foreignpolicy.com broods over question: Is China "sanctions proof"?

[Gufi]

Baby you have no idea what so ever. Almost all economies in the world be it UK, EU, Japan, China, India, Brazil are highly invested in our economy's survival. So please, our economy won't collapse. And if it will, yours won't survive either.

Japan has the dubious honor of having the highest ratio and the U.S. comes in at number six (see Chart below). Actually, Japan, Greece, Italy and Portugal are in much worse shape than the U.S. despite our $17.6 trillion debt.
The Seven Most Indebted Nations - Forbes
tell me what 4 trillion would do to 17.6 trillion when you have lost your respect and no one trades in dollars anymore. Plus in the eyes of the world you will owe China the money.. Like I said this is not pac man. Any nonsensical replies now will be taken as trolling.

 

[Khalid Newazi]

No we are not sanctions proof at all.

That's why we are trying to internationalize the Yuan (we still conduct a lot of our business in USD), reform our financial sector, and improve our diplomatic connections.

Our economic reform process has not even been completed yet, we are still at a very vulnerable stage. Maybe by 2025 this question can be revisited.

Sure China isn't completely sanction proof but I don't think the term "vulnerable" can be used. Most of US manufacturing giants manufacture their goods in China. US also owes over $2 trillion to China (debt) and investors based upon China and this figure is less than the entire Chinese National debt.

The main reason for trying to introduce the Yuan as a IMF currency is to decrease US influence in global economy and increase Chinese influence in the process.

 

[Providence]

Wrong.

The US depends on the rest of the world for its standard of living created by the artificially high demand for dollars.

US consumption is the result of the savings the world gives to the US. If the US collapsed, the world economy would go on like it has for thousands of years as consumers from other countries can use their savings to buy the goods they produced instead of lending their savings to the US.

US depends on China to absorb the supply of dollars through sterilisation to keep US dollars out of the market to keep the dollar strong. Without major buyers of dollars, the dollar will collapse and so will the terrorist regime.

Pray tell me where will China park it's savings if not for dollar ?

Japan has the dubious honor of having the highest ratio and the U.S. comes in at number six (see Chart below). Actually, Japan, Greece, Italy and Portugal are in much worse shape than the U.S. despite our $17.6 trillion debt.
The Seven Most Indebted Nations - Forbes
tell me what 4 trillion would do to 17.6 trillion when you have lost your respect and no one trades in dollars anymore. Plus in the eyes of the world you will owe China the money.. Like I said this is not pac man. Any nonsensical replies now will be taken as trolling.

Yes. Dollar is the world's currency and that's an advantage.

As for the 17.6 trillion $ debt, well least one can say is, debt to a certain extent is not an issue. Debt is actually good ( since you leverage your future growth for funding your current economic activity ). The flexibility strongly encourages folks to be entrepreneurial rather than running to home and hiding the month's salary in one's mattress.

 

[Gufi]

Pray tell me where will China park it's savings if not for dollar ?

Gold

Yes. Dollar is the world's currency and that's an advantage.

if you renege on payment it will not remain the world currency.
U.S. National Debt Clock : Real Time

 

[syedali73]

China is obviously not sanction proof but it shows its middle finger to the sanction and to those who impose those sanctions.

 

[Providence]

Gold

if you renege on payment it will not remain the world currency.
U.S. National Debt Clock : Real Time

You cannot rely on gold as world's currency. The recent drastic fall in the commodity's price is indicative of it. Such high volatility can never be a benchmark to trade in.

Have you noticed that almost for all countries, the external debt to GDP ratio is rising ?

 

[Chinese-Dragon]

Sure China isn't completely sanction proof but I don't think the term "vulnerable" can be used. Most of US manufacturing giants manufacture their goods in China. US also owes over $2 trillion to China (debt) and investors based upon China and this figure is less than the entire Chinese National debt.

The main reason for trying to introduce the Yuan as a IMF currency is to decrease US influence in global economy and increase Chinese influence in the process.

We do have a significant amount of vulnerability at present, which is why we are pushing so hard for economic reforms (currently ongoing) and the internationalization of the Yuan.

