Will this end in disaster? Or will they just sweep it under the rug?
No. We have a long way to tumble
reply
The US is addicted to debt. China enjoys ever larger trade surpluses and dominated global supply chains, commodity markets. Naturally they also want to control trade routes and institutional structures like banking and global governance. The Wests hegemony is under direct challenge and The West appears to in decay mode. Western governments are dictated to by crony capital and military contractors. Chinese government in contrast directs capital and military in a unified strategic power projection. Who wins?
reply
China has clearly a larger debt burden. And IMO the real estate desaster shows that partial central planning doesn't work. We have to see where in the world free market capitalism, or elements of it, will resurge
reply
China enjoys a trade surplus with almost every nation on earth. China thus enjoys huge surplus funds- in fact what to do with those funds IS a problem- they don't want to put more into US Treasuries. They are investing hugely in infrastructure - globally- belt and road- Chinese controlled trade route from Europe to China. Real estate in China has had some excesses but who had been hit with the bulk of the costs? Greedy naive western bankers- https://fortune.com/2024/02/08/evergrande-liquidation-99-percent-haircut-hedge-funds/ Never have free markets alone achieved lasting wealth- there has always been a substantial factor of good governance and strategy aligned with business interests and the military to achieve resource hegemony and trade dominance. Today China already enjoys trade dominance globally- few if any nations can afford not to trade with China or lose out substantially.
reply
China could displace the US/West within 5 years. The wars in Ukraine and middle east are proxy wars between the West and China. The trend on most fronts is toward increased Chinese dominance and continued decline of The West. Today China builds 50% of global shipping- The US builds 2% The Chinese navy is rapidly approaching US strength and on current trends will surpass it this decade. China is gaining Russian military tech including submarine tech as Russia is now dependent upon China for trade and banking.
reply
30 sats \ 1 reply \ @TomK OP 23 Sep
Right. And there's no real public debate of how to position for example the EU within this shift of geopolitics. Only answer: more cheap money
reply
Yes the days of science engineering and productivity being prime drivers of western politics are sadly long since passed. In contrast in China the vast majority of the politburo are trained engineers. The Chinese recognised and adopted the importance of engineering to economic progress while in the West it became taken for granted as a new creed of financial engineers became the new 'wealth creators' under neoliberalisms crony capitalism. In the West the most powerful engineers now are the financial engineers who work for the banks who in turn own most of the politicians. They add no value- they are simply parasitic rentseekers steadily undermining the competitive advantage the west once enjoyed.
reply