No Deal: Socionomics Shifts Odds

Socionomic theory provides a macro background that helps adjust the probability of any outcome. Drilling down into micro events requires more analysis. For example, assuming the higher order trend is towards negative mood, I make long-term projections about rising nationalism, anti-immigration, increased likelihood of international conflict and breakdown in international organizations. Politically, this might tend to favor right-wing and nationalists parties, but if a globalist right-wing party holds power (such as in Spain or Germany), then the left-wing stands a good chance of taking power. Or in Italy, the coalition government might be described as left-wing nationalist. However, this only tilts the odds. On the topic of secession, countries with existing independence movements or a history of secession are more likely to split during periods of negative mood.

When it comes to smaller organizations and events, it's much more difficult to make a call. On average, we should see more infighting.

CNBC: OPEC meeting 'might be one of the worst since 2011' amid differences over supply

"It might be one of the worst OPEC meetings since 2011," Eugen Weinberg told CNBC's "Squawk Box Europe," explaining that the differences in opinion over production could cause problems.

An OPEC meeting in 2011 was marked by infighting between members and disagreements over whether to tackle high oil prices (then around $118 a barrel) by increasing production. Gulf states wanted to increase supply to ease prices but were outnumbered by other OPEC members, including Iran and Venezuela, that wanted to maintain supply levels. At the time, Saudi Arabia described the summit as "one of the worst meetings we have ever had."

Over the past 9 years, the two periods with significant declines in social mood (judging by the drop global markets) was 2011 and late 2015/early 2016.

Inc: UPS Strike Could Disrupt Business Across U.S.

UPS could soon face the largest labor stoppage the U.S. has seen in decades. More than 90 percent of the shipping company's union members voted in favor of going on strike if a deal is not reached before the current labor contract expires on August 1, according to CNN.

...Labor and management still have time to reach a deal, and a UPS spokesperson has said that the two sides have reached agreements on a wide range of other issues. The last time UPS experienced a strike, in 1997, 180,000 workers walked out for 16 days.

The odds of a strike are higher now than in 1997, when social mood was approaching a peak.

Meanwhile, the clash of new and old is underway in international politics. U.S. hegemony was always going to wane and the United States will begin behaving more like other nation states. The U.S. is less likely to sacrifice blood and treasure in pursuit of global hegemony and alliances. This process will proceed in fits and starts.

ZH: "The Old Order Is Over": Trump To Adopt "Confrontational Tone" At G-7 As Macron Plans On "Standing Up" To US President

Ahead of what is shaping up as the most confrontational G-7 meeting in history (the first meeting took place in 1975), we reported that Germany chancellor Angela Merkel already was setting the ground for the Toronto showdown among the world's top political leaders - where Trump will also be present - vowing to challenge Donald Trump on virtually every issue, from trade to climate, and warning that the lack of room for compromise means leaders may fail to agree on a final statement, an unprecedented event at a summit of the world's 7 most advanced nations.

Speaking before German lawmakers on Wednesday, two days before the G-7 summit starts in Canada, Merkel said that Trump’s "America First" doctrine shows that “we have a serious problem with multilateral agreements." She added that failure to reach common ground could lead to the highly unusual step of host Canada issuing a concluding statement not agreed by all participants, according to Bloomberg.

Merkel said she plans to speak to Trump specifically about trade at the G-7. “There will be some controversial discussions” at the gathering, she told lawmakers. Germany will make sure that what was agreed on trade and climate at the last G-7 summit and at a G-20 meeting will be maintained in joint statements from the two-day meeting in Quebec "if any are agreed."

Commenting on Merkel's warning yesterday, we said that "we doubt Trump will be too "burned" by that statement."

And according to overnight newsflow, that is indeed the case and that if Merkel was hoping to "soften" Trump up by warning about the upcoming showdown between the US and the rest of the world, she made a mistake, because wires report that President Trump is said to be planning on adopting a confrontational tone at G7 in response to the other 6 nations collectively pressuring him regarding tariffs.

Trump is far more confrontational than prior presidents and Obama perhaps the biggest pushover, which masks the general trend shift.

White House economic adviser Larry Kudlow tried to play down the tension on Wednesday, describing it a “family quarrel" and telling reporters that “Trump is trying to fix this broken system,” adding that "He’s sticking to his guns. He’s going to talk to them. The lines are open."

Good luck: "The meeting this week will be by far the most dysfunctional G-7,” said Ian Bremmer, president of the Eurasia Group, a political-risk consulting firm. "The old order is over. What we are fighting over now, as the new order emerges, is whether the U.S. wants to have the most important seat at the table or not. Right now the answer is no."

Actually it's Ian Bremmer won't have a seat, something to keep in mind when reading the gloom and doom analysis. Speaking of which, some in the U.K. are claiming the European Union will unleash a Cold War with Britain if it chooses a hard Brexit.

ZH: What The "Doomsday Brexit Plan" Document Says Should Frighten Us All

“Britain would be hit with shortages of medicine, fuel and food within a fortnight if the UK tries to leave the European Union without a deal, according to a Doomsday Brexit scenario drawn up by senior civil servants for David Davis.”

The Times confirms that the port of Dover will collapse “on day one” if Britain crashes out of the EU, leading to critical shortages of supplies. This was the middle of three scenarios put forward by senior advisors. A type of best guestimate if you like. You simply do not want to know the outcome of the worst of those three scenarios. Indeed, we have been spared from such details.

The article states that the RAF would have to be deployed to ferry supplies around Britain. And yes, we’re still on the middle scenario here. “You would have to medevac medicine into Britain, and at the end of week two we would be running out of petrol as well,” a contributing source said.

The report continues to describe matters such as cross-channel disruption for heavy goods vehicles, which would also be catastrophic. Massive carparks will be required.

A U.S. invasion of Germany with the help of Polish forces is about as likely as that doomsday scenario. But it speaks to the real changes underway and how much the establishment fears losing control over international and domestic affairs. Social mood is turning negative and infighting will only increase moving forward. The stakes will rise as out-of-power elites make a grab for control, as described by Turchin's "elite overproduction" model.