The 2 billion they issued was snapped up immediately by international buyers and over-subscribed by a factor of x15. So there is demand. I was positive but not too freaked out over it in my comments earlier. It’s a good thing to keep an eye on but there’s no guarantee this is what will happen at massive scales. The mechanism seems quite plausible in washing USD back to the US, helping countries with USD depts and advancing Chinese (non USD) trade and intergration with RoW. But there are always ways this mechanism gets nixed. The broader theme is correct though i think, a main motivation behind this is to experiment with ways to decrease US(D) dependency, level the global financial playing field and calm down the starving levels of demand for USD liquidity that holds a firm grasp in many if not most countries. It does have big "find out potencial" but there is no singular thing or move to uproot USD hegemony. More so China and maybe more importantly the US to slowly bleed it enough with a thousand cuts
I have repeatedly said that China has far surpassed America industrially, technologically, while the state has succeeded in retaining much control of its national resources, industries and financial institutions.
This is the most barebones positive thing that you can say about China. So much so that its barely a "positive" thing to say rather than just an observation of reality that has leaves room for personal interpretation,opinions and analysis. Its a concrete reality so undisputable in most aspects its a view held even by most anti-china leftists, liberal comentators and increasingly so mainstream media. Its also not a description or reaction to current geopolitical and monetary events and choices by the Chinese state but a general observation of the material and bureocratical ourcomes that have culminated from how the Chinese system was set up and operated over decades. Doesnt really contradict anything my comment said
So he has spoken favorably about things that happened before he started commenting on current developments but never about any contemporary development or move at the point of commentary. And that favorable coverage of past moves is pretty much never on its own but is actualy only brought up in the context of their current doomer negative coverage to as to comperatively highlight and support his current negative coverage.
Saying "Back then i actualy thought this and they were doing the good thing but i was naive and they libed up now" doesnt negate my description that there hasnt been a single Chinese foreign, monetary or developmental choice that happened while they have been an active commentator on this sub that they didnt react negatively and that there hasnt been a single US foreign or monetary policy move that they didnt cover as a correct chess move for the empire. It actualy enhances it
I actualy already answered a previous comment they made on this topic and i already made my own post in this post about the topic. Thats why i started this comment saying that since we already talked past each other on this subject im gonna make a more general observation
Anyone can really write anything and there will be credulous people who want to believe it to be true.
I wont comment on the topic again , i already did twice and since whatever we wrote goes past each other its no use. Im just gonna point out that what you say can also be used to dismiss the analysis you write on the same basis. Some people wanna feed on copium, some on dooming. "credulous people" exist in both directions. The fact that there hasnt been a single Chinese foreign, monetary or developmental choice in the last 1+ years that you have reacted to and written about positively here and that there hasnt been a single US foreign or monetary policy move that you didnt cover as a correct chess move for the empire strains some of your credibility as an objective analyst of these developments through marxist lense, no matter how detailed your analysis or knowledge background is.
On a foundemental level simply because the ratio of good move / bad move for these countries cant remotely correspond to what your coverage is just based on a look around the world today, the two countries and their recent (and not so) history. Also off the to of my head the fact that you have jumped to the chance to doom post the momment you see the most obvious anti-china garbage stories like their submarines sinking (did it twice actualy, the latest one has been predictably once again proven an overexaggerated nothing recently) , using anti-china YT thumbnail level stats for some of your dooming (100 trillion vaccant buildings in china! Chinese EVs make no profit in China!) or reddit analysis for a potential Sino-American conflict (US can checkmate china by strangling Chinese sea trade roots ) doesnt exactly paint you as an non biased unemotional observer bringing some hard reality check to multipolarists and China hopium posters, it shows how easily you can edge towards the opposite side.
The car aint going anywhere in the coming decades for hundreds of millions of people. The best case somewhat realistic scenario enviromentaly for those people then becomes those cars being EVs along with cheap and abundant clean electricy through renewables and battery advances. There is, or at least should be demand for this scale of expanded EV production. At least in China there is
Just the BYD Zhengzhou Gigafactory, currently under expansion, compared to the biggest Tesla factory. It actualy can fit every single Tesla factory in it with room to spare. Its already like, a third of the size of Manhattan. The plant 70k workers in 2024.
