the most basic rules, and exerted Orwellian control over the liberal democracies that actually follow them.

But the most important line in Milei’s speech was an eloquent caveat. Argentina, he said, will keep participating in multilateral forums in good faith but urged listeners to not “confuse cooperation with subordination.” The objection isn’t to nations working together. It’s a rejection of a permanent class of officials nobody elected claiming authority over people who never consented to it, and to “cooperation” that has quietly hardened into a sense of “obligation” in conflict with sovereignty.

Ironically, the speeches were a sideshow. The real story was what happened in the hallways. On the sidelines of the General Assembly, Trump signed a bilateral security agreement with Denmark and Greenland. He met with Venezuela’s acting president and announced a bilateral oil deal. He held one-on-one meetings with the leaders of Japan, Ukraine, and the GCC nations. The United Nations General Assembly has become a venue in which bilateral deals get done…multilateral speech is theater, the bilateral meetings are the real work.

Multilateralism has been withering for some time. The Abraham Accords were bilateral. The Iran war wasn’t authorized by the UN. Pakistan’s mediation between the US and Iran is bilateral. China’s Belt and Road Initiative is a web of bilateral deals. The European Union is struggling to hold together as Hungary and Poland resist Brussels on everything from migration to the rule of law. Everywhere you look, nationalism is resurgent and nation states are asserting their sovereignty.

So what replaces multilateralism? It’s not chaos. It’s transactional bilateralism, adorned in the language of national interest. Countries aren’t withdrawing from the international order because they’re isolationist. They’re withdrawing because these institutions no longer serve their interests, and in many cases, actively work against them. Milei and Trump are the loudest voices, but there’s a chorus of other leaders joining them. India’s Modi, China’s Xi, Turkey’s Erdogan, and Italy’s Meloni. are all prioritizing bilateral arrangements over multilateral commitments. The world is increasingly betting that sovereignty trumps solidarity.

The question, of course, is whether deal-by-deal arrangements can adequately address challenges that cross borders and impact the entire planet: climate change, pandemics, nuclear proliferation, the acceleration of AI, transnational terrorism and crime, and the regulation of the global commons. These problems don’t respect borders. They require coordination at scale. The problem is the institutions designed to provide that coordination don’t work.

It’s worth remembering, though, that we have run this experiment before — and that the first attempt failed far more spectacularly. The League of Nations was born in 1920 out of Woodrow Wilson’s conviction that collective security could replace the balance of power, and the US Senate promptly refused to join the institution its own president had designed. What followed was fifteen years of escalating humiliation. Japan invaded Manchuria in 1931 and, when the League objected, simply walked out. Germany withdrew in 1933. Italy invaded Abyssinia in 1935, and the sanctions the League imposed were so carefully calibrated to avoid offending Rome that they excluded oil. The Soviet Union was expelled in 1939 for invading Finland, by which point there was scarcely anything left to be expelled from. Nor was the League an isolated failure. The Kellogg-Briand Pact of 1928, signed by more than sixty nations, outlawed war as an instrument of national policy exactly eleven years before the deadliest war in human history.

The lesson is that multilateral institutions are not natural in a world defined by nation states. They are brief, fragile, and conditional, and they last precisely as long as their most powerful members find them useful…and not one day longer.

In 1975, Chevy Chase opened Saturday Night Live’s Weekend Update with a running gag that became the show’s first viral catchphrase. Every week, with mock seriousness, he would announce: “This just in: Generalissimo Francisco Franco is still dead.”

And so, at the risk of stealing his bit, I will say once again…this just in: multilateralism is still dead. Let it rest in peace. But let’s be honest about the cause of death: not populism, but a lack of legitimacy the institutions never took seriously.

Abraham Lincoln set the standard at Gettysburg in a set of words that captured the essence of legitimacy in governance: “government of the people, by the people, for the people.” Global multilateralism failed to incorporate this logic, instead building institutions of the elites, by the elites, and for the elites, staffed by people no voter chose and no voter can remove. As Milei noted, sovereign nations can still cooperate. They do it every day, and it has a name: diplomacy. But citizens of the world have spoken clearly over hundreds of years. They will only be governed by leaders they can fire. That clause is missing from every charter ever drafted, and until someone writes it in, multilateralism will keep dying — over and over, in exactly the same way.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

I run a frozen pizza factory in New Hampshire. We regularly have trucks pulling up to our loading dock with supplies such as flour, cheese, pepperoni, and packaging. And almost every day, trucks pull away carrying finished pizzas headed for stores across the country. Those trucks don’t run on gasoline. They run on diesel. And the average diesel price just hit $6.43 a gallon…the highest price ever recorded in the United States.

That’s not just a number I read in a headline. It’s a number I see embedded on every invoice, every cost sheet, and every freight bill that crosses my desk. And that’s probably true for most manufacturers. Inputs arrive by trucks run on diesel. Outputs depart by trucks running on diesel. And it’s a number that is quietly raising the price of everything you buy.

Let’s run through the numbers. Diesel averaged $3.69 per gallon in January 2025. Since then, it has nearly doubled and is up 58% year-over-year. Regular gasoline is $4.47; painful yes, but not unprecedented.

Why is diesel rising faster than gasoline? The simple answer is chemistry. Middle Eastern crude is heavier than American shale oil. A barrel of Middle Eastern crude yields more diesel and jet fuel per barrel than a barrel of American oil does. So when the Iran War closes the Strait of Hormuz, 14 million barrels per day of crude oil (roughly 14% of world supply) are disrupted. But the disruption on diesel is magnified. It gets disproportionately squeezed. American refiners using lighter crude can’t address the diesel challenge because, well, the chemistry doesn’t work.

And it’s not just the Iran War that’s disrupting the energy markets. Ukrainian strikes on Russian refineries have forced Moscow to ban diesel exports to protect its own domestic supply. Between the two wars, refineries with about 5 million barrels per day of capacity have been shut down, according to Valero’s chief operating officer. The world has lost nearly 8% of its diesel supply with little spare refining capacity to make up the shortfall.

Gasoline prices are noticeable to most of us because we see them every time we fill up our car or drive past a gas station. Diesel is not as visible.

But here’s the key issue: gasoline is a consumer fuel; diesel an economic one. That’s because diesel powers nearly every step of the supply chain. Most manufacturing companies receive their raw materials and packaging via diesel powered vehicles. And almost every product on every shelf in every store got there on a diesel truck. Amazon packages. Building materials. And nearly every piece of farm equipment (tractors, combines, irrigation pumps) runs on diesel.

