Posted on 11/05/2022 9:06:47 PM PDT by SeekAndFind
Let me be super real here, if China keeps developing under the current dollar dominated system and do nothing. It will probably plateau at Poland level of GDP per capita of around $15,000 nominal per capita. scary isn’t it? spoiler alert, China has already begun changing the system since 2012.
It doesn’t matter how fast can a country make good quality desirable product. As long as your country’s currency reserve is pegged to your US dollar reserve, then you cannot surpass the US economy in size. This is a hard ceiling no country can break when you live under the yoke of the American dollar hegemony.
The Above are various economies as a percentage of the 100% US economy. EU, despite its competitive products and larger population, only stabilizes around 80% of the US economy.
The blue is USA’ GDP per capita, with the 100% flattline. The rest are different economies shown as a percentage of the US economy GDP per capita. Keep in mind this is a logarithmic scale. Red is Japan, Green South Korea, Purple is China, teal is Vietnam.
Why is that? is it because Americans are so smart and much better workers?
NO, it’s because all other countries sells products and services, while the Americans sells US dollars. So you can’t sustain infinite linear economic growth when your central bank can’t print US dollar.
In order for China to break the US dollar ceiling, China MUST appreciate their currency, make sure RMB issuance and reserve is not pegged to China’s US dollar reserve, increase the use of sovereign debt denominated in RMB and other means as substitute.
China luckily has already started doing this since 2012. Thanks to Xi Jinping, now you know why some in the West hates him so much.
For more reasons why the West hates Xi Jinping, refer to the Ecological Civilization growth strategy proposed by Xi Jinping:
This also means that China must become a largely Importing nation, and trade must be mostly done using RMB. This is where the Belt and Road initiative comes in.
Besides the Belt and Road initiative, a new economic strategy proposed by Xi jinping administration, is the Dual Circulation economy, this sets China up as a consumption driven economy, that would prioritize import and consumption while internationalizing the RMB.
It is this set of monetary, economic and geopolitical strategies that will see China break the US dollar hegemony, and become a moderately developed society by 2035.
Once a hole is punctured and China breaths the free air above the American hegemonic ceiling. The rest of the world would want to follow, only then can the world break free from the bondage of America.
So China surpassing the United States is far from just coasting along the current model and expect China to surpass the US automatically, there are many policy and structural changes China needs implement for it to happen.
WIth the dollar hegemony gone, the days of Americans getting free lunch by exporting their inflation to the rest of the world is over.
With no free lunch, the American military hegemony, scientific hegemony and cultural hegemony will also crumble one by one. This is the long term goal. might not be fully realized until the middle of this century.
Chinese RMB breaking the dollar hegemony doesn’t mean the US dollar is suddenly useless, it’ll still be one of the most important currency. It’s just that the power would be shared more evenly between US dollar, Chinese RMB and Euro.
China represents 20% of humanity, If the dollar hegemony is kept, then that means 20% of humanity cannot surpass 4% of humanity who are Americans, the problem with the current system is that 4% of Americans are enjoying resources way above their share.
China doesn’t want to seem too developed or they won’t be able to freely pollute as much as they do
China is a first world country hiding within a third world country. If you have 300 million first world citizens you can’t call yourself third world even if you have 900 million third world. They are third world because you let them be. You need no help. You need resolve to do the right thing. Take care of your own. You are the second largest economy in the world.
Mitch McConnell is in the process of shipping what’s left of MAGA back to China. That should help.
China will experience a population crash unseen in human history since the Black Death in the next fifty years - how does it maintain let alone improve its lot after that?
RE: China will experience a population crash unseen in human history since the Black Death in the next fifty years
OK, I understand that this was because of their foolishly imposed the 1 child policy for the past 2 generations.
But now, China has a 3 child per family policy ( since 2021 ).
See here:
https://www.bbc.com/news/world-asia-china-57303592
Will this not be enough to reverse the population crash?
China will have have the population in another 40 years, and it is utterly dependent on oil, principally from the Mideast, for its economy to function. That oil can be cut off by any nation between the Persian Gulf and Taiwan that has a couple of destroyers and is pushed off at the arrogant and expansionist Chinese. Oh, and they’re entirely dependent upon exports, as the have a very anemic domestic market (not the least of the reasons for which is their rapidly aging population).
