Blain’s Morning Porridge August 25th, 2026“Financial Gravity is shifting East – as will investment.”One rule of finance is “follow the money”. The ructions and rising doubts on the sustainability of the US Treasury Market and dollar in the evolving post-US era economy means it may be time for investment transition strategies – where will the future lie? What aspects of US and other Western Democracies will thrive, and how much more investible will China and, perhaps, India become? What are the risks?Key Takeaways:The West is no longer the only game in town. Concerns over the sustainability of Western debt, economic growth, political stability, America First transactionalism, and “financialisation” have eroded confidence.The unravelling of NATO and western division has accelerated decline – the West is no longer a cohesive economic block – and is less economically and militarily formidable than it was.China’s economy has evolved swiftly and leaves the state command and control economy look like a viable alternative to the West.China is not self-sufficient. There are still areas the West can maintain comparative advantage to trade from. The West is still “richer” in GDP capita terms.Europe faces a choice – pragmatic reciprocal engagement with China may be better than trying to deal with unstable populist politics in the USA. But that will further strengthen China’s strategic aim of splitting the Western Democracies.Longer-term, India’s demographics may prove a second option for Europe – both seek growth and markets. Perhaps a new European/Indian trade alliance could become a new trading block?Headlines on the front page of the Thunderer of London this morning is the news the Rausing family - billionaire inventors of the tetra Pak – have taken $1 bln out the US stock market.You can read the Morning Porridge by subscribing on ⁠www.morningporridge.com⁠, and have it delivered fresh to your inbox every morning!

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