Diesel prices drive (pardon the pun) trucking costs, which means every product that moves by a truck is impacted. When diesel prices go up, the cost of moving products (which is embedded in the price of everything!) rises. And because farmers use diesel to power their operations, higher diesel prices mean higher farming costs, which will translate into food prices going up. A similar logic leads to higher construction costs and pushes housing up, too.

Diesel may be the single most important commodity with respect to price levels, and it just hit an all-time high. It’s pushing your grocery bill up. It’s pushing your rent up. It’s even pushing up the price of your pizza. Everyone is watching the price of gasoline. But if you want to take the temperature of the economy, watch the price of diesel.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

00:00 Introducing Vikram

01:19 Freedom Fuels Innovation

01:43 Choosing America

03:30 Family Journey

06:31 Opportunity Not Outcomes

07:53 Creative Destruction

09:41 Immigration Advantage

10:29 Is America Declining

13:14 New Hampshire Freedom

14:59 Local Success Stories

18:31 Keep The City Shining

20:51 Fireside Chat Begins

21:05 Housing And Licensing

23:58 Generalist Dot Connecting

26:02 Quantum Security Risks

28:18 Closing Thanks

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

Every generation has a defining moment, one they carry with them for the rest of their lives. The one where time stops, the world changes, and all teens and adults remember where they were the moment they heard the news. These events tend to split time in a way that we thereafter demarcate life as before or after it. For our grandparents, it was Pearl Harbor. For our parents, the assassination of President John F. Kennedy. For our generation, it was the terrorist attacks of 9/11. And everyone remembers where they were.

For me, I was in Washington D.C. I was supposed to fly back to Boston on the morning of September 11, but my then-fiancée (and now wife), still at Harvard Law School, asked if I might be able to come back a bit early to help with some wedding planning. So I changed my flights and returned on Monday September 10^th. I recall flying through a thunderstorm with jarring turbulence. And on 9/11, I was at my desk when I heard the news. Friends and family, who knew I was supposed to be flying, called to check on me.

And while in shock watching the news unfold on TV, I still remember being paralyzed with panic after learning that one of my friends had departed Logan to attend meetings in Los Angeles. A few hours later, his spouse and I shared a moment of sheer joy when we learned his boss, a very wealthy man, had insisted my friend connect via Dallas to save a bit on airfare. Yes, he was LA bound, but no, he wasn’t on either of the planes that hit the towers. Other friends and former colleagues from my time on Wall Street, I later learned, were not as lucky. (For another perspective, you might want to watch President George W. Bush’s reflections on how he experienced 9/11…link below).

As I sit now and reflect on the 25th anniversary of the 9/11 attacks, it is becoming painfully obvious that for the younger folks among us, they don’t have the visceral connection or reaction to the events the way I do. It’s just something they’ve read about… or maybe heard about from parents or teachers. “Never Forget,” we said, and we haven’t. But they can’t forget memories they never had in the first place.

I do my part to help them understand what happened by recommending the video below produced by ESPN…and if you haven’t yet seen it, I recommend you do…it’s less than 15 min and is a powerful story of how 9/11 impacted those who lived through that fateful day. I’m going to now add the George Bush interview to my recommendation.

But some day there will be some event that will shape their lives the way 9/11 and Pearl Harbor shaped the lives of those who came before them. Readers of my work know that I traffic in predictions, so here are some guesses as to what that next history-altering, memory-searing event might be:

World War III. We were lulled into a false sense of security after the end of the Cold War with dreams of the “end of history,” only to have that peace shattered by Osama bin Laden. Could the end of the Global War on Terror be creating a similarly false sense of security? We seem to be sleepwalking through some very precarious, fragile and delicate times…We often focus inward, while dangerous events unfold globally. There’s the Ukraine war, the Iran war, China’s aggression…any of these could turn into a flashpoint that sets off another world war. (Side note: If you haven’t read Barbara Tuchman’s The Guns of August, I’d highly encourage you to do so as it’s a great read that sheds light on how a few seemingly localized events led to ever escalating conflict and a world war.)

Let’s not forget that Japan was invading its neighbors and Germany was making aggressive moves well before the invasion of Poland and bombing of Pearl Harbor. Could the Ukraine and Iran conflicts be a buildup to something more extreme? What will the ultimate flashpoint be? Will China finally invade Taiwan? Will Russia attack NATO? Will we see the actual use by a Great Power of nuclear weapons? Any of these have the potential to spark another world war.

Another 9/11. For all the failures of the Global War on Terror (two lost wars, a divided country, exploding deficits, diminished civil rights, the rise of the surveillance state, etc), we did win one indisputable victory. There hasn’t been another attack on the scale of 9/11 on our homeland. But that doesn’t mean there won’t be. That’s the thing about playing defense against terrorists: we have to be right every time; they only have to be right once.

Our enemies are still out there, and they are still trying to hurt us. A potential attack could take many forms that would be far more devastating than flying planes into buildings. For instance, imagine an EMP (electromagnetic pulse) attack that takes the American electricity grid down for months if not years.A catastrophic strike on our aging and outdated grid would plunge most of the country into darkness, destroy all temperature control systems protecting food and medicine, and bring life to a halt. 9/11 unified America, but today’s polarized population is less likely to unify around any such attack. In fact, the event might even generate infighting among Americans, with political consequences that could (over time) be more dire than the attack itself.

The Second American Civil War. Given the polarization and divisiveness of our politics, it’s fashionable these days to talk about our country lapsing into another civil war. Our elections are hard-fought and closely divided; both parties jockey for every advantage they can. Just as the addition of states and whether they would send pro- or anti-slavery senators to the US Senate led to the Civil War, parties today are fighting over structural advantages to defeat their opponents. Whether undocumented immigrants can vote or be counted in the census, adding justices to the court, eliminating the Electoral College, voter ID requirements, when to stop counting ballots, floating election deadlines, gerrymandered districts, additional states and the accompanying senators…these things go beyond electioneering and persuasion and seek to tilt the playing field one way or the other. It’s only a matter of time before such maneuvers go too far and delegitimize our elections. Could it lead to a civil war as political violence is seen as the only path forward?

AI breaks out. Artificial intelligence has been dominating the news as of late, and advancements have been simultaneously exciting and scary. No one truly knows what the ultimate impact will be, the heights we could reach, or the risks associated with it. The nightmare scenario would be a superintelligent, self-improving, ever-evolving AI somehow breaking out of its lab confines and running wild upon the world. Would it be benevolent? Or would the system try to help us in ways that we cannot imagine? Or would it declare war on humanity, thinking us beyond redemption or fighting a war for its very survival? Regardless, its impact would be earth-shattering and era-defining.