These actions show that we are not happy with things as they stand, we still have a lot to do before we can cushion ourselves effectively against external sanctions or other such eventualities.

There is no time to rest.

 

[Gufi]

You cannot rely on gold as world's currency. The recent drastic fall in the commodity's price is indicative of it. Such high volatility can never be a benchmark to trade in.

what is the US reserve.... Gold... CNY will take the place of the dollar. now enough of your what ifs

 

[Providence]

We do have a significant amount of vulnerability at present, which is why we are pushing so hard for economic reforms (currently ongoing) and the internationalization of the Yuan.

These actions show that we are not happy with things as they stand, we still have a lot to do before we can cushion ourselves effectively against external sanctions or other such eventualities.

There is no time to rest.

Is yuan fully convertible ? Make it fully convertible and remove restrictions on the exchange rate. We will see how China sustains the export powerhouse it has built locally.

what is the US reserve.... Gold... CNY will take the place of the dollar. now enough of your what ifs

US reserve is Gold ??? THere you go !

Cool I won't respond to your gibberish. I now know how much you know about US currency and capital markets.

 

[Chinese-Dragon]

Is yuan fully convertible ? Make it fully convertible and remove restrictions on the exchange rate. We will see how China sustains the export powerhouse it has built locally.

Exchange rate liberalization is a part of our reforms, along with Capital account liberalization and Interest rate liberalization.

It will most likely happen within the next few years, our economic reforms are still in the early stages.

Cool I won't respond to your gibberish. I now know how much you know about US currency and capital markets.

You are accusing Gufi of talking gibberish? Weren't you just talking about "gobbling up our reserves" a few minutes ago?

 

[Khalid Newazi]

We do have a significant amount of vulnerability at present, which is why we are pushing so hard for economic reforms (currently ongoing) and the internationalization of the Yuan.

These actions show that we are not happy with things as they stand, we still have a lot to do before we can cushion ourselves effectively against external sanctions or other such eventualities.

There is no time to rest.

I highly doubt sanction against China will work, many American manufacturers will need to relocate their manufacturing industries elsewhere and this requires a lot of money and time. Thus in the short term this will hurt US, a lot. Also many other countries (Western) will not want to follow US for this same reason.

Is yuan fully convertible ? Make it fully convertible and remove restrictions on the exchange rate. We will see how China sustains the export powerhouse it has built locally.

Why would they? China isn't a Capitalist, they are more Socialist than Communist. Socialism means certain government control on the economy.

 

[Beidou2020]

Is yuan fully convertible ? Make it fully convertible and remove restrictions on the exchange rate. We will see how China sustains the export powerhouse it has built locally.



US reserve is Gold ??? THere you go !

Cool I won't respond to your gibberish. I now know how much you know about US currency and capital markets.

RMB has risen over 35% and exports have continued to increase.

Strong currency increases consumption which has made China the 2nd largest consumer.

 

[Echo_419]

No we are not sanctions proof at all.

That's why we are trying to internationalize the Yuan (we still conduct a lot of our business in USD), reform our financial sector, and improve our diplomatic connections.

Our economic reform process has not even been completed yet, we are still at a very vulnerable stage. Maybe by 2025 this question can be revisited.

Nah you are sanction proof since your economy is too connected with the west & unless the west wants to do damage itself very much you are sanction proof

 

[Providence]

RMB has risen over 35% and exports have continued to increase.

Strong currency increases consumption which has made China the 2nd largest consumer.

DO you all chinese lie when it comes to numbers ?

This is the data which I fetched jus NOW. IT has weekly exchange rate and past year's data as well.

RMB have actually weakened over the last 52 week period albeit very less but terming it as becoming stronger to $ is an outright lie.

 

[Chinese-Dragon]

Nah you are sanction proof since your economy is too connected with the west & unless the west wants to do damage itself very much you are sanction proof

China is right in the middle of the largest economic transition of this generation, we are trying to re-balance our entire economic model, if that is not vulnerable then I'm not sure what else you would call it.