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This article is more like anti-trump rather than promoting yuan, just look at swift proportion
World reserve currency status follows the leader in manufacturing and trade. Maintaining dollar hegemony was never going to be feasible after de-industrialization, but short-sighted decisions like weaponizing SWIFT have accelerated its decline. As the dollar is gradually shunted out of world trade, the US will be less able to export its inflation abroad. The implications won’t be pretty.
The only way out is to actually start creating and exporting something else besides war, weapons or weapon backed 'IP', or 'credentials' (degrees).
The credibility of the credentials has gone down the toilet.
To get the world to actually buy real stuff from you, you have to produce goods they actually want.
Not sure the US is actually ready to re-uptake 'manufacturing' of products at a quality and price point the rest of the world sees as good value.
World reserve currency status follows the leader in manufacturing and trade. Maintaining dollar hegemony was never going to be feasible after de-industrialization, but short-sighted decisions like weaponizing SWIFT have accelerated its decline. As the dollar is gradually shunted out of world trade, the US will be less able to export its inflation abroad. The implications won’t be pretty.
Meanwhile PRC not entertaining being reserve because eating Triffin shit / be global lender of last resort retarded. What PRC does offer is selling entire tech stack to get 90% modern at 30% cost. At least PRC fine for short/medium term if investors run to US to watch line go up (at the expense of US debt -> domestic drama), while industry runs to PRC to for material goods that keep their country running. It's a degree first/second order leverage (indispensable tech/industry to supply indispensable tech) that builds reserve currencies, having goods no one else has, in PRC case, having goods at affordable prices no one else can match, and in many ways bypass downsides of Triffin, as long as PRC can convince enough countries to settle in RMB for transactions relevant to PRC interest.
Earlier quoted context omitted.
> People would trust China for the same reason I don't necessarily disagree, but can you explain why you think it is, that people keep trusting powerful states which keep giving plenty of reasons to not be trusted?
Because money is the priority for those people. If they can make more money by operating in a different regime then they will, the moral or political stance of that regime isn’t really relevant
But we're talking about what you can trust a government to do here. It matters even if you're indifferent to morality or politics. It's very much relevant to making money, too.
Earlier quoted context omitted.
Getting investments isn’t the same as adopting a currency as a reserve for its stability.
The US dollar lost ~10% of its value this year. It is expected to lose another 10%. Which stability are we talking about? Also, here you can see the change in the foreign exchange reserves by currency: https://en.macromicro.me/charts/116488/global-official-forei... US Dollars: 71% -> 58% Chinese Yuan: 0 -> 2%
China is an empire. It cannot survive except through expansion so betting it will expand is like betting a person will breathe tomorrow.
Accepting Chinese currency is like France buying Nazi bonds in 1939 (which France and most European countries did, btw). It seems like, in fact it is, the height of stupidity, but it's amazing what a little bit of promised money can make people do.
This is figuratively, and potentially literally, paying for the bullets that will end up lodged in your skull, because the shooter promises 10% return. Which of course, these states will gladly do.
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"It’s a totalitarian state who has been jailing its wealthiest businesspeople on a whim, causing many to flee, and it’s about to embark on an invasion of its peaceful neighbor." To be fair and very frank: the USA does the same things Peaceful neighbor: greenland or mexico (sure the cartel related violence but it isn't per se state.) Jack MA is the famous chinesse example, but it was close enough for bill gates, howar…
How was Zuckerberg close to being in jail or abducted by the state please explain
https://www.politico.com/news/2024/08/28/trump-zuckerberg-el...
"Former President Donald Trump writes in a new book set to be published next week that Mark Zuckerberg plotted against him during the 2020 election and said the Meta chief executive would “spend the rest of his life in prison” if he did it again."
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Because money is the priority for those people. If they can make more money by operating in a different regime then they will, the moral or political stance of that regime isn’t really relevant
I feel like you're maybe dismissing "moral or political stance" as something almost aesthetic here, some like this, some like that. But we're talking about what you can trust a government to do here. It matters even if you're indifferent to morality or politics. It's very much relevant to making money, too.
Earlier quoted context omitted.
The US dollar lost ~10% of its value this year. It is expected to lose another 10%. Which stability are we talking about? Also, here you can see the change in the foreign exchange reserves by currency: https://en.macromicro.me/charts/116488/global-official-forei... US Dollars: 71% -> 58% Chinese Yuan: 0 -> 2%
As opposed to China, who will probably invade pretty much every Asian country, and the only big unknown is the order. Western China is annexed. Nepal is Annexed. Hong Kong is annexed. Mongolia is 100% under Chinese control. Northwest Pakistan is 95% under Chinese control. Parts of Russia, Afghanistan, Tajikistan and other countries are under Chinese control to a greater or lesser extent, and all those countries have…
Illuminating article. And if the yuan bonds information is real, it won't even take 4 years for a lot of global finance to move away from the dollar. It might be tough for the US to accept the higher cost of global resources (and thus become a poorer country) but maybe this gradual decline in dollars status is what the administration hopes is the best case.
Move to what exactly?