With our 250th birthday behind us, we can still look out upon the world and know that we are the richest and most powerful country in history, confident that any challengers can be rebuffed. Of course, there was a time when the Romans and the British could do the same, and we are all painfully aware that the lessons of history teach that empires never last forever. Will the 21st century witness the decline of American dominance? Any of the scenarios above could very well bring it about.

CLICK TO READ MY ANNUAL PREDICTIONS

Readers will know that I don’t offer predictions with an objective of accuracy. Instead, I measure the value of the predictions by their usefulness. Do they help us think differently? Can they help us navigate an uncertain world? I don’t know which of these, if any, will be the defining moment for the next generation. Nobody does. But I do know that the world is not getting safer, that the risks are not diminishing, and that the sense of invulnerability that preceded both Pearl Harbor and 9/11 is the most dangerous condition of all.

The best we can do is what we’ve always done: stay vigilant, think clearly, prepare for the scenarios we’d rather not imagine, and never assume that the peace and prosperity we enjoy today is permanent. Twenty-five years ago, on a clear September morning, we learned that lesson the hardest way possible. The question is whether we still remember it.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worth profiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

The dream of almost every immigrant who arrives on our shores is that they will be measured not by their past or their parents’ professions but instead by their own ability. And more importantly, perhaps, that the next generation will grow up in a land of opportunity. Indeed, for generations, the goal of most parents (immigrant or not) was for their children to have it better than they did.

The path chosen to achieve this goal was almost always education. Many parents (mine included) prioritized education over almost every other activity. Time and money were dedicated to schooling and support for learning. And more often than not, the system worked. Many children of immigrant households found themselves entering elite schools and finding opportunities their parents never imagined.

I am living proof that it was possible for immigrants to come here, work hard, encourage and prioritize education for their children, and to see their children enjoy better lives. But this bargain rested on an assumption nobody really had to examine, at least not until today. We knew what that an education was valuable, distinguishing, and would retain its worth indefinitely. I am no longer confident in my last sentence.

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I don’t know if there was ever a time when our country was a true meritocracy, but it certainly feels less meritocratic than it used to be. The doors of opportunity appear closed to an increasing number of people. The tip of this spear is college education, which sure seems out of reach for an average family, regardless of how talented their children may be.

The Varsity Blues scandal was perhaps the most shameless example of how far some elites were willing to go to get their kids accepted into an elite college. At least thirty-three parents paid more than $25 million to the mastermind of the scheme, Rick Singer, to secure their children seats at leading colleges. The whole affair revealed what many working-class parents had feared: college admissions were not the even playing fields they presented as being. It was also, in retrospect, the amateur version. Bribery is what you resort to when you lack a better instrument.

But perhaps the surest path to an elite education is to attend one of the feeder high schools that act as a pipeline to top colleges. Under 1% of applicants from a typical public high school get accepted at Ivy-plus universities. The number can be in the 20%-30% range for the country’s most elite private schools. These top feeders place 25 to 40 times more students at elite colleges than the national baseline. Of course, these schools are exorbitantly expensive, with tuition often running north of $60,000 per year. At least that $60,000 is paid openly, and paid by the family that benefits.

The parents of Lexington, Massachusetts may have found the best way to game the system yet: build their own feeder school…and even better, with taxpayer dollars. Lexington High School is already one of the top public feeder schools in the Greater Boston area, sending graduates to Harvard, MIT, Columbia, and the University of Pennsylvania. It’s ranked fifth in Massachusetts and 167th nationally by U.S. News. And last year, the parents of Lexington decided to take things a step further.

In December 2025, voters approved a $660 million project to tear down their 70-year-old high school and build a brand-new one. The school will be one of the most expensive public school construction projects in American history. (It’s noteworthy that the project budget was made before the Iran war led to widespread inflationary pressure, so the actual number may be significantly higher). The “Bloom” design features 440,000 square feet, an 800-seat dining center, a grab-and-go café, an enclosed courtyard, and a fully renovated field house. The state is even picking up a share of the cost, kicking in $121 million; Lexington taxpayers are carrying the remaining $533 million, financed through 30-year bonds. The cost per square foot ($1,293) works out to roughly $275,000 per kid.

Let’s be precise about what makes this work, because the obvious objection is that Lexington High is a public school open to anyone. That is true and the admission requirement is simply for the child to be living in a house in Lexington. The tuition is real, even if it is paid as a mortgage rather than to a bursar. It also happens to be partly deductible and much of it is recoverable at resale. It is the most elegant private-school payment plan ever devised.

And then there is the $121 million from the state. Lexington’s average household income is $281,187. Whatever the state money is, it is not need-based aid. It is the rest of Massachusetts helping one of its wealthiest towns preserve a competitive advantage over the rest of Massachusetts.

Let me concede a fair defense before making my point. The $275,000-per-student figure is a capital cost spread against a building meant to last forty years or more; amortized, it is a few thousand dollars a year per student, which is not by itself a scandalous number. Buildings do wear out, and the Lexington High School was seventy years old.

The number that actually matters and recurs is the debt service, the least flexible line in a municipal budget. It cannot be trimmed in a bad year. It comes ahead of teacher salaries, ahead of curriculum, and ahead of new priorities that might emerge in 2038. Lexington has not merely spent $660 million. It has pre-committed three decades of its education budget to a single decision made in a single December.

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This is a wealthy community socializing the cost of maintaining its own advantage, and doing it more skillfully than Rick Singer ever managed or imagined. But it is not the most interesting thing about the deal. The most interesting thing is that it may not actually work.

A thirty-year bond is a thirty-year bet on the value of the thing it finances. Lexington’s bondholders are protected either way; they hold a claim on the town’s tax base, not on its results. The families are not protected. What they have actually bought is not 440,000 square feet of dining center and field house. It is a potential improvement in the odds of admission to a small number of institutions. That is a positional good, and a positional good is worth exactly what the position is worth when the bill comes due.

And nobody knows what that position will be worth in 2056. A hundred years ago an educated man was someone who spoke and wrote Latin and Greek. That was not a foolish standard. It was a reasonable proxy for a mind trained to do hard things, and it held for centuries — until it stopped holding, quite quickly. Every credential is a proxy, and proxies decay when the thing underneath them changes. What does it mean to be educated in the 21st century? How will artificial intelligence impact the value of whatever our children are taught?

