China could overtake the United States and become the world's dominant economy by 2028, five years earlier than previously forecasted!
Because of their government's excessive use of force by Western standards, trampling over the rights of its citizenry during the worst months of the outbreak, their economy has paradoxically strongly recovered and growth is back to very high levels.
It even avoided an economic recession last year and is one of the fastest-growing nations in 2021.
In America, the crisis was handled much differently. Many more have lost their lives, many more have lost their income, and a lot have even lost their profession, but the balancing act of not locking people in their homes was also a national priority!
Courtesy: CEBR World Economic League Table
With all that, there's really no comparing the two countries: China is still growing far faster than America and will eclipse it in size within this decade!
This does not mean that the median wealth of individual Chinese citizens will be greater than that of their counterparts, but it has critical ramifications for the dollar's role on the global stage, since the nation, which is most influencial has a say, when it comes currency regimes.
De-dollarization and the chance that the dollar loses its status have been discussed for a couple of decades, so trying to time it or live by it is impossible.
When I was struggling with kicking a bad habit, I read Tony Robbins' book on the subject and it provided me with the advice that I have implemented for over a decade since, which is that to stop with a destructive habit, you must replace it with a new one.
The Chinese yuan will probably never become a dominant currency, but time will tell.
The point is that the dollar currently enjoys its reserve currency status role because of a lack of suitable alternatives.
China does not offer a safe place for businesses, and they're afraid that the regime would act in ways that are not allowed in the West.
In other words, because of its demeanor, the CCP (Chinese Communist Party) alienates the corporate community domestically and internationally. As much as Americans love complaining about their national debt peril, the Chinese government is much more of a currency abuser, and they do it out in the open.
HOW COULD CHINA CHANGE THE GAME?
During the Trump years, he kept taunting China to play by the rules of the game the West does, but he should be careful what he asks for. He instituted tariffs on imports, as a means of negotiations and of forcing the Chinese to play by international standards of conduct, which we agree they should, if they want a key to the kingdom, but China's entrance to the kingdom does open a can of worms as well.
If China ups its game and allows the renminbi to trade freely, for example, loosening the grip of government over it, other Asian countries would follow suit and the West wouldn't have the advantage any longer of the only trustworthy currencies.
Hear me out because this directly relates to the government's ability to issue stimulus checks and run massive deficits going forward: if Asian countries switch to store their reserves in yuan, half of the demand for dollars would vanish overnight!
Everyone now sees that globalization has helped America's dollar spread to all corners of the globe. Globalization also birthed China's rise to wealth and, in 2021, Asia's demographics serve as a more natural platform for growth, going forward, so it is important to keep in mind that China could make a few power grabs that strip Washington from its seemingly infinite ability to create debt, without major ramifications.
China and the U.S. are now publicly at each other's throats, so I want to be clear that it is in the best interest of both Europe and China to disconnect from the dollar's hegemony since American banks get incredible access to data that would otherwise be secretive, but money flows through U.S. banks so data (critical data) is collected by the U.S. in a way that reveals China's deepest intelligence moves.
The U.S. is one or two aggressions away from forcing the Chinese to take action, and when two empires collide, there really are no winners.
SHTFPlan Staff
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