Chinese New Year of the Fire Horse -- Let's Look at 1966 and See What We Can Learn from History

 History may not repeat itself, but it certainly can rhyme!

The Fire Horse Disrupting the Disruptors!

1966 - The Last Chinese Year of the Fire Horse

Since this is Food for Thought — Imagine the Unimaginables for 2026 was coupled with the Chinese New Year of the Fire Horse, I thought it may be interesting to look back 60 years when the last Year of the Fire Horse occurred —1966! History may not repeat, but can certainly rhyme. The Year of the Fire Horse is one of expected high energy and significant change for the better and/or worse.

 So what happened in 1966 which may be relevant to some unimaginables in 2026?

Unimaginable #1: Europe Comes together !

• In 1966, Europe was in the throes of recovery, Germany esp. experiencing its “Wirtschaftswunder” or economic miracle that started in 1948 with the help of the US Marshall Plan. Italy was also a beneficiary. It seems there is nothing more beneficial than losing a war to the USA. In 1966, French President Charles de Gaulle withdrew France from NATO’s integrated military command forcing allied bases to move from French soil and relocating NATO headquarters to Belgium. France remained a political alliance member. Still the decision was noted as a feeling of distrust of the Americans on the part of de Gaulle and maybe a bit of ego. The Economist brings this up in an article called “That Irritating Feeling That France Was Right?”

• (Link:  https://economist.com/europe/2026/02/18/that-irritating-feeling-that-france-was-right?giftId=OGJjYWQ0MTctZmMxNy00YTY2LWEzYTAtNjAwZjQ0YjAyNzNk&utm_campaign=gifted_article)

• There is a growing feeling of distrust of America in Europe (not just France) today as a result of events, tweets and speeches throughout 2025 leading to an existential challenge, even survival since Russia’s invasion of Ukraine plus spurious drone attacks in the EU. France has taken their fight to Social Media as well which makes the power play even more interesting: French fight back on Social Media:   

• https://www.wsj.com/world/europe/french-response-foreign-ministry-x-account-trump-elon-musk-e7095fc1?st=HYo4BD&reflink=article_copyURL_share

• This has forced Europe to rethink war or The European Way of War (NY Times Feb. 24, https://www.nytimes.com/2026/02/23/world/europe-defense-us-ukraine-mexico-tariffs.html?smid=nytcore-ios-share). A certain advantage that Europe now has, especially the Germans is that the underinvestment in their militaries the last decades allows them to skip right into the advanced technical weapons like drones that are cheaper and perhaps more effective than classic weapons. In any case, lessons are being learned from witnessing the determination in the Ukraine with their limited resources.
• Who will assume leadership in Europe—the EU Parliament? Ms. von der Leyen? It was easier with US always assuming the lead. And are we discussing EU and/or NATO? The UK, Germany and France are the coalition of the Willing, but the UK exited the EU in 2016, Chrystia Freeland, former deputy prime minister of Canada  from 2019-2024, writes about the Great Capitulation, meaning Europe can no longer allow itself to be pushed around by the USA. After Carney’s speech in Davos and now this, perhaps Canada will assume the leadership role, unimaginable? The new leaders will define what people are willing to fight for, liberty, equality and justice. (Link: “The Great Capitulation Is Over. What will Take Its Place?” Feb. 25, 2026 by Chrystia Freeland -
• https://www.nytimes.com/2026/02/25/opinion/trump-europe-civil-society.html?campaign_id=39&emc=edit_ty_20260225&instance_id=171607&nl=opinion-today&regi_id=75316253&segment_id=215786&user_id=7464c69db002dd3ce450a92a5ce2adb4)
• Liberty, Equality and Justice will be also emphasized by the Democrats with the reminder that Americans going into the Mid-Terms cannot take it all for granted.  

  “The cost of liberty is less than the price of repression.” W.E.B. DuBois 

 Unimaginable #2): 1966 US Market Peaks -- The Nifty Fifty !                          

• The USA stock market in 1966 peaked after a post WWII bull run. A bit like the current market concentration called the Magnificent 7, but the Nifty 50 were the top 50 Blue Chip shares experiencing good growth and eventually becoming overvalued. This was not a bubble, but a peak. America was divided then, the Civil Rights Movement was gaining traction and because of the Viet Nam War, inflation started to climb in such a way that interest rates were going up. Sound familiar? 
• Ray Dalio of Bridgewater fame published an essay on LinkedIn featuring this chart: 

 The share of financial assets as a percentage of total assets has reached secularly high levels. 

