How China Helps Russia..
How China Helps Russia..
..a Taiwan embargo and a new reserve currency
The question is whether these countries can develop an alternative new economic order to protect themselves from the fate that Europe imposed upon itself this year. The Euro Without German Industry. Michael Hudson.
Russia, China and their 134 allies and trade partners will launch the new economic order when the auguries indicate. Right now..
Putin’s Busy
The SMO is distracting President Putin, but his Reserve Bank governor – the world's best, say fellow-bankers – has been busy since the PBOC demanded a new reserve currency in 2009 (and most Nobelists agreed). She's been trialling the new reserve currency1 with the PBOC and EAEU partners for the past 18 months and it's ready for prime time.
Xi’s Distracted
By the Party's National Congress but, if Taiwan's upcoming mayoral elections suggest separation, he will embargo exports of integrated circuit to unfriendly countries. though it sounds like a big deal, China can enforce it with little effort. The PRC has a much greater advantage over the US around Taiwan than does Russia around Ukraine.
America’s Choices
The US must then choose between losing hegemony by doing nothing, losing hegemony by losing a war (for which China is fully prepared2 and the US is not), or launching its entire nuclear arsenal.
On current form, all a equally likely.
The new reserve currency is modeled on JM Keynes' Bancor, renamed Special Drawing Rights, SDRs. SDRs derive their value from a basket of publicly traded currencies and commodities. Neutral, stable, difficult to influence.
China’s overwhelming advantage in manufacturing allows it to fire off 1000 missiles every day, if necessary, and most of its missiles outrange and out-punch US hardware, which is a generation older. China has a 3:1 advantage in ships and 2:1 in the air, and more powerful A2A missiles.