Thursday night, I set off from Asti to Turin, where I’d take the short flight down to Naples.

Four months ago, Aussie Trav, Irish Jerry, and I agreed to meet in Italy to make it easier for me to show up. Regrettably, I had missed our last two attempts at a lads’ weekend due to family stuff.

So I write with a heavy head this morning, as there was more than enough wine, beer, and limoncello to go around this weekend. And my hotel bed was so soft I barely slept more than three hours at a time.

Trav, Jerry, and I embarked on our journey at London Business School in September 2000, a time when the world was simpler. We navigated the complexities of our studies and the evolving global landscape, finally graduating in July 2002. Our shared experiences and the bonds we formed during those years are a testament to our enduring friendship.

We talked about many of those complications this weekend, from war in Ukraine and Israel to an incredibly indebted United States government.

Those situations and more seem like an inexhaustible mountain of problems crying out to be solved. And then I looked up and saw The Mountain.

The Mountain

Credit: Sean Ring

As we sat high above the harbor, overlooking the fabulous Gulf of Naples, we took in a breathtaking view of Mount Vesuvius. While I was sipping on my Aperol spritz, I was thinking, “How do people live with this?”

Reader, when I say, “It’s right there,” I mean it’s right there.

If this volcano’s west face collapsed, there would be no more Naples.

In the famous AD 79 eruption that buried Pompeii and Herculaneum, Neapolis (“New City,” as Naples was then called) was only spared because the south side of the mountain collapsed, and most of the ash and pyroclastic flows went that way.

What’s much less known is that there was a terrible eruption in AD 60. The eruption caused notable destruction and was followed by a series of seismic activities and minor eruptions leading up to the catastrophic event in AD 79. In essence, it took nearly twenty years of smaller seismic events to build up to the main event.

Is that what’s happening to us now?

Current Events

Was the 2008 Financial Crisis the pivotal event or merely a precursor to what might be looming on the horizon? This is the question that keeps me up at night.

Since 2009, we’ve experienced the following events:

1. The European Sovereign Debt Crisis (2010-2015): This crisis was characterized by the inability of some European countries to repay their government debt due to the aftermath of the 2008 financial crisis. The affected countries included Greece, Ireland, Portugal, and Spain.

2. The Chinese Stock Market Crash (2015): In June 2015, the Chinese stock market sharply declined, resulting in significant losses and triggering concerns about the health of the Chinese economy.

3. The 2019-2020 Global Economic Slowdown: Several factors cause this slowdown, including trade tensions between the United States and China, geopolitical risks, and the COVID-19 pandemic. The pandemic, in particular, led to a global recession, with many countries experiencing negative economic growth.

4. The 2020 Oil Price War: A price war between Saudi Arabia and Russia led to a significant drop in oil prices, causing financial stress for oil-producing countries and companies. This event also contributed to the 2019-2020 global economic slowdown.

5. The Evergrande Debt Crisis (2021): Chinese real estate developer Evergrande faced a debt crisis, with concerns about its ability to repay its debt. This crisis raised concerns about the stability of the Chinese property market and the potential impact on the global economy.

Notice something?

The United States only drove one of these crises directly.

But politically, things have become more complicated, not less.

The US is trying to find its way out of Ukraine while keeping face. It’s trying to get Israel to back off the Palestinians and Iran to back off Israel. And we hope the US isn’t trying to start something over Taiwan.

And yet, Biden keeps tripping over his own feet. To wit, from Intellinews (bolds mine):

The London Metal Exchange (LME) and Chicago Mercantile Exchange (CME) have blocked the trade of aluminum, copper, and nickel produced by Russia, the UK government accounced late on April 12.

The move will drive Russia deeper into China’s embrace as Shanghai is now the only major commodity exchange that is still accepting and trading Russian metal.

To mitigate the risk of market instability, the government said that the new measures would exempt existing stocks of Russian metal on the two exchanges. These stocks can still be traded and withdrawn without restrictions, providing continuity for market participants. The UK ban is not expected to affect prices in the short-term as there are large stocks of Russian metal in the LME warehouses.

This move, part of existing bans, aims to intensify restrictions on prohibited Russian metal exports, thereby curtailing a 'crucial source of revenue for the Kremlin,” the UK said.

The key Russian metals of titanium or platinum group metals were excluded from the ban as Russia remains a major supplier of both of the hard-to-find metals.

You simply cannot fight inflation with metal bans. All three of those crucial metals will get more expensive.

And with this, the stock market has gotten wobbly.

Friday was a rough day:

During the session, investors drove gold, silver, and copper to new highs before violently selling off.

Jared Dillian, author of The Daily Dirtnap, posted this on Friday:

Credit: @dailydirtnap

I’m hanging onto my gold, silver, and copper miners, that’s for sure.

Wrap Up

As the sun set Saturday night over Naples, Vesuvius faded to black, and the city came alive with its lights. It was a gorgeous scene, with excellent company and fine wine.

But Vesuvius was still there, lurking in the distance. And yet, the sun rose on Sunday, and life continued.

Since I was in Naples, I did as the Napolitans do: I ate pizza for breakfast.