China: neither military nor monetary threat – The Property Chronicle
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China: neither military nor monetary threat

The Economist

Seldom since its civil war and prior to that its battle for independence, has America’s internal future/fortunes been so vulnerable to the actions of outsiders serving their own ambitions. This time, however, it isn’t dealing with the conflicting colonial interests of the British, French, Spanish and indeed Mexican empires, but a singular Asian powerhouse. This is not, of course, the first time the region to its west has delivered a protagonist upon the United States. On this occasion it will not, however, be blindsided by a military strike from a small but aggressive Rising Sun – which it successfully sees off, as from December 1941 – but ever-growing monetary pressure from an economic Titan against which it will have no reasonable defence.

IChina’s efforts to establish the yuan as a global force – so as to build a deep credit market in it – can only come at the expense of investors in dollars and treasuries. There will, of course, be those claiming there are sufficient global vested interests for such dénouements to be impossible, or happen very slowly. One only has to look back at empirics to see how the sun can set suddenly on a once-dominant financial empire to quickly rise on the usurper; one to which those once loyal to the previous financial force then pledge themselves, even if only reluctantly.

There will, of course, be those claiming China is the one threatened economically – in which case, we all are. Let me at this point be very clear: I do not subscribe to such alarm regarding China. Rather than speculate on possibilities, let me consider realities. 

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