An angle from the ground, dont know from when. Bunch of wind turbines on the background tho.
A video of the immense construction going on for the expansion as well
More than a few. But that doesnt mean they cracked some big physics or engineering problem the EU scientists are in the dark about or that these sectors are taking advantage of inventions or breakthroughs the EU isnt aware about in a theoretical level. There are 100 small things (that arent exactly tech secrets) that manifest into a large competitive advantage through a 100 well oiled layers of state planning, "free market forces(blehhh...but yeah)", R&D, subsidies , investment, raw material access and refinement capacity, human capital capcity, supply chain logistics and intergration, AI intergration in manufacturing, automation etc. The EU, or the US for that matter, wouldnt be able to replicate this even if China put 100.000 EU engineers and scientists into forced training camps for years
Now this seems like a chatgpt summary of every comment you have made in the last month. This cant be a response to what i wrote. The US isnt building any real supply chains that dont include China, this move only strengthens Chinese supply chains with those nations, manufacturing and financial. These are supply chains of real commodities and Chinese tech that are owned and opperated at various stages by China and Chinese companies or intergrated to Chinese supply chains to function or even create value for the home country. How much of the, already trillions in value, supply chain assets and investments China that has already built and created world wide has been bought by Wall Street and now opperated by American directions and in Americas favor? They have had already a decade to do so. An insignificant amount as far as i can tell unless there is some hard data pointing otherwise
USD usage and volume isnt expanded by this move. I listed at least 3 ways of how its the opposite really. Beyond third world countries unilateraly defaulting on USD depts or China liquidating their reserve to buy their depts of and meet their dollar demands , mechanisms like these some of only of the only other ways for that dept circle to evovle with fewer and cheaper USD in circulation worldwide.
Who cares if they do. The advantage China has is the economy and scale and vertical intergration they have build in those sectors. There isnt actualy some super secret sauce there like what asml holds with lithography. Top EU universities ,physics, engineering and chemistry teams already now almost every development the chinese put into work for batteries and EVs. It would do fuck all to help the EUs industry actualy be competitive . Now and even more so in 10-20 years. Either eay the momment china does tech share with idk Brazil or Mexico when they open some plant there the west gets everything through industrial espionage as well
There was some news a couple of days ago of China issuing 2 billion in USD denominated sovereign bonds that surprisingly was treated negatively or as some capitulation to the USD. I feel like this is quite different
I see this as creating a small triangular financing mechanism to help offload from the USD collectively with the central fulcrum being a facilitation of $ for ¥ swaps. The end result is global south nations pay down USD denominated liabilities & export resources to China earning RMB.
Simply put Gulf (and others) countries have too many dollars, China sells them these bonds, China uses these dollars to fund poor countries (investments, imports whatever), Poor countries use dollars to pay debt, Poor countries and gulf countries sell their natural resources to China in yuan then China sells its technology to these countries in yuan. Saudi flushes out $, China gains real resources, poor countries less poor, net negative for the volume of $ being outside of US borders. Meanwhile Chinese sovereign bond buyers are also using these bonds as collateral for Chinese tech & infrastructure projects in Saudi Arabia and their respective home countries. For China it also represents a very slow conversion of excess USD and their own trade surpluses into physical commodities while creating demand for their own currency. These commodities will continue to rise in USD prices while falling in RMB prices. They will have to repay these bonds upon maturity eventualy but it will be with cheaper dollars as commodities reprice higher in tighter supply-constrained markets. So even in the long term there is another net loss of USD.
Another angle is that many coutries are facing double digit borrowing costs in USDs to rollover or service USD debts. China can stabilise these at rates almost identical to US Treasury rates , these bonds were issued at just 1 base point over UST! after all. Another net negative effect on dollar circulation and accumulation. It basicaly tries to flip the Dollar Milkshake Theory to its head. China could have used its UST for this without all this roundabout thing, sure. But China is maintaining/reducing its UST reserves slowly because it doesnt want to blow up the global financial enviroment and insert a ton of volatility . But the needs of many countries for USD liquidity are way higher than China's rate of liquidation . This bridges that gap and allows China to do smth
inferior hardware but cheap as shit free energy to train them