In 2024, China's big A market ushered in a sluggish start, which makes people wonder if there is another big drama of financial war? Looking back at history, how did the US dollar harvest the world through ingenious financial tactics after it became the global currency?
The hegemony of the dollar is built on a tight tie to global oil**, which is seen as the blood of industrialization. Middle Eastern countries control most of the world's oil resources and have become industrial blood banks in the eyes of the United States. Through agreements with Middle Eastern countries, the United States has succeeded in making other countries buy oil only in dollars, cleverly pegging the dollar to the global **.
The U.S. dollar was supported by **, and then pegged to oil, and gradually rose to become an international currency, cleverly laying the cornerstone of the dollar's hegemony. This step-by-step financial strategy has elevated the US dollar from paper money to the master of the global economy and a solid pillar of world credit.
In the history of financial warfare, the Southeast Asian financial turmoil of 1997 is a classic case. The American financial giant Soros led its quantum ** to successfully short the currencies of Thailand, Indonesia, Malaysia, the Philippines and other countries, plundering massive wealth and shocking the world. However, when shorting Hong Kong in 1998, Soros suffered a crushing defeat, which was his only defeat.
The United States' methods in financial warfare are not complicated, and it is good at waging financial warfare against other countries, winning more and losing less. Financial warfare is a traditional means for the United States to maintain domestic prosperity, and has been carried out against Latin America, Japan, South Korea, ASEAN, the United Kingdom, Europe and other countries, and successfully achieved the goal of confiscating the assets of these countries in the SWIFT system.
Different from the "currency war" between the United States and the former Soviet Union, North Korea, and New China in the early 70s of the last century, today's dollar financial war is played more ingeniously, through tactical means such as raising interest rates and reducing interest rates, shorting and longing, etc., to achieve plundering of other countries. The essence of the dollar financial war is to exploit and plunder market participants, and the rule-makers become the builders of the market.
At the beginning of 2024, the financial war between China and the United States has become increasingly fierce and has become the focus of global attention. As the world's financial giant, the United States has exerted pressure on China's financial market and challenged the stability of China's economy by manipulating **, dominating ratings, and adjusting monetary policy. This wrestling has aroused widespread concern and affected the direction of the global financial landscape.
In this financial war, the net profit of Bank of America has fallen sharply, and Silicon Valley Bank is facing losses, highlighting the financial problems of the United States itself. The financial war between China and the United States has not only caused turmoil in the offshore market (Hong Kong), but also created false prosperity by going long Japan and India**, which has had a significant impact on China's internal public opinion and capital. China** has taken a number of measures to deal with the financial war, including the release of the restart meeting, the dispatch of the national team, the reduction of the reserve requirement, etc., which has stabilized market confidence, but this financial game of offensive and defensive changes continues.
The essential logic of financial warfare lies in the fact that the sickle of capital tends to quickly cut through a country's leeks and relies on the abandonment of the national currency by its own people. In this case, the spread of all kinds of negative ** and rumors becomes a powerful assistant for the bears, accelerating capital flight. Compared with history, the pattern of financial warfare in the United States today is clearer: blowing up China's offshore market in Hong Kong, transmitting risks to the internal market, and at the same time creating false prosperity by going long to other countries**.
However, China** has taken a series of measures, including the resumption of press conferences, the dispatch of national teams, the National Standing Committee + RRR cuts, etc., to successfully curb the flight of capital. Endurance competition has become the norm in the follow-up development of financial warfare, and the real decisive moment has not yet come. If the United States cuts interest rates, the pressure on China will be instantly reduced, and the real decisive battle between victory and defeat may begin in the future.
Is the Sino-US financial war a "financial war" or a "capital provocation"? The answer may have to wait for future history to tell.