Nobody at the town meeting knew, and I don’t hold it against them. Nobody anywhere knows. But that uncertainty is precisely the argument for spending flexibly and reversibly on teachers, on curriculum, on things that can be changed in five years. A thirty-year general obligation bond is the least reversible instrument a town owns. Lexington answered a question about the future by pouring concrete. Worse, a recent budget shortfall had them actually cutting teachers and staff while they plan a $660 million expenditure. So the town is actually cutting education resources that will certainly impact students immediately to finance buildings with uncertain value to students. Why not make education about….well…education?

The anecdotal conversation I’m hearing is all about status, bragging rights, and the ability to someday wear the “MIT Parent” sweatshirt. Now don’t get me wrong, I’m not opposed to elite education. I’m both a product and a fan of it. But I also know it’s not for everyone. In today’s dynamic economy, the purpose and value of an elite education is unclear. It’s not zero, as some suggest. But it’s also not a sure-fire way to be profiled on “The Lifestyles of the Rich and Famous.”

Increasingly, and I would argue usefully, education is about the student and their ability to take advantage of the opportunities they encounter. For many, this may mean acquiring a trade skill and starting their own electric, plumbing, or HVAC service company. For others, it may mean acquiring nursing or other medical skills to meet the needs of an aging population. Those are not consolation prizes. They are bets on demand we can actually see from here, which is more than can be said for the one Lexington just made.

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Most decisions we make in today’s world involve tradeoffs. And while there’s no reason a community shouldn’t feel at liberty to spend two thirds of a billion dollars on a high school, it would be naïve to think it didn’t imply a set of values. A budget is a statement of belief, and Lexington’s says the binding constraint on its children’s success is the building. I doubt that. The constraint is that no one in that room (or in any comparable room in the country) can say with confidence what an educated person will need to know in twenty years.

My parents had no field house to offer me. What they had was a conviction about what mattered and the discipline to act on it, and that conviction cost nothing per square foot. Lexington’s children will graduate from the most expensive public high school ever built in America. The last coupon on that bond comes due in 2056, and only then will we know whether the credential it was meant to secure was worth securing. The bondholders don’t have to answer that question. The children of recent graduates do.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

Regular readers know that I have written quite a bit about AI and the breathtaking speed at which it has grown. Dario Amodei, the CEO of Anthropic, described the trajectory as heading toward “a country of geniuses in a datacenter.” It sure feels like the future will be filled with machines that can already outthink most humans in most domains. But it’s not just intellectually where the machines are surpassing us. It’s physically too.

Being outperformed by a machine is nothing new. After all, cars and tractors and factories full of equipment have been doing so for centuries. But the development of humanoid robots, machines built to resemble humans that walk on two legs with two moving arms, has been advancing at accelerating rate. Further, the humanoids are increasingly becoming autonomous.

All of this was on full display during the recent World Humanoid Robot Games in Beijing. Held at the National Speed Skating Oval, the very venue the PRC built for the 2022 Winter Olympics, the competition brought together over 2,000 humanoid robots from 666 teams across 16 countries. The robots competed in 51 events, from sprinting to soccer and table tennis to kickboxing. More than 40% of the events required fully autonomous operation. And by fully autonomous, I mean that there were no human operators with joysticks, remote controls, or intervention of any kind. These robots operated on their own.

Some of the achievements were staggering. China’s Tiangong Ultra clocked 9.39 seconds in the 100-meter dash; faster than Usain Bolt’s human world record of 9.58. Another robot ran 400 meters in 39.7 seconds. The pace of improvement is stunning. The fastest 100-meter time at last year’s inaugural Games was 21.5 seconds. In a mere twelve months, the robots shaved more than 12 seconds off the sprint, a 56% improvement. Human improvement in the 100-meter event has been measured in hundredths of a second per decade. Robots improved by twelve seconds in a year.

Even as robot improvements are accelerating, there are clearly still some challenges to replacing humans. They’re not perfect (yet). Just for fun, you might enjoy watching this video with some of the biggest “fails” from the Beijing event:

Of course, there’s a geopolitical angle to the humanoids as well. This event was designed to showcase China’s ambitions and capabilities, and the message was sent very loudly for the world to hear. Although teams from the United States, Germany, Japan, and Brazil participated, the overwhelming majority of competitors were Chinese.

The PRC has designated humanoid robotics as a national strategic priority, which means they have been pouring state resources into research, development, and commercialization in much the same way it did with solar panels, electric vehicles, and 5G. Beijing isn’t hosting a robot Olympics for entertainment or for social media likes. It was making a statement: Even if the United States is temporarily ahead in AI software (i.e. the brains), China holds the lead in the bodies those brains will inhabit.

And what happens when these physical machines are married to AI? You end up with a Nobel Prize-winning mathematician who is faster than Usain Bolt and stronger than Arnold Schwarzenegger. A machine that can outthink you, outrun you, and outlift you, and never needs to sleep, eat, take a vacation, or call in sick. The implications for the global economy, for labor markets, for military applications, and for daily life are staggering. The hundreds of billions that five American tech companies are spending on AI infrastructure this year isn’t just building chatbots. It’s building the brains that will eventually power the bodies that just outran the fastest human who ever lived.

So what? Why does this matter? Well, since time immemorial, there has been one truism about human societies, expressed by Auguste Comte as: “Demography is destiny.” The fates of hunter-gatherer societies and great empires alike have been determined in large part by the number of young people they have to work, fight, and reproduce. Even today, many people have suggested the future of the 21st century is being written by the baby bust in the developed world and the ramifications of the one-child policy in China.

But what if the fates of nations were untethered from how many babies were being born? Armies of robot workers and soldiers would make demographics largely irrelevant, and destinies would instead be written by whose humanoids were smartest, fastest, and strongest. And the corollary, of course, is perhaps countries with high fertility rates and young populations (i.e. those with perfect demographic pyramids!) may no longer be those with bright futures. Could it be that large populations of young workers are a liability for a country in today’s world? After all, young ambitious individuals expect jobs and not having enough jobs risks social and political unrest. And does that mean small population but wealthy countries can compete as global economic, military, or technological superpowers?

All of this is what makes the World Humanoid Robot Games more than just a curiosity. Labor is now increasingly interchangeable with technology. And if technology is increasingly accessible to anyone with capital, does this mean the age old battle between capital and labor is over? Has capital won? And if so, what are the implications for the future of wages, wealth distribution over time, and the risk of revolution?

