Starting off with a quote from Mish:
While the trigger may be a deadly shooting by police, I believe the cause is social-breakdown fueled by rising unemployment, loss of dignity, and a desperate realization that hope for a better future and for government to do something responsible about jobs and rising food prices is fruitless. (emphasis mine)
Several weeks ago I wrote a post about the riots in Vancouver indicating my belief that the riots we experienced immediately following the Stanley Cup Finals were a foreshadowing of something larger. Following that we had rioting in Greece, and now the most interesting (and I do NOT use that word lightly, or to downplay the severity and tragedy of the current riots) – rioting in London.
Why on earth would I choose the word “interesting” to describe riots? The reason is this: the rioting in London appears to be “without cause”. I like how Mish uses the word “trigger” and separates it from “cause”. You never know what catalyst (or Black Swan) will trigger an economic event, but I believe that Mish’s analysis is correct. The reason for these London riots is essentially a social breakdown: stripping people from their ability to pay bills and buy groceries by the ever-increasing amount of corporate greed, political stupidity and inflation. That’s not to say the consumer is not without fault. The human species is given over to greed – constantly overcome with the desire to consume, and the wrongful believe that we are somehow entitled to an ever-increasing standard of living at the expense of someone else (cheap labor in China, perhaps).
I’ve said this before, and others have said it before me, but what happens to the family that earns $10.00 per day when the cost of food to feed that family increases to $15 per day? The answer is civil unrest, the shedding of blood, and people who will do whatever it takes to keep their family alive.
What happens when credit cards have been maxed out, unemployment is 30% and that same scenario arrives in North America? What does that North America look like?