They had their moment in the Sun, but they’ll never dominate the globe. That they can break a lot of things and kill a lot of people is beyond question, but it is the ability to create increasing wealth over time that makes for power.
“China will have have the population in another 40 years….”
—————
…half the population….
China is the industrial colossus of the world, as you can see by visiting Walmart.
With an economy AND apartment blocks made of papier mache’?
With the second coming of Mao Tse Tung as fearless leader?
With an industrial base that can be brought to a grinding halt everytime someone sneezes?
Nope.
CC
Sure, eventually, although it’s a lot easier to reduce population than increase it.
And let’s not forget Xi’s little maneuver last week - the markets certainly didn’t.
“But now, China has a 3 child per family policy ( since 2021 ).
See here:
https://www.bbc.com/news/world-asia-china-57303592
Will this not be enough to reverse the population crash?”
————
No. There are, after over a generation of the one-child policy, simply not enough people of age (or coming of age soon) to have enough kids to reverse the crash. Add to that increasing prosperity in an increasingly urban nation, which ALWAYS leads to fewer kids per couple no matter what limits there are on having kids (or no limits at all).
“China is the industrial colossus of the world, as you can see by visiting Walmart.”
——————
Until they start up with Taiwan and get sanctioned like Russia is now - then they will become an ex-collossus in a few months.
That, or until India or Australia or Japan , or any nation with 2 destroyers, gets sufficiently ticked off at them to threaten to sink China-bound supertankers in the Indian Ocean or any of the straits that those tankers must pass through on their very long journey to China. They import 80% of their oil, and about 80% of that originates in the Persian Gulf. China’s prosperity is dependent upon the system that this country built after WW2, in which we enforced trade routes and encouraged massive specialization that would otherwise have been impossible. Once we withdraw a bit from the world, let alone actively deny its use to China, that system - and China’s prosperity - will cease to exist.
“Until they start up with Taiwan and get sanctioned like Russia is now - then they will become an ex-collossus in a few months.”
What planet you living on?
You mean the sanctions that Russia had been preparing for?
The same sanctions that China is likewise preparing for in advance of any move on Taiwan?
You mean the sanctions on Russia that have utterly backfired on the US/WEST/UK/EU?
You mean the same sanctions that will more than likely backfire on the US/WEST/UK/EU?
Why did you post Chicom propaganda?
In essence, like all modern currencies, the dollar is based on the backing and thus the strength and integrity of the country that issues it. And no country -- and especially not China -- comes close to the unique combination of factors possessed by the United States and its dollar.
These are: (1) economic size and dynamism; (2) military strength; (3) a network of supportive allies and consensus based organizations and international institutions; (4) cultural attractiveness; and (5) free markets, transparency, and the rule of law.
The importance of the first two factors is mostly obvious, but it is the last three that are utterly beyond China. In essence, most of the world likes being allied with or at least economically aligned with America because the US and Americans treat other countries and people well, which leads them to (mostly) like America and Americans. That is simply not true of China or the Chinese, which regard other countries and peoples in an imperial manner.
Align with America and adopt the dollar as your trade and reserve currency and you get more of America and Americans, which means blue jeans, rock music, a torrent of entertaining TV shows and movies, and greater military and economic security and prosperity. Align with China and you get more of China and Chinese, which means that you and your country get comprehensively disrespected, bullied, and exploited. That is why China's Great Silk Road project is faltering. It is a recipe for screwing other countries through predatory lending and one sided agreements.
And no one in their right mind trusts and expects China to honor their treaties and commercial agreements, have free markets, and keep honest and open economic and financial accounting that lets China's economic performance and the value of China's currency be properly evaluated. All of that is beyond China due to the nature of their culture and political system.
Don not take my word for this but read up and make your own evaluation. Most of all, look at the Chinese people. From poor to wealthy, they want American goods and culture, a cache of dollars in savings, and foreign residence and citizenship -- in America if at all possible. And unless America falls permanently into the clutches of Leftists, that is not going to change. Freedom, baby, is the most potent force on the planet. America did not invent it and does not control it, but we have the world's greatest supply of it.
No….China will have less than 500M by 2100….this will not be pretty.
With over 600 million people still living on utter poverty and a crashing economy - due to the real estate problems that make over 30% of the economy, Xi Jinping may as well declare any date because it still in a 3rd world country.
Mass poverty will not be eliminated any time soon, except in CCP made up figures and pronouncements.
2035...is that when China lifts the covid lockdown?
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