U.S. Congressman Nancy Pelosi's surprise visit to Taiwan in early August sparked a tense standoff between China and the United States. Immediately after that, the Taiwan Strait exercise was also launched in just a few days, which made the outside world feel a reversed atmosphere. However, this is only a symptom of the Taiwan Strait issue, and the real struggle is being waged under the table. This is a game of core interests between China and the United States, and the United States has already launched a challenge, and China's response has only just begun.
To understand the essence of this struggle, we must first understand what are the core interests of China and the United StatesThis is the basis for analyzing any problem. Fundamentally, at this stage, China's core interest is Taiwan, while the United States' core interest is the dollar. This incident is precisely a kind of probing and counterattack adopted by the United States at a time when the international status of the US dollar is under threat.
Rather than sit idly by, China has taken a series of countermeasures, some of which are already showing results. From the perspective of core interests, we can take a look at the gains and losses of China and the United States in this fight, so that the next confrontation will be carried out in what aspects and in what way, so that we can be prepared.
What is the real purpose of Pelosi's visit to Taiwan?This has always been a mystery. On the surface, this is the result of lobbying and invitation from the Taiwan authorities, but in reality, this is only one side of the story, and in the whole incident, the United States is the party that really holds the initiative.
To go or not to go?When to go?These key factors are determined by the Americans. In the end, the choice of visiting the country in early August may have special significance and considerations, and may be closely related to the core interests of the US dollar and financial factors.
Because of the Fed's tightening policy, after raising interest rates in July, the interest rate level reached 25%, which is considered to be the level of the neutral rate, and it is also the level at which I personally believe that the cost of funds and yields of US stocks have reached an equilibrium point. In other words, the next step of austerity policy needs to be evaluated in stages.
And the most worrying thing is that after the US dollar raises interest rates to this level, internationally, as the European Union also began to raise interest rates in July, this means that except for Japan, almost all developed countries in the West have followed the United States and entered a tightening cycle. In the next step, it is likely that the financial policies of developed countries will be completely synchronized and collectively tightened, while developing countries will have to face the dual tightening pressure of huge inflation, interest rate hikes and capital outflows.
Will these developing countries be able to withstand the next round of austerity?The answer to this question will have a bearing on the future way of living and the standard of living of the entire Western world, and in a small way, it may determine the financial policy of the United States, how it will adjust it next, and in the big picture, it will determine the national fortunes of the United States and the future world order.
In terms of the overall strength of the economy and finance, there is one of the biggest uncertainties in the ranks of developing countries, and that is China. In the big picture, if the U.S. financial austerity crushes other developing countries, only to be copied by China, it will determine the first and second positions in the future world, and then change the future world order.
In this context, it should be a relatively necessary thing for the United States for an old lady who is about to retire to test the bottom line and core interests, so as to provide an effective and reliable basis for the formulation of the next austerity policy.
Some people speculate that Pelosi's visit to Taiwan this time is to provoke conflicts, create crises, and allow the dollar to continue to flow back, but judging from the reactions of the financial markets of the previous parties, there is no sign of such a sign at all. This is completely different from the previous market reaction when there was a conflict in the European direction.
You know, if it is for the outflow of capital, then capital will inevitably have an understanding of the scale of the crisis in advance and thus react to the trend, but the actual trend is not like this, so this speculation is not valid in fact.
In a sense, this can be seen as a test of what the United States can achieve in the coming financial tightening. If we still judge from a financial perspective, from the perspective of the US side, we can get a preliminary bottom-line test result.
After the Russia-Ukraine conflict, starting from Russia's pricing and settlement currency for natural gas in rubles, we can define the core of today's anti-American international affairs as the dollar. As far as we are concerned, our core interest is Taiwan, and this is our bottom line.
Then, judging by the test results of this incident, for us, dealing with the Taiwan issue will take precedence over going to the dollar. This should be the result of the assessment that the United States has obtained this time.
This result is very important for the United States, because it will affect the next step, when the United States is carrying out financial tightening, if the United States tightens the asset bubbles of other developing countries, there may be a window of opportunity for others to be **, so in order to prevent others from picking the fruit, what effective countermeasures can the United States choose?
That's probably one of the reasons for their selection.
This is also the reason why I personally regret that when Pelosi landed in a transfer, we did not take countermeasures. This has given the United States a sniff of an opportunity.
Because to go to the dollar is to go to US hegemony and to go to the US-led international order.