The World Humanoid Robot Games took place in China. But unlike the saying about Las Vegas, what happens in Beijing is unlikely to stay in Beijing.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

According to the headlines, the American economy is doing fine. Not great, not terrible, but fine. GDP grew 2.0% in Q1 2026. Employment seems stable-ish. Inflation, while still above the Fed’s 2% target, looks like its moderating. The CBO projects continued economic expansion through the end of the year. Consumer spending is holding up, particularly at the upper end. The stock market is near all-time highs. Corporate earnings are strong, especially in tech.

Yet despite this news, most Americans are worried. Consumer confidence is far from ebullient. And the US economy is shed more jobs than it created in July. I’ve spent a career looking past headlines and connecting seemingly irrelevant and disparate dots. And the mosaic I’m putting together is forming a deeply concerning image.

The American economy is being disproportionately carried by one thing: the AI buildout. Five companies (known by those in the business as the “hyperscalers”) plan to spend a combined $700 to $725 billion on AI infrastructure this year alone. That’s more than the annual GDP of most countries, deployed in a single year, by Microsoft, Google, Amazon, Meta, and Nvidia. Global AI spending will likely exceed $500 billion in 2026, according to UBS.

That money is showing up directly in the GDP numbers. In Q1 2026, AI-related capital invesments contributed as much to GDP growth as all of household consumption combined. Think about that…consumption is two-thirds of GDP, and data center and AI construction matched it as a growth driver.

In 2025, Harvard economist Jason Furman analyzed how the economy might look without the AI spending. His findings are chilling. According to the analysis, AI-related investment in software and equipment accounted for 92% of GDP growth during the first half of 2025. Without it, annualized growth was 0.1%. Practically zero. But let’s remember, that was last year. Since then, AI investment has gone vertical.

Two weeks ago, Columbia Business School economist Stijn Van Nieuwerburgh said it plainly: “We’d basically be in a recession right now without data centers.” BCA Research’s Peter Berezin told the Wall Street Journal the same thing: “It’s certainly plausible that the economy would already be in a recession” without the AI boom.

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So how does the non-AI portion of the economy look? Sadly, not very healthy. The sectors that employ most Americans are slowing or shrinking. The economy that most people experience is not the economy the headline GDP numbers describe. Sure, if you’re an AI tech executive, you’re probably loving life. But if you’re like most Americans, life is a challenge. I see this every day in the demand for frozen pizza (which seems to be rising steadily), especially when compared to what’s happening at restaurants.

As regular readers know, my primary thesis in forming Goodwell Foods eighteen months ago was that economic weakness would lead people to eat at home more regularly, with frozen pizza as a big beneficiary. As such, I closely monitor developments in the restaurant industry. It shouldn’t surprise anyone that I immediately read the “Consumer Outlook” report that was published by the National Restaurant Association last week. And what I read was not encouraging regarding consumer health. I’ve pasted three charts from the report that think tell the story of the non-AI economy.

First, US employment trends point to a labor market that is struggling to create meaningful job growth. Remember, this is aggregate data for “Total US Employment” and contains the job growth from the AI buildout. If we excluded construction, energy, and tech jobs related to the AI infrastructure boom, this chart would likely look worse.

The next two charts show a US consumer that’s feeling stretched. US credit card balances are skyrocketing and are currently well over $1.25 trillion, with delinquency rates also rising rapidly. These are not the signs of healthy consumer likely who is likely to keep spending. They also imply most Americans are living “hand to mouth” and don’t have ready access to funds in the cope with medical or other emergencies.

So what does this all mean? To me, it points to an economic fragility that’s downright scary. At the very highest level, I believe we have a struggling American consumer and five companies spending three-quarters of a trillion dollars a year on a technology bet that hasn’t fully proven its commercial case.

These extremes are getting buried in aggregate statistics. I often make this dynamic clear during speeches I give by suggesting audience members put their left foot in a bucket of boiling water and their right foot in a bucket of ice water. On average, I note, you’d be comfortable.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

The most dangerous weapon in the world doesn’t exist yet, but the damage it will cause may already be done. The weapon is quantum technology, which has the potential to disrupt almost every form of communication and the protection of secrets, especially when it comes to national security. And the worst part is it’s already too late to stop the damage it will do.

But first, a quick detour into the physics of quantum computing. Every computer you’ve ever used stores information in bits, tiny switches that are either 0 or 1. Every email, every photo, every encrypted military communication, is just a very long string of 0s and 1s that are processed very fast. Quantum computing is not just an incremental improvement in speed, it’s fundamentally different. Instead of bits, it uses qubits, which can be 0, 1, or (and this is the part that makes my brain hurt) both at the same time. A qubit exists in both states simultaneously until you measure it. (This is where Schrödinger’s cat comes from—the cat is both alive and dead until you open the box.) While my PhD physicist friends may say I’m oversimplifying the difference, I’ve come to think of quantum computing as probabilistic and traditional computing as binary.

Why does this matter? Because a classical computer trying to crack an encryption key has to try every possible combination one at a time. But a quantum computer can try many combinations simultaneously. For certain types of problems—such as breaking codes, optimizing logistics, simulating molecular behavior—this approach leads to solutions that are not just determined quicker. Quantum approaches get there exponentially faster. A problem that would take a conventional computer thousands of years might take a quantum computer mere minutes.

The military implications are profound. The Defense Science Board has identified three areas where quantum technology could reshape warfare. The first is quantum sensing. Quantum sensors can navigate using the properties of atoms instead of relying on satellites. You can’t jam the atoms and their properties. You can’t shoot them down. DARPA just awarded IonQ a $28 million contract for optical atomic clocks that provide precision timing in GPS-denied environments. The implications for submarines, hypersonic missiles, and special operations in contested airspace are profound.

The second area is quantum computing, which the Pentagon estimates is at least a decade away from battlefield impact but could eventually enable breakthroughs in pattern recognition, target identification, and artificial intelligence. The Department of Defense named “Quantum and Battlefield Information Dominance” as one of its six critical technology areas and allocated $781 million for quantum technologies in FY2025.

The third is quantum communications. In theory, this approach could enable the creation of unhackable channels that use quantum mechanics to detect attempts at interception. China is working on this intensely and has already launched a quantum communications satellite and built a 2,000km quantum network between Beijing and Shanghai.

