East Vs West

Russia attacking Europe via Ukraine is just the beginning of what is to come. The main game is when China makes its move.  China wants to be the main player the way it has been for centuries. That is why they call themselves the Middle Kingdom. Everything should revolve around them. They want that back. They think that in the age of humiliation, that important position was stolen from them. They think the USA being the leader of the west is the usurper. 

In my opinion, this is a fundamental misunderstanding of the USA. The United States of America claims to be a Republic. However, it often looks more like a Corporatocracy.  This is why the NRA and "big pharma" have such illogical control in the USA. Other examples are probably too numerous to mention. The USA is all about making money. They know how to make money and they know what environment needs to exist to make money. They know that China has huge potential to make money and the people in the USA desperately want to be part of that action. But they also know that the environment to make money in China is incomplete. And that is a big problem. 

The Chinese think the Americans are trying to stop them from regaining their Middle Kingdom status. If promoting China makes the Americans money, then nothing could be further from the truth. The trouble is that the Americans understand that the more transparent the market is the greater the participation by the entire economy. China potentially has a huge economy. The Chinese Communist Party will not release power so there will be no transparency in their marketplace. This means the Chinese Stock Markets will be just a sideshow to Wall Street. If the Chinese Stock Exchange was trusted by the entire World because it strictly followed a transparent rules-based system, it would be much bigger than Wall Street. The CCP stops China from being great, not the Americans. 

Right now China is trying to create an alternative monetary system to the Americans. Finance and trade are based on trust. The more transparency in markets and markets are controlled by systems that are based on clear and intelligible laws, the more functional those markets will be. Also, since the US has been the reserve currency since 1945, its liquidity allows everyone around the world to use and trust the US dollar. For a country like China to try to wrestle the reserve currency away from the USA means they don't understand why the USA has the reserve currency status. 

Yes, the USA sanctions countries using the power of their reserve currency. But they do so only when they think human rights have been violated or International laws broken. The USA knows that using their reserve currency status as a weapon is a two-edged sword. China offers to never sanction any country if given the right to reserve currency status. Yet China continually interferes in its own markets so why would anyone trust them not to interfere in international markets? So even if they kept their promise not to sanction other countries, their markets are non-functional because they are polluted with politics. And not just any politics. Their politics is just one big black box. 

The Chinese system of Government claims to provide more order for their people. They hide their chaos inside that black box called the CCP. The Chinese can plan long-term and achieve remarkable progress. However, the Taiwanese have achieved great progress also and retained more political freedoms. So the CCP can't claim that their people would only thrive with the communist system. They know that is not true. Or do they? Have they drunk too much of their own propaganda juice? Have they lied to themselves for so long that they think we in the West are the fools? 

It's not about ideology. It's about power. That's why they seem afraid of the West. They won't share power either. It's too precious. You need to be connected even to have the right to prove your loyalty to serve. You need to be a "Princeling". And to get rich in China requires a powerful sponsor from the political class. China has what the ancient Roman Republic had, a patrician class. Senators could only come from this class of people. The rest were plebians. But then an emperor evolved from the patrician class. It happened back then. It's happening now in China. The last thing a free and open market economy needs is an emperor with so much power, he can change things overnight. This is why China will never be the Middle Kingdom ever again while the CCP exists. 





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