What kind of economic world do we live in?
It is interconnected, not only in the sharing of information, but also in the relationships among financial markets.
The movement of money between the world's currencies has been amazing. And the dollar, being the premier store of value currency, is at the center of everything.
Consider what has been happening since the U.S. presidential election.
The U.S. dollar has risen substantially against the euro. It has also risen against the pound, extending the gains that occurred after the British voted to leave the European Union.
Since election day, the dollar has risen against the yen and further extended gains against China's yuan. Currencies from emerging-market nations have also declined in value during this period.
And, if the Federal Reserve raises its short-term interest rate target at its December meeting, this will only further strengthen the the dollar. Furthermore, it is expected that the Fed will raise rates again next year, maybe more than once.
The U.S. is economically so connected with others that there now a question as to how the incoming government will conduct monetary and fiscal policy, given its protectionist leanings.
With this amount of connectivity, it is hard to see how politicians in the U.S. could conceive of withdrawing from the world.
Yet that is just what the U.S. seems to be doing.
President-elect Donald Trump has campaigned upon the idea that the Trans-Pacific Partnership, or, TPP, would be a "disaster." Trump also has indicated that he would like to do away with the North American Free Trade Agreement, NAFTA, and provide other forms of protection to shelter American industry.
People are beginning to realize that it the U.S. shrinks away from these trade deals it will be holding the door open for the Chinese to move into the vacuum and take charge of world world economic affairs.