But here’s what keeps me up at night. The most dangerous quantum threat isn’t in the future. It’s in the past. The threat emerges from a strategy called “Harvest Now, Decrypt Later” and the logic is as simple as it is terrifying. Adversaries, namely China and Russia, are vacuuming up encrypted data right now. Military communications, diplomatic cables, weapons designs, intelligence reports…all of which is encrypted (and therefore unreadable) today. They’re not even trying to crack it. They’re just storing it…and waiting, patiently. Waiting for something known as Q-Day, the day a quantum computer powerful enough to break modern encryption becomes operational. Leading analysts estimate that day is less than a decade away. On Q-Day, everything that was harvested and encrypted becomes readable. Retroactive intelligence of an enormous pile of a country’s most sensitive information. Every secret transmitted over decades, unlocked in one stroke. (If you have 20 minutes, the above video will prove worth your time.)

And, perhaps most disturbingly, you can’t patch breaches that have already happened. The Cyber Threat Alliance puts it bluntly: the damage is done the moment the data is intercepted, not when it’s decrypted. The harvest is the breach. The decryption is just the reveal.

And while you and I may not care about emails sent 10 years ago about dinner reservations or a child’s soccer game, the most sensitive encrypted information (even if dated) in the national security domain is probably still very valuable. Consider these examples:

Nuclear submarine patrol routes. America’s submarines carry nuclear missiles, and their locations are among the most closely guarded secrets in the military. The entire deterrent rests on the assumption that nobody knows where they are. If China decrypts a decade of encrypted Navy communications that include patrol orders, position reports, and maintenance schedules, the CCP will be able to map patterns. Barring a wholesale change in our approach, the subs wouldn’t be as invisible, our second-strike deterrent is compromised. Not because someone hacked a submarine, but because someone read an email from 2018.

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Weapons system specifications. Encrypted communications between Lockheed Martin, the Pentagon, and subcontractors might contain the exact radar cross-section of the F-35, the vulnerabilities in its electronic warfare suite, the specific frequencies it uses, the countermeasures it’s designed to defeat. Decrypt those and you can engineer a defense against every American weapons system currently deployed. China is already suspected of having stolen F-35 designs through conventional hacking; its J-31 fighter looks suspiciously familiar. Quantum decryption might enable them to rapidly complete what they already have underway.

War plans for Taiwan. The Pentagon has detailed operational plans for defending Taiwan. Even if those plans get updated, previous versions reveal doctrinal thinking, strategic assumptions, logistics constraints, and institutional habits that don’t change quickly. Knowing the American war-fighting approach for a 2018 conflict tells you a great deal about how America might fight in 2028.

Intelligence sources. Between 2010 and 2012, China identified and killed or imprisoned at least 30 CIA sources inside the Chinese government, one of the worst intelligence disasters in American history. Nobody knows exactly how they were identified. If a harvested encrypted communication from that era names sources who survived the purge and are still active today, those people are going to be killed and American insight into the CCP will deteriorate.

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Diplomatic negotiations. Every negotiating the US has had with China over the past decade (on trade, on Taiwan, on North Korea, on Iran, on rare earths, on climate, etc) probably included encrypted cables between the State Department and embassies. Cracking the encryption and reading those cables will reveal America’s red lines, its bluffs, its internal disagreements, and its fallback positions. China would get a glimpse into American thinking, posturing, and the gaps between statements and beliefs.

The Pentagon knows all of this. In June, it published a Post-Quantum Cryptography Strategy calling the quantum future an “existential threat” to military missions and mandating that every DOD system must support quantum-resistant encryption by the end of 2030. President Trump signed two executive orders in June to accelerate the transition and the United States is planning to invest in America’s leading quantum technology companies. But here’s the problem: the strategy is forward-looking. It protects tomorrow’s secrets. It does nothing for the one’s that were captured yesterday.

We tend to think of wars as events that happen in the future…something we prepare for, something we see coming. But the information war may have already been fought, silently, over fiber-optic cables and satellite links, by adversaries who recorded everything and are simply waiting for the key.

The weapon doesn’t exist yet. But the damage may already be done. The question isn’t whether Q-Day is coming. It is. The question is how much of America’s most sensitive information is already sitting in a vault in Beijing, waiting to be read.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

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Let me tell you about the luckiest country on Earth, one most people have never even heard of. Guyana is a former British colony on the northern coast of South America with a population of 800,000 people, fewer than Austin, Texas. In 2015, ExxonMobil was drilling in the waters off Georgetown, Guyana and struck oil. What they found was staggering: over 11 billion barrels of recoverable resources in the Stabroek Block, one of the largest discoveries of the 21st century. In just 11 years, Guyana went from zero to 903,000 barrels per day, one of the fastest production ramp-ups in the history of global oil.

The numbers are staggering. Guyana has been and continues to be the fastest-growing economy on Earth, with GDP growth of 43.6% in 2024, 19.3% in 2025, and a projected 16.2% in 2026. It is now the 11th richest country in the world by GDP per capita. The government has taken in $6.2 billion in oil revenues as of late 2024, and this year’s annual revenue is projected to exceed $3 billion. A fifth offshore project, the $12.7 billion Uaru development, comes online this year, which will drive production past one million barrels per day. By 2030, Guyana could be pumping 1.9 million barrels per day, becoming South America’s second-largest producer behind Brazil (and ahead of Venezuela).

And the timing couldn’t be better. With the Strait of Hormuz effectively closed by the Iran war, the world is desperate for oil that doesn’t pass through a chokepoint. Guyana’s crude ships straight across the Atlantic to the US Gulf Coast…no Suez, no Hormuz, no Malacca. US imports from Guyana hit 261,000 barrels per day in April; that’s up 51% in just two years.

Think about it. Guyana is a country of 800,000 people, sitting on 11 billion barrels, growing at 20% a year, with no chokepoint risk, at a moment when the world’s most important shipping lane is closed. What would you call that? The luckiest country on Earth. But like all coins, however, there are two sides. Lucky, yes. But also cursed.

To begin, there’s the neighborhood. Venezuela claims sovereignty over two-thirds of Guyana’s territory, specifically the Essequibo region, a chunk of land roughly the size of Georgia. In 2023, Caracas held a referendum on annexing it. In 2024, Maduro signed the annexation into law. The disputed territory, surprise surprise, happens to contain the waters where all of Guyana’s oil is being extracted.

The case is now before the International Court of Justice, but here’s the uncomfortable reality. The claim isn’t a remnant of Maduro’s idiosyncratic rule. It commands rare consensus across Venezuela’s political spectrum, including the opposition. Regime change won’t extinguish the territorial dispute, which goes back decades. A post-Maduro government seeking legitimacy could even find nationalist utility in pressing the claim harder.

But there’s also the traditional resource curse known as Dutch Disease. The condition, repeated across decades and continents, is one in which oil wealth destroys the very economies it enriches. For Dutch Disease to take root, a country must be early in its development of institutions, lack checks and balances, and exhibit high inequality, among other conditions.

