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42 sats \ 4 replies \ @optimism 18h \ parent \ on: Developing nations rack up $3.9 bln in net debt payments to China a year econ
I was thinking: the way to get RMB is to trade in RMB. You sell your natural resources to China... for RMB, then you service your debt to China in RMB.
Still dependent on their policy because fiat is a ponzi.
Some countries may be able to service their debt with trade surpluses in RMB, but that comes at the expense of others if the overall supply of RMB remains flat.
If China wants a given project more than the natural resources you can trade to service the debt, your only recourse is default.
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Oh I don't think that can be negated with any fiat scheme where you take debt from the issuer denominated in their currency.
It's easy resources for China. You print RMB and you get resources for basically air. It's the US cold war playbook, except the Chinese are (obv.) not "protecting" you against communism, but against "exploitation". While exploiting you, but that's not in the foot notes.
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The difference is that the Chinese government directs capital - whereas in the US for decades capital has directed the government.
The Chinese CCP elite are 80% composed of engineers- building an empire.
USA today is composed of real estate tycoon- game show host raconteur and corporate lobbyists/lawyers.
The CCP knows if it fails to improve the Chinese economy it will be removed (probably brutally) and humiliated. Heavens Mandate.
US politicians serve their corporate sponsors and walk away unharmed to go on lucrative speaking tours while the other side picks up the baton of power and continues to serve the same self serving parasitic corporate lobbyists. Crony Capitalism.
Crony Capitalist Democracy is thus, counter intuitively, less accountable and less functional than Heavens Mandate Autocracy.