Worried for Premier Wen
Not long ago, Premier Wen expressed his concern at a press conference: he is most worried about the security of Chinese assets in the United States. That's $2 trillion, the hard-earned money that the Chinese people have accumulated over 30 years of hard work! For this money, China has sacrificed the environment, resources, and the interests of the vast number of farmers and urban workers, and has incurred a huge moral debt, taking on enormous political risks, hoping that the country can have some savings for future needs.
But Premier Wen's nightmare is likely to become a reality. Yesterday, news came out that the Federal Reserve has decided to print $9 trillion, of which $2-3 trillion will be used to purchase government bonds. As soon as this news came out, the value of the US dollar immediately depreciated, and the price of gold rose, triggering serious concerns in the market about the medium and long-term debt of the US dollar. The anger of the Japanese people soared because they are also one of the major creditors of the United States. Subsequently, the European Union and other countries also devalued their currencies, laying the groundwork for future global inflation and massive social unrest.
The relationship between China and the United States is very similar to that between a poor person and a rich person. The poor person earns some money from the rich person, but dare not keep it with themselves, thinking that it is safer with the rich person, and also hoping that the money will earn interest in the future. But unexpectedly, this rich person is a greedy robber. Not only did he spend all the money you put with him, but he also incurred a huge and irreparable debt. What to do? There are only two options: one is to continue borrowing money, repent, and slowly repay, allowing future generations to repay; the other is to simply use the methods of the robber, not only not repaying the debt, but also dragging everyone down. This method is printing money. It's like borrowing money from someone and not repaying it, just leaving an IOU. The result of doing this is that governments around the world start printing money, and in the end, there is inflation. When there is an economic crisis and no one is spending money, the best way to force everyone to spend money is to create inflation expectations. If you don't spend money today, tomorrow your money will be worthless. The result of doing this is that the government and the wealthy don't care, the government gets through the economic crisis and the political crisis, and the wealthy can earn even more money. But the vast majority of people who rely on wages to survive can't bear it for long. Just think about it, with an annual inflation rate of 30%, the retirement savings of a family, whether it's 100,000, 1 million, or 10 million, will be gone in three years! Similarly, China's $2 trillion in the United States will also be gone in three years! What will the world be like then?
Because China's political system determines that its political risks are greater than those of Western democratic countries in an economic crisis. So Premier Wen's nightmare is actually the nightmare of all the Chinese people. Faced with an unprecedented crisis, we seem to have lost everything except confidence. And in order to highlight confidence, propaganda and interest groups are instilling blind optimism in the people. This is even more terrifying and irresponsible. Because the people know the actual situation, they will be mentally prepared. If they are blindly optimistic, once the situation gets out of control, the people, in a state of great anger and despair, will turn problems that could have been solved into completely unsolvable ones. The people have lost trust in the government and sources of information. Confidence is actually built on a foundation of trust.
The blind optimism in China is manifested in the strong support of the stock market and the various contradictory information about housing prices. Now, Chinese experts are also calling for the depreciation of the renminbi. Since you are all printing money, then we will too. The currency war begins. The next step, if international raw material prices rise, in the end, who will be the one to suffer? It will still be China!
Perhaps China was fooled from the beginning. Because saving the market is not China's responsibility, it is the responsibility of the United States and Western countries. China's 4 trillion yuan stimulus to boost domestic demand has only increased the value of energy, raw materials, and international capital, and China is the one suffering losses.
From a strategic perspective, China should keep its distance from Western countries. Since we have "socialism with Chinese characteristics," how can we align with Western democracy and free capitalism? Good things are all yours, and bad things are all someone else's? If you really think that way, you will be calculated and suffer great losses! Unfortunately, the nightmare may have already begun!
zz is sweating for Premier Wen
Worried for Premier Wen