Last week, Bloomberg Opinion published an analysis titled “Oil’s Curse Is Hanging Over the World’s Fastest-Growing Economy,” and its conclusions were damning. Guyana, Bloomberg found, is fertile ground for Dutch Disease. The country, Bloomberg noted, exhibits weak institutions, inadequate transparency, widening inequality, and political power concentrated around the state. The production-sharing agreement with ExxonMobil has been criticized as lopsided. $214 million in disputed audit costs remain unresolved five years after being flagged. Procurement is opaque. Decision-making is concentrated in a handful of officials.

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And then there’s the income inequality, which creates a risk of instability. Despite being the 11th richest country in the world by GDP per capita, 58% of Guyana’s population still lives in poverty. GDP is breaking records, the sovereign wealth fund is swelling, and yet most Guyanese endure unreliable electricity, inadequate healthcare, poor drainage, rising food prices, and housing shortages. The oil boom is real and there’s no question wealth is being generated. Whether it trickles down to the ordinary citizens is an entirely different question. The risk of unrest is rising.

And then, like most things in the world these days, there’s China. The ExxonMobil consortium that controls the Stabroek Block includes China’s National Offshore Oil Corporation (CNOOC) as a 25% economic partner. A quarter of the biggest oil play in the Western Hemisphere is owned by Beijing. With Washington, DC pushing a 21^st century version of the Monroe-Doctrine and intent on getting everyone out of its neighborhood, China is already inside the deal.

So, Guyana is both lucky and cursed…but how might this contradiction resolve itself? Readers will know that I deal in probabilistic scenarios rather than predictions, and I see two paths. Guyana’s president says he wants to follow the “Norway model”, that is to say, using oil wealth to build lasting prosperity through a well-managed sovereign fund, infrastructure, and economic diversification. But Norway had 150 years of democratic institutions before it struck oil; Guyana has had seven. Venezuela said the same thing once, and Nigeria, and Angola…and that’s the second possible outcome. The same path as these failed states.

The luckiest country on Earth has 11 billion barrels of oil, the fastest-growing economy in the world, and a neighbor that claims two-thirds of its land. It has $3 billion a year in revenue flowing in and 58% of its people living in poverty. It has the Norway model as its aspiration and the Venezuela model next door as its warning.

Luck is not a strategy. And oil, as every petrostate eventually learns, is not a blessing until you prove it isn’t a curse.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

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A wave of youth-led protests has been sweeping the globe, and it is unlike anything we’ve seen since the Arab Spring. Over the past three years, Gen Z protesters have toppled governments, stormed parliaments, and forced presidents to flee their own palaces. Bloomberg suggests the unrest is being driven by a generation “crushed by soaring rents and living costs and staring down a future where robots and AI threaten their jobs.” The protests are leaderless, organized on TikTok and Discord, and spreading across three continents with a speed that has caught governments completely off guard.

Here’s the scorecard (so far):

• Sri Lanka (2022): Protesters stormed the presidential palace over economic collapse and President Rajapaksa fled the country.

• Bangladesh (2024): Students ousted PM Sheikh Hasina’s 15-year rule over a corrupt government jobs quota system; over 1,400 were killed. Nobel laureate Muhammad Yunus was installed as interim leader and Hasina was sentenced to death in absentia.

• Kenya (2024, 2026): Gen Z stormed parliament and burned part of it, forcing President Ruto to withdraw a $2.7 billion tax bill. Dozens were killed, and the protests restarted this year.

• Serbia (2024): A train station collapse in Novi Sad triggered massive anti-corruption protests led by students demanding accountability for systemic negligence.

• Nepal (2025): PM KP Sharma Oli was toppled by youth-led protests over corruption and economic mismanagement.

• Indonesia (2025): Youth protested parliamentary salary hikes and corruption in school meals. The government rescinded the salary increase.

• Morocco (2025): The “Gen-Z 212” movement was a mass protest over economic conditions. Thousands were arrested and handed harsh prison sentences.

• Philippines (2025): Corruption in flood-control projects led to protests that forced the House speaker to resign.

• Madagascar (2025): The government fell to youth protests over economic mismanagement and corruption.

• Tanzania (2025): Post-election youth protests were met with a brutal crackdown; more than 1,000 were killed.

And don’t forget about the United States. That same generational frustration and economic anger are fueling the rise of democratic socialism and leading to the elections of far-left candidates across the country, most notably in New York City.

So, what do protesters in Dhaka, Nairobi, and New York City have in common? To start, they are all young. These movements are all about promises that today’s young feel are not being honored. And these young people are for the most part over-educated and under-employed. They did what they were told—studied hard, got degrees, played by the rules. But then they discovered the economy had no place for them. Throw in the power of social media and these disruptive youth movements have viral potential; they are leaderless, decentralized…and spread quickly.

Not surprisingly, the risk of unrest is especially pronounced in countries with a youth bulge, often thought to populations where more than 20% are between 15 and 29 years of age. In Africa, for example, 60% of the population is under 25. The Council on Foreign Relations (CFR) has found that large cohorts of young adults with limited opportunities “exacerbate unemployment, prolong dependency on parents, diminish self-esteem and fuel frustrations.”

And then there’s what political scientists call the surplus male theory: the argument, laid out in Valerie Hudson’s Bare Branches, suggests societies with large numbers of young men with limited marital and economic prospects tend to either go to war or take to the streets. The logic is straightforward: young men with nothing to lose and no stake in the system are a dry tinderbox; inequality and joblessness are matches that transform their despair into protest.

It now appears it’s India’s turn. India’s Chief Justice recently called unemployed youth and social media activists “cockroaches” and “parasites.” The insult inspired a digital strategist named Abhijeet Dipke to turn the slur into a brand. The Cockroach Janta Party (CJP) went from satirical meme into one of the fastest growing political movements in Indian history.

Recent revelations of corruption have thrown fuel onto a simmering fire leading to significant youth unrest. Massive paper leaks in India’s 2026 national examinations, including the NEET medical entrance exam, led many to believe the supposed meritocracy of exams was a smokescreen hiding corruption. In a country where exam scores determine your career, your income, and your marriage prospects, a rigged exam is more than a scandal, it’s an existential crisis. Students who studied for years learned the test had been sold before it was presented. Some committed suicide.

