The Dollar led world finacial and economic integration always considered unsustainable now seems to be in its terminal stages. What may follow cannot be fathomed. Yuan can’t imagine replacing USD as global currency as to replace USD a country has to run current ac deficit like US
https://twitter.com/svembu/status/1484457490997673984
Instead China is running a huge cureent account surplus which means the only way Yuan will be available to the world is by loan or whatever investment. If USD ceases to be the accepted global tender China will not be the gainer. On the contrary it may lose. And badly
The world which is becoming multipolar may also become a multi currency world with the mighty combination of finance trade and economic integration and single market and supply chains founded on that becoming a matter of the past
It is only then that the individual worth of a nation’s economy, its future prospects will enter into detriming its worth and the fake valuations created by export surplus determined in terms of USD will get neutralised. It will be an unthinkable development
The assumption underlying globalisation was the final victory of the West over the Rest and the Rest having only to follow the West was the result of the euphoria of the collapse of socialist bloc. But the West never realised that the rest did not mean the socialist bloc only
The collapse is the coldwar order was seemingly managed by the orderly transition into rule based global order led by the West but that ambition was shattered by the consumption led US economiy and its irresponsible borrowing into the future.
In 2006 Alan Greenapan co authored a paper which admitted that between 2001 and 2006 the subprime lending against home equity was over $3.5 trillions almost the whole of which went in consumption. This was endorsed by fake macro economic theories trotted out over 3 decades
The 2008 crisis Greenspan admitted was collapse of all that was considered stable. The guild of economists fought like urchins over the cause of the crisis. Paul Krugman got Nobel prize for declaring 30 years of macro economic theorising as useless at best and harmful at worst
No functioning macro economic theory today is universally valid. US has been running current account deficit now for 45 years but USD value which should have collapsed is now 3 1/2 times its value in 1976. Two Harvard economists dair US economy does not run on economic theories
They said that the US economy runs on the theory of physics which says that a dark matter sustains the universe. The Dar matter sustaining the US economy is its lead position, its power, its efficient government and military power. This was in 2006
Now that dark matter is being seriously threatened by the developments sequencing from 2008 and the rise of China and the erosion of the US as a civilisation thro ultra liberalism Wokism which has split the US vertically
The US today has lost its civilisational resources with its family in tatters, with more than half the people on government support and its system heavily corrupted and intruded by China. A china that aspires for global power is a greater danger to itself more than for the world
The post covid world is in serious crisis that Henry Kissinger who theorised and instituted the post coldwar order has quietly said that the world orde would change for ever. From what is clear. But into what no one knows. Fukuyama predicts the decline of the liberal order
India has seen ups and downs for 5000 years and more. We still have retained our religion, community base village life family system despite all attempts of the liberals to destroy all these. Let us wait. We can wait as Aldous Huxley said with patience and even with satisfaction!
We need not take any decision in a hurry. So long as there are nationalistic Indians like @svembu and many like him we will manage the global upheavals bette than the rest of the world put together.
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