For the first time this century, China’s role has shifted from a major provider of capital, primarily to developing economies, to a lender that claims to service debt. This shift will have far-reaching implications for global credit conditions. It could fuel instability in many parts of the world and lead countries into strategic geopolitical realignments. …
Tag: China
Trust Economics: A new Global cycle of terror is underway
The world is on a grim and unpredictable path, with geopolitical upheaval, military conflicts, and economic derailments creating an explosive combination with unpredictable consequences. The Middle East looks like a powder keg ready to explode, as Israel and Iran are one step away from open conflict. Meanwhile, the United States is sinking deeper into a …
China abandons the Dollar and buys Gold – Liquidated $27.6 billion in US bonds
China’s decision to dump US bonds and at the same time engage in massive gold purchases to bolster its foreign exchange reserves amid a trade war is heralding a monetary earthquake. This move did not come as a bolt from the blue as Beijing’s gradual withdrawal from US debt began during the period of sanctions …
China: Asks the US for a “soft” dollar exchange rate in return
The real cause of the US-China trade war is the dollar. Namely, the dollar/renminbi exchange rate. This may seem paradoxical as tariffs have skyrocketed to levels unthinkable in the recent past and the free trade agreement on both sides of the US-China trade war. What needs to be considered is a high-stakes macroeconomic agreement between …
Tariffs and the $3 trillion held by Asian central banks that make them punishers in the US bond market
Great turmoil, great situation – to use a phrase from former Chinese President Mao Zedong to sum up the trade war declared by President Trump. The dollar extended its biggest plunge in three years on Friday, April 11, after China raised tariffs on U.S. goods to 125% from 84%, a step up in tensions that …
Trump kills the “hard” dollar with tariffs & regains US economic dominance
The roots of the US economic hardship are found in the dollar, the head of the “wise men” of Donald Trump’s government, Stephen Miran, found in a study he wrote in November 2024 (“A User’s Guide to Restructuring the Global Trading System“) and which is the guide to Trump’s economic policy regarding international trade/tariffs and …
Trump tariffs will cause an unprecedented global crisis
A major slowdown in global growth is expected to be caused by US President Trump’s impending “tariff wall”. The recession will start with a dollar liquidity crisis in China and end with a crash in the US, as funding pressures circulate through the global banking system. Because China runs a large trade surplus with the …
Gold is a formidable monetary weapon – the mysteries of Fort Knox and China
One of the most significant long-term effects of this War in Ukraine, regardless of when a peaceful settlement is reached, will be on gold and the dollar. That is, in the realm of an ongoing currency war. When Russia launched its military operation in Ukraine, it overlooked the fact that its central bank had about …
Demand for gold at historic highs – China’s role
The current bull market in gold began in the spring of 2024, fueled largely by aggressive Chinese traders who invested in futures contracts on the Shanghai Futures Exchange (SHFE), while Western investors remained on the sidelines. In just six weeks, from March to April, these traders drove gold prices up by $400, or 23% – …
The huge Public debt and Budget deficit, the trade war and the… problem with the dollar
Investors around the world spent much of 2024 worrying about China’s problems with the housing market and deflation. In 2025, it’s the US’s turn to be the star of the negative scenarios. While Donald Trump’s trade war is making headlines, the rapid decoupling between US net foreign investment and the level of federal debt is …