China Trade War: Why Beijing is Not a ‘Currency Manipulator’
- The Global Trade War is masking the real objective: the Return to the Gold Standard and by implication, the end of the dollar as world reserve currency. Flashback to 1971 (when gold was delinked from currencies), for the dollar to be the world reserve, the USA needed to run massive trade deficits. And the USA has done so for the past 5 almost decades. If there is no USA trade deficit, there will not be an accumulation of dollars in foreign countries’ financial system to serve as world reserve currency.
– - The world export goods and services to USA while America exports dollar to them. If there is NO trade deficit then foreign countries will use their dollar to buy USA goods and services. Effectively, there will not be as excess dollar reserves in their financial system acting as world reserve currency. So for the dollar to dominate the world and serve as world reserve currency the USA must run trade deficits.
– - So when Trump says he wants to correct the imbalance and bring down the trade deficit, he is also implying that the days of the dollar as world reserve currency is over. So when Trump says he wants to bring back jobs to America and correct the imbalance, it implies that America will not be relying on exporting dollars to the world but will rely on exporting goods and services.
– - The offshoring of American factories (in the 1980s-2000s) into China, Mexico, the 3rd world, the Asian Tigers, Europe … is for the purpose of the global dollar hegemony. How can the rest of the world export goods and services to USA when America is a manufacturing power house after WW2? If they cannot export to USA, then there won’t be demand for dollars ie the dollar cannot act as world reserve currency.
– - RT America
The European Union has vowed to retaliate against new US tariffs on goods ranging from cheese to alcohol to olives. European officials worry that a trade with the US is a “lose-lose” situation and that “the only winner will be China.” Meanwhile, there’s an apparent thawing in the US-China trade war and signs of substantial progress toward a new deal. RT America’s Sara Montes de Oca reports. Then “Boom Bust” co-host Christy Ai joins Scottie Nell Hughes to discuss the global position of the Chinese Yuan, which has continued to gain influence among investors, she argues that the currency has achieved a desired stability but that it’s not going to last.
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