North Korea says Nuke Tests Target the US

[gourimoko]

So you can't dispute anything in the article, correct?

Honestly, I think the author of the article makes some claims that he doesn't decide to support, so it becomes difficult to debate. The claim "China has been designated as the future consumer engine" suggests there is a plutocratic authority that is in control of not only the United States and the Western World, but also China. To say that requires a great deal of substantiation. I'm not saying it's decidedly untrue, but until proven, I see no reason to include China in what we already know to be a globalization movement within the West.

To the point of North Korea being a puppet of the United States, I find that hard to believe. There aren't any supporting incidents, historically, that show ties between the political hierarchy in the DPRK and the United States. In Iran under the Shah, it became obvious in a matter of a few years that the entire administration there was a puppet regime controlled directly by the CIA. You could even make such a case for Al Qaeda under Osama bin Laden prior to 9/11 (yes, after several terrorist attacks against the USA, there were operatives working for the CIA that were active members of Al Qaeda).

So I would regard the article as not well grounded in fact.

Lastly, the Chinese economy would destabilize without it's ability to export. They are not a consumerist nation, have no worker's rights whatsoever, and are not geared to become consumerist or self-reliant in the foreseeable future. If, for whatever reason, American and European imports were to cease, the Chinese economy would collapse. If the Chinese dumped American dollars, the Federal Reserve could act immediately and, just as we did in 2007/08, we could spend upwards of a trillion dollars to prop up our currency.

Point being is that in doing so, the Chinese might cause the American debt to rise by roughly 6.25%; whereas the consequences to their economy would be equivalent to suicide. Without American and European imports, they would suffer one of the greatest economic upheavals ever known to man. A complete trade war against America would be disastrous as it would lead to mass starvation, famine, and death, by the tens of millions. China is not a self-sustaining economy, and considering their population density, lack of the necessary agrucultural, and energy infrastructure, I see no way they could "drop" the dollar in such an aggressive manner as to spark a retaliatory response.

 

[OptimusPrime]

Honestly, I think the author of the article makes some claims that he doesn't decide to support, so it becomes difficult to debate. The claim "China has been designated as the future consumer engine" suggests there is a plutocratic authority that is in control of not only the United States and the Western World, but also China. To say that requires a great deal of substantiation. I'm not saying it's decidedly untrue, but until proven, I see no reason to include China in what we already know to be a globalization movement within the West.

To the point of North Korea being a puppet of the United States, I find that hard to believe. There aren't any supporting incidents, historically, that show ties between the political hierarchy in the DPRK and the United States. In Iran under the Shah, it became obvious in a matter of a few years that the entire administration there was a puppet regime controlled directly by the CIA. You could even make such a case for Al Qaeda under Osama bin Laden prior to 9/11 (yes, after several terrorist attacks against the USA, there were operatives working for the CIA that were active members of Al Qaeda).

So I would regard the article as not well grounded in fact.

Lastly, the Chinese economy would destabilize without it's ability to export. They are not a consumerist nation, have no worker's rights whatsoever, and are not geared to become consumerist or self-reliant in the foreseeable future. If, for whatever reason, American and European imports were to cease, the Chinese economy would collapse. If the Chinese dumped American dollars, the Federal Reserve could act immediately and, just as we did in 2007/08, we could spend upwards of a trillion dollars to prop up our currency.

Point being is that in doing so, the Chinese might cause the American debt to rise by roughly 6.25%; whereas the consequences to their economy would be equivalent to suicide. Without American and European imports, they would suffer one of the greatest economic upheavals ever known to man. A complete trade war against America would be disastrous as it would lead to mass starvation, famine, and death, by the tens of millions. China is not a self-sustaining economy, and considering their population density, lack of the necessary agrucultural, and energy infrastructure, I see no way they could "drop" the dollar in such an aggressive manner as to spark a retaliatory response.

The only thing keeping the Chinese from being consumers now is the constant inflation of the RMB to keep it pegged to the dollar. The Chinese people can't afford the products they make for this reason alone. That would stop the minute the Chinese want it to by abandoning the dollar. At that point the RMB would soar, Chinese domestic prices would plummet, and they would all be able to buy the same things we have been buying.

 

[gourimoko]

The only thing keeping the Chinese from being consumers now is the constant inflation of the RMB to keep it pegged to the dollar. The Chinese people can't afford the products they make for this reason alone. That would stop the minute the Chinese want it to by abandoning the dollar. At that point the RMB would soar, Chinese domestic prices would plummet, and they would all be able to buy the same things we have been buying.

