China’s stock market troubles sends shivers across the world

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China’s capital market trouble is now all over the headlines. Despite being at the center of mockery by the Feds in the US, Beijing’s economic convulsion is affecting markets everywhere — and this gloomy story should put some breaks to the West’s China-bashing indulgence for this issue will affect them just as badly.

Although it is too early to point to a specific cause for the global ‘panic’, Western outlets are already spreading the blame on China’s recent currency devaluation, a policy implemented to beat lower market expectations for its economy.

For a while now, China’s economic team have figured that the way forward is to pivot away from exports and investments and instead focus on a consumer-driven economic activity. But this rebalancing has had the effect of less industrial output, and thus led to the propping-up policies. What followed was the devaluation of the Yuan to help China maintain its manufacturing competitiveness.

This policy has caused problems for analysts in the West where they insist that China is playing the currency manipulation game. But guess what? Since the 2008 financial crisis, Washington has repeatedly printed more money (euphemistically called Quantitative Easing) to artificially manufacture ‘recovery’, the consequences of which have helped undercut global competition.

The US Federal Reserve has a problem with China’s currency devaluation policy, but not with its own reality-distorting stimulus.  Not many realize that this inflated money-printing policy is actually just a bubble: zero interest rates have artificially propped-up the US economy. That is why those in the know worry what may happen once the Feds take away zero percent interest rates (running for 7 years now).  Once this fake shroud blows away, the United States will be sent back to recession once more.

According to Western market ‘analysts’ and commentators, China’s present capital market strain has caused people to panic. But who are those people anyway? They are the investors and analysts who recklessly took risks that led to the 2008 financial meltdown and then quickly spread the propaganda of economic recovery.

They are the same people who always screamed wolf on everything Chinese.  As they see it, Beijing’s present trouble presents an opportunity to further deepen the country’s political chasm anyway.  Indeed, in their view, economic woes translate to more political accountability, which in turn gives way to mass discontent. It will be only a matter of time before we see Western media headlines cry Occupy Hong Kong 2.0, but on a much larger scale this time.

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America Goes on to Sacrifice Economy for Influence

It has been a decade since the September 11, 2001 attacks on the US; a solid ten years of rambunctious terror here and there, weakening of American leverage, influence, and leadership, as well as the rise of non-Western powers as the new leaders of the new century. At this point, it’s become tiring to mention “9/11” or colloquially known as “twin towers attack”, really.

Looking at this September 11 date from 2011, it can be interesting to figure out ‘what went wrong’ and if there is any room for improvement left for the US to do. In that ten years, we saw the sharp rise of BRIC countries, skyrocketing of energy prices, the greatest recession the capitalist world has experienced, the fall of overstaying leaders in the Middle East and Africa, and unprecedented disasters from natural calamities that further confirms that global climate change is real and thus further limits the world’s options for development.

In the months following the 9/11 attacks, the US experienced a much needed sympathy from the global community; although a small fraction of the global population saw the US as the menace, the greater population grieved and empathized with the US. But in the next few years, we saw a dramatic decline in how the world viewed the “Global War on Terror”, especially after the 2003 American invasion of Iraq: no weapons of mass destruction and the rest is history. Despite that, even in Barack Obama’s time, the promise of withdrawing from the ‘oil lands’  has not been met. The American war machine continued to rally its allies to foreign lands and as a consequence, sharply compromised its economy.

Indeed, Uncle Sam is in a really hard position these days: how do you balance global leverage with a failing economy? The more matured analysts advises the West to step aside and allow for change, than to be empire nostalgic.

But this is not the case, even after the Western recession of 2008-2009. Instead of pulling out from foreign lands, the US is taking advantage of the regime changes taking place in the Middle East and Africa. How hypocrite it is to see how the West literally embraced Gadaffi in the past but today we see him being betrayed by his ‘energy partners’. Indeed, the US not only needs to secure energy for its own consumption, but also to actually profit from it by ‘owning’ the top oil producing countries. As the Gadaffi regime ends, otherwise NATO allies like Germany have become self-critical, blaming local policies for not joining the greatest oil looting in recent memory and thus, cannot take part in the oil bounty.How many times did we actually witness how the West encroached governments? Did we really think that the US government interventions in South America during the Cold War ended there?

And then the China equation aches to be solved: What to do with China’s phenomenal rise? Everyday for at least the past decade we are bombarded with endless news about a China that is a non-responsible, economically and ecologically unsustainable country that needs to be tamed if the West is to maintain hegemony and a one-polar world. What the US cannot do by itself, it outsources, encouraging new powers to contain China. In a recent conversation with an Indian colleague, it is truly enlightening to realize that it seems that the US agenda for India is to pit it against its neighbor China. But it is more important to know that for now, India is not interested to become a US puppet.

What the West needs to do and avoid does not require hard thinking in actuality, it takes just to give up imperialism and see where the winds of change bring the world.