Thousands of young people camped on the streets of New Delhi. On July 20, over 10,000 tried to march to Parliament, but were turned away as police fired tear gas and beat activists with batons. 150 protesters were wounded. Multiple videos showed the police attacking marchers; no footage has emerged of any violence by the protesters. Opposition leader Rahul Gandhi was detained.

And then, unexpectedly, the government blinked. On July 25, Education Minister Dharmendra Pradhan resigned. Given the Modi government rarely concedes anything, I found it significant that it agreed to all three of the CJP demands: (a) Pradhan’s resignation; (b) no prosecution of protesters; and (c) compensation for families of students who died. CNBC called it the moment India’s Gen Z “forced Modi to listen, respond and act…exposing chinks in the ruling party’s armor.”

It seems the cockroaches won. And the playbook was identical to every other Gen Z revolt on the list. Begin with social media organizing. Have a leaderless movement structure. Exhibit moral clarity and clear objectives. And have a willingness to endure resistance (including beatings in the street) until the government either cracks down harder or gives in. India’s Chief Justice called them parasites. Around two months later, the education minister was forced to resign.

The Journal of Democracy warns that toppling a leader is the easy part. The harder question is whether any of this translates into lasting change. Will the movements create jobs, affordable housing, or exams that aren’t rigged? History suggests they probably won’t, but this generation doesn’t seem interested in waiting to find out. These battles will be long and drawn out but today’s youth are resilient and determined. I wouldn’t bet against them. After all, cockroaches are among nature’s most accomplished survivors.

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.

As many of you are aware, I run a frozen pizza factory. Pepperoni pizza is one of our best sellers, so it should not be surprising that I spend a lot of time thinking about pork prices. And while the price of your pizza is obviously impacted by the price of pepperoni on top of it, you may find it interesting that the price is increasingly being set in Beijing, not in Iowa or North Carolina.

How’s that? Well, it turns out that the Middle Kingdom is the world’s largest consumer of pork. China consumes 57 million metric tons of pork per year—roughly half of all the pork eaten on Earth. And pork in China isn’t like chicken in America. The Chinese character for “home” (家) is literally a pig under a roof and pork is deeply intertwined with Chinese culture. So when anything disrupts China’s pork supply (such as a disease, tariff, or trade war), shockwaves flow through global markets. Including, eventually, to the pepperoni we put on pizzas in America.

But there’s an interesting twist to the story that very few people talk about. China doesn’t just buy American pork chops and tenderloins. It buys the parts of the pig that Americans won’t touch: the feet, the heads, the stomachs, the ears, the hearts. China takes 59% of all US pork “variety meat” exports. The National Pork Producers Council puts it bluntly: “There is no alternative market” that can absorb this volume.

Why does this matter for pepperoni? Because the revenue from selling those pig feet to China subsidizes the cost of the rest of the pig. Every part of the animal that gets sold offshore reduces the effective cost of the trim that stays here—the trim that gets cured, fermented, and turned into pepperoni. When China stops buying feet, that revenue vanishes, and the cost of producing the cuts Americans do eat goes up. Pig feet you’ve never thought of and will probably never eat quietly keep your favorite pizza affordable.

And of course the buying slows to a trickle whenever the trade war heats up. Over the past several years, US pork tariffs in China have swung from 12% to 81%. At 81%, trade effectively stops. The November 2025 deal brought tariffs down and granted waivers on the worst duties, but those waivers expire at the end of 2026. The pork industry received a reprieve, not a resolution.

But these dynamics, we must remember, work in two directions. When China needs pork, it doesn’t just buy, it hoovers up whatever it can find. In 2018, African Swine Fever killed roughly half of China’s pig herd, hundreds of millions of animals. Chinese pork prices spiked 46.7% in a single year. China bought everything it could find on the global market, pulling supply away from processors everywhere, including the ones making pepperoni for American pizza companies. They also made massive investments into their domestic pork industry, including the now infamous “pig skyscrapers.”

Separately, there’s also a twist steeped in international intrigue. Smithfield Foods (America’s largest pork producer, responsible for 23% of the entire US pork market) is owned by China’s WH Group. The Chinese company bought it for $4.7 billion in 2013.

I remember speaking with Congressional leaders then and many were concerned about the impact the acquisition might have on food safety. Many were concerned that Chinese food safety standards would transform the US food company and put our hot dogs or bacon at risk. I remember discussing it with Smithfield executives at the time who were confused by this suggestion, and correctly (it turns out) noted that the Chinese were seeking to learn US food safety procedures so they could take them to China.

Nevertheless, the concern about Chinese ownership of US agriculture and food assets has not dissipated. In 2023, for instance, Virginia passed a law banning “foreign adversaries” from owning farmland in the state. Well, it turns out that Smithfield has farms in Virginia. One national security critic put the concern simply: “If we get into some sort of world disaster, where do you think China’s going to send their pork? They’re going to send it back to China.” Who would have thought that pepperoni could be a national security issue?

These dynamics are a useful reminder that something as simple as pizza is an amalgamation of countless supply chains, geopolitical dynamics, disease, weather, and politics. Even small events happening on the other side of the globe can ripple through the economy and impact the price of frozen pizza. Connecting these seemingly unrelated dots can help us understand the levers that impact prices and drive supply. The geoeconomics of the pork industry may seem large and lofty and irrelevant to most, but can, via the price of pepperoni, impact the price of your pizza.

The price of pepperoni was shaped by a tariff negotiated in Geneva, a pig disease that started in a province most Americans can’t pronounce, an acquisition that handed a quarter of America’s pork supply to a Chinese conglomerate, and 59% of the pig (parts no one here will eat) being shipped across the Pacific. Think about that next time you take a bite of a slice!

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VIKRAM MANSHARAMANI is an entrepreneur, consultant, scholar, neighbor, husband, father, volunteer, and professional generalist who thinks in multiple-dimensions and looks beyond the short-term. Self-taught to think around corners and connect original dots, he spends his time speaking with global leaders in business, government, academia, and journalism. He’s currently the Chairman and CEO of Goodwell Foods, a manufacturer of private label frozen pizza. LinkedIn has twice listed him as its #1 Top Voice in Money & Finance, and Worthprofiled him as one of the 100 Most Powerful People in Global Finance. Vikram earned a PhD From MIT, has taught at Yale and Harvard, and is the author of three books, The Making of a Generalist: An Independent Thinker Finds Unconventional Success in an Uncertain World, Think for Yourself: Restoring Common Sense in an Age of Experts and Artificial Intelligence and Boombustology: Spotting Financial Bubbles Before They Burst. Vikram lives in Lincoln, New Hampshire with his wife and two children, where they can usually be found hiking or skiing.