 Source: Ray Dalio   Read full article  // Daily Shot Feb 26, 2026

• War, Division and Over-valuations—What is it good for? According to this chart—> Market Corrections! 
• It seems Tech together with mathematical models have a greater influence on economic growth and market behavior, Tinkering the economy with their models and algorithms maybe playing down too much the social science part of economic behavior. The economy has been treated like an engine. This was analyzed quite interestingly in an Odd-Lots Podcast interview with Jamee Moudud, a professor of economics at Sarah Lawrence College and author of the new book, “Legal and Political Foundations of Capitalism.” This phenomenon of Tech and Math playing a greater economic modeling role started pretty much in 1966—away from fundamentals and institutional theory turning the economy into an engine, mechanical and not so social. The European model of social market economy is perhaps the more sustainable one especially for democracy to prevail and may prove to be a source of strength.
• (Link: https://podcasts.apple.com/de/podcast/odd-lots/id1056200096?l=en-GB&i=1000750773868.)
• The 1966 US Stock Market had a lot in common in what we are experiencing today. The economy was strong, but overheating. Markets were fully valued and therefore vulnerable to policy tightening. Fiscal policy was expansionary coupled with a relatively restrictive monetary policy. 1966 marked the start of a long period of stagnation bottoming in 1982 -- volatile, range-bound equity markets in real terms. The oil crisis played a big role in the 70s and perhaps we will have to deal with  extraordinary global debt crisis this time around???

  Unimaginable #3 and #4): Consume or Not to Consume / Commodity Bubbles !

• As we all know, affordability is the main theme affecting consumption and the US Mid-Terms. Advertising and inspiration got started in the 50s and 60s, but with a K-shaped economy, it is essential that the middle class gets reviatalized — unimaginable? Instead of oil being the main driver as in the 60s, electricity will be the essential commodity of 2026 onwards. Bubbles reflect scarcity and hoarding. Aggresive military actions are changing the balance of power with a huge focus on territories especially where there's rich commodity resources. Oil is no longer scarce, and the war in Iran is illustrating rather the scarcity in gas and the continuous demand of scarce minerals as a means of reaching solutions in making electricity abundant.
• Making electricity affordable and abundant will depend a lot on technology and perhaps alternative energies. Some say the social problems we have today besides inequality, are health care, education, rejuvenating the middle class which can perhaps be solved using AI tools and modeling. We just have to feed it the right prompts!

Unimaginable #7 & #8): Life styles emphasize analog rather than digital ! 

• One with Nature and Social Interactions will be what's cool while money and showy wealth simply ostentatious. We get off our phones and look for Facts winning over Fake through in person and/or live discussions!
• Money and wealth take a back seat as the role of authenticity and esthetics take over. After 1966, hippy culture, civil rights and ecology and alternative life-styles  were simply cool. Too woke going into the mid-terms? This could reflect social and quality of life ssues re-entering economic models and influencing expectations.
• In the original Unimaginable from Feb. 4, in the appendix is a link to an article in the New Yorker proclaiming it is cool to have only a few followers!  Compare this to 'Poor is cool in the 70s': Limited followers on social media is the new cool: "It’s Cool to Have No Followers Now!" https://www.newyorker.com/culture/infinite-scroll/its-cool-to-have-no-followers-now.  The same thing may start affect music streamers where the artists esp. Indy musicians (cool?) are finding new ways to directly reach their audience and create their own followings.
• Here is a link to a substack, The Artist Economy:  

  https://joelgouveia.substack.com/p/the-death-of-spotify-why-streaming?utm_source=multiple-personal-recommendations-email&utm_medium=email&triedRedirect=true

“We are witnessing the death of the “Mass Audience” and the birth of the “Micro-Community.”

The music industry has spent a decade obsessing over how to get a million people to listen to a song once. The next decade will be defined by artists figuring out how to get 1,000 people to care forever.”

Unimaginable #9): What about China? Victory for Ukraine?

• Guess what happened in 1966 in China! The Cultural Revolution was initiated and lasted 10 years! A disaster and at a time when Chairman Mao was desperate to maintain his authoritarian control. Because it failed, China was then set up for its Economic Miracle which we continue to witness today. China is now in an awkward situation with the war in Iran where they get their oil and actually putting Ukraine in a more favorable situation as Iran was chief supplier to Russia for their drones. America and Russia can provide oil, maybe as a quid pro quo vs. rare earth minerals. I am pretty sure current developments in Iran and the consequences were/are quite unimaginable. How will this be played out? Will Operation Epic Fury be Trump 2.0's Cultural Revolution moment? Do we have to look to predictions markets, rely on our intuitive instincts. Stay tuned!

 Changes are abundant and fast in 2026 — Disrupting the Disruptors will keep us on our toes. Food for Thought! Imagine the Unimaginables!