The following is part one of a fictional story in the similar vein to my prior work, The Day the Dollar Died.
Let us all hope this remains fiction and not become a reality in the near future.
October 24, 2022 3:34 p.m. ET –
Turbulence was the catch word of the month and with less than a half hour until the market close a sudden wave of sell programs took a slightly down Dow at 30,335 to 29,580 in less than 3 minutes. The commentators on financial television were all tying this move directly to rumors of an impending Chinese action against Taiwan but news from the region was sparse this particular Monday afternoon.
The first shock came on the previous Friday when Beijing expelled the US Ambassador, Nicholas Burns, which caused a five hundred point decline in the market. Yet things seemed to settle down over the weekend as the Biden administration indicated that the expulsion was due to a personal dispute and nothing to do with the recent delivery of arms to Taipei last week.
As the market decline accelerated to a full 1,000 point move down by 3:45 p.m., the rumors swirled louder when an unconfirmed Tweet from a verified user claimed that all US military leaves were cancelled earlier in the day and USAF reservists were being called to immediate active duty.
October 24, 2022 3:55 p.m. ET –
The headline hit the television screens of all the major networks with frightening speed:
“The People’s Republic of China has announced an aerial and naval blockade of the province of Taiwan effective at 4 a.m. local time. No aircraft will be permitted to fly over the island nor any marine vessel permitted access to the island without permission or escort of the People’s Liberation Navy.”
The stunned look on the face of the anchors upon posting that graphic was followed with stunned silence as the Dow Jones Industrial Average plunged over 3,000 points. The US Dollar soared above 120 on the US Dollar index causing even more panic as the markets were about to close. This was followed by bids into WTI Crude which shot up past $125 per barrel and gold moving up $150 in less than 30 minutes.
As the market began to close a final headline crossed with thirty seconds left in trading:
“President Biden to address the nation at 8 p.m. Eastern Time and this speech will be carried on all television, cable, and radio broadcasters without exception.”
That was good for another sudden surge down as the markets closed at 26,240 on extremely heavy volume down almost 13.5%.
October 24, 2022 4:37 p.m. ET –
The Chinese ambassador to the United States issued a statement bristling at the suggestion it was a “blockade” as reported by the US media. The Beijing government stated that them term “economic preservation zone” would be a more accurate reflection of the actions taken, but the reality was that the earlier rumors appeared to have some voracity. To add to the concerns of the American public, Beijing announced that Ambassador was already flying back to China for “consultations” with the Chinese Communist government.
It wasn’t long after the shock hit the markets of this story breaking that a sudden flurry of internet sourced stories began to appear:
– Camp Pendleton and the US Marine based at Twenty-Nine Palms were locked down with access only to servicemen and their dependents living on base.
– All US Air Force units were put on an immediate heightened readiness status with all reservists called to active duty.
– Pictures from Guam showing the opening of Civil Defense shelters and all military bases being locked down at a higher alert status.
– The USS Ronald Reagan rapidly departed Yokohama, Japan with its task force to join up with the USS Tripoli near the South China Sea. Reports also indicated that the USS George W Bush carrier group was heading to the Suez Canal to transit and move full steam ahead to the Pacific region.
Then came the shocking news on top of an already tumultuous day for the markets:
The Federal Reserve and US Treasury were in a virtual emergency meeting to reportedly discuss an “international situation” as of 4:15 p.m. Eastern time. No information was available as to what subjects nor details were disclosed.
The futures were already lock limit down and this news just guaranteed that there would be little chance of the markets opening in a normal fashion the next morning.
October 24, 2022 5:07 p.m. ET –
By this time the videos posted on social media would shock everyone and eventually caused the cable news networks to send their own camera crews out to verify the stories.
Lines of over one hundred people at ATMs all over the US. In California, there were lines into the banks which were still open and at ATMs in the banks and grocery stores. Videos and pictures of panic buying at Costco, WalMarts, and grocery stores flooded the national news networks and social media as rumors of a world war began to spread across America. The messaging from the networks and politicians only made it worse as gas stations across the country were overwhelmed with people trying to hoard gasoline.
With the markets in turmoil, the financial system overwhelmed, and the American people terrified, the question being asked by the television commentators failed to sooth the concerns of the public. The White House was locked down tight with no rumors, no hints, and no information as to what the President would say tonight.
Will President Biden give a speech to soothe the nation’s fears or stoke the fires of war?
America was about to find out soon enough.