Putin’s war is trashing 80 years of globalization

This is Bloomberg Opinion Today, an Upside Down of Bloomberg Opinion’s opinions. Sign up here.Today’s Agenda RIP the New World Order. Maybe [Bloomberg]( Follow Us [Get the newsletter]( This is Bloomberg Opinion Today, an Upside Down of Bloomberg Opinion’s opinions. [Sign up here](. Today’s Agenda - RIP the [New World Order](. - Maybe [recession isn’t inevitable](. - Commodities traders [don’t need bailouts](. - [Permanent daylight savings time]( is a bad idea. Meet the New New World Order, Same as the Old New World Order You might hope all this stagflation and war-in-Europe stuff is just a nightmarish interlude before we get back to the globalization and low, low prices we enjoyed as recently as 2019. But Liam Denning warns Russia’s war is [blowing a lasting hole in the world order]( that fostered (kinda-sorta) peace and (unequal) prosperity even in the Cold War. Between the Covid pandemic and Putin’s zeal for committing war crimes and terrorizing Europe, nations are scrambling back into old corners and rebuilding old walls. Even Germany is re-arming, [shaking off an 80-year fantasy]( in which it thought it could atone for its sins by floating above history, writes Andreas Kluth. The West still seems to hope China will come to its senses and preserve a system that served it so well for so long. Xi Jinping apparently told President Joe Biden he [didn’t want]( war in Ukraine. Maybe he even [meant]( it. Italian luxury brands have decided [they can easily abandon Russia]( because Chinese consumers will always be available, Rachel Sanderson writes. Maybe they will. But India and other developing countries that need Russian commodities to survive could [end up in Putin’s camp]( simply because the West has once again ignored their needs, warns Mihir Sharma. Crypto is making it easier than ever for bad actors, at-risk people and maybe even whole countries to [check out of the global financial system]( the dollar dominates, writes Andy Mukherjee. This will create all kinds of new headaches for policy makers. If only we’d known in 2019 that those were the good old days. Bonus Global Cooperation Reading: We’ll need to [keep Russia involved in fighting climate change]( and pollution in the Arctic. — Adam Minter Don’t Fear the Yield Curve The Netflix nostalgiaganza “Stranger Things,” which features a parallel universe called The Upside Down, last had a new season in 2019. That also happens to be the last time people were [freaked]( out about the Treasury yield curve being upside down. “Stranger Things” is coming back in 2022. We’re freaked out about the yield curve again. Coincidence? Perhaps. For the uninitiated, an “inverted yield curve” is not a rare medical condition but that perverse state when short-term interest rates are higher than long-term ones. Think dogs and cats living together, real wrath of God type stuff. An inversion of 2- and 10-year Treasury yields almost always precedes a recession. (I say “almost” because that curve did dip a pinky toe into inversion territory back in 2019 without a recession happening organically — although Covid caused a recession seven months later anyway, so, shrug.) Anyway, here’s how the curve looks now: Uh, yikes? Except Bob Burgess points out this is [the amateur-hour yield curve]( when it comes to predicting recessions. The curve the pros watch is between three-month and 10-year Treasuries, and that is [strong like bull](: Bob lays out a bunch of reasons for us not to expect a recession, in spite of the meteor shower of badness barraging the economy, from gas prices to Vladimir Putin. It is shielded by a strong job market, a whole bunch of stimulus cash still in consumers’ pockets and a Himalayan-sized mountain of home equity. Some of that economic fuel is also stoking the worst inflation we’ve seen in decades. The Fed is raising interest rates to deal with that, but Ramesh Ponnuru writes it must be [careful to address only the demand side of inflation](. Much of our current inflationary nightmare is coming from the supply side — the sudden disappearance of Russia’s oil, for example — and the Fed could make matters worse trying to fight that inflation, Ramesh writes. Getting this right feels a little bit like trying to separate the yolk from a half-scrambled egg, but it could determine whether we actually do fall into The Upside Down. No pressure. Telltale Charts Commodity traders [raked in record profits during the pandemic](, and now they want government bailouts as their markets [melt down](, Javier Blas writes. Maybe they should tap some of that cash they made first. Further Reading Permanent [daylight saving time failed once already](. — Bloomberg’s editorial board Biden’s [new Covid czar has the communication skills]( he needs. — Jonathan Bernstein America’s new cutting-edge medical research agency, [ARPA-H, needs freedom]( to be effective. — Lisa Jarvis How one family [led Sri Lanka to financial ruin](. — Ruth Pollard ICYMI Some [Russian bondholders got paid in dollars](. [California has cash](, and Wall Street wants it. Arnold [Schwarzenegger made a video for Russians](. Kickers The biggest Aztec temple was [decorated with more than 100 starfish](. (h/t Scott Kominers) After 400 years, [beavers are back in London](. This could be just [the start of human history](. Vulture’s [TV shows](, [books]( and [albums]( to catch this spring. Notes: Please send starfish and complaints to Mark Gongloff at mgongloff1@bloomberg.net. 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