But you're argument is premised on several incorrect assumptions. First, that the dollar is the primary influence over the Chinese economy. It is not. It's significance is in that of a common means of exchange. The Chinese have invested in the United States economy by buying our currency, yes, but that doesn't mean they are doing America any favors. In essence, it is a loan we took out from the Chinese. If they decide to divest from the U.S. dollar, then their investment will likely have a negative return.

Next, you don't account for the difference in economic composition between China and the United States. Our economies are vastly different. The Chinese are still, primarily, an agrarian society in the midst of transitioning into an industrialized one. However, many economists doubt the Chinese will ever be able to support their population if people were to migrate into the cities at the same rate that Americans did over the past 150 years. By any account, China is a hundred, to several hundred years from mirroring American industrialization.

To that end, the Chinese can't simply flip a switch and become a consumerist nation; again, they don't have the perquisite infrastructure. One of those prerequisites would be a fiscally empowered consumer class. Considering the extreme consolidation of wealth within China, such a class isn't likely to spring from current conditions.

If the yuan were to appreciate in value, the revenue derived from exports would diminish reciprocally. When adjusted and normalized, the Chinese gross domestic product would likely decrease considering their capital margins are primarily derived from cheap and inexpensive exports. To say that the Chinese population could simply step in and buy the same products suggests the Chinese majority has the financial means to do so. Per capita, adjusted and normalized for differences in currency value, each Chinese person would have roughly $8,000 of purchasing power as compared to ~$48,000 for an American. If consumer trends could be directly transposed from America to China, which is impossible but for the sake of argument, that would amount to a Chinese economy roughly 1/3 (considering adjustments to population size) the size of what exists today.

You must understand, the Chinese economy is what is propped up by foreign exports that are inexpensive as a result of government policies that induce cheap and inexpensive labor. If labor became more expensive, trade imbalances corrected via a closer 1:1 currency exchange, and the Chinese worker became a Chinese consumer; it is highly unlikely their economy could sustain the GDP levels that it currently enjoys. To that end, the revenue and profits of the Chinese economy are, again, largely shared by an impossibly small proportion of the Chinese population. There simply isn't a substantial portion of the Chinese population that could be labeled as either consumers or even future consumers.

If their currency skyrocketed overnight, their economy would collapse.

 

[OptimusPrime]

But you're argument is premised on several incorrect assumptions. First, that the dollar is the primary influence over the Chinese economy. It is not. It's significance is in that of a common means of exchange. The Chinese have invested in the United States economy by buying our currency, yes, but that doesn't mean they are doing America any favors. In essence, it is a loan we took out from the Chinese. If they decide to divest from the U.S. dollar, then their investment will likely have a negative return.

The Chinese currently have their currency pegged to the dollar, refusing to allow it to appreciate. So when we inflate, they inflate, and this has been going on for decades now. So in practice, right now the dollar is the primary influence over their economy. That article I posted earlier shows how the Chinese are working to change that.

Next, you don't account for the difference in economic composition between China and the United States. Our economies are vastly different. The Chinese are still, primarily, an agrarian society in the midst of transitioning into an industrialized one. However, many economists doubt the Chinese will ever be able to support their population if people were to migrate into the cities at the same rate that Americans did over the past 150 years. By any account, China is a hundred, to several hundred years from mirroring American industrialization.

You may be right on many of these points, but the Chinese only need to "industrialize" 15% of their population to have a consumer market the size of the United States, which if they haven't done this yet, I'm sure they aren't far away.

To that end, the Chinese can't simply flip a switch and become a consumerist nation; again, they don't have the perquisite infrastructure. One of those prerequisites would be a fiscally empowered consumer class. Considering the extreme consolidation of wealth within China, such a class isn't likely to spring from current conditions.

A fiscally empowered consumer class comes with a strong currency. That's how ours was created here, and the reverse of that is how ours was destroyed. The extreme consolidation of wealth in China mirrors ours here, not coincidentally as their monetary policy mirrors ours. If they unleash the RMB on the market, the price deflation in China would redistribute that wealth to the lower classes better than any government could dream of doing.

Incidentally, this would be a realistic reason why they wouldn't want to go through with this plan if you want to argue that. I doubt the Chinese government would be too thrilled about empowering their people.

If the yuan were to appreciate in value, the revenue derived from exports would diminish reciprocally. When adjusted and normalized, the Chinese gross domestic product would likely decrease considering their capital margins are primarily derived from cheap and inexpensive exports. To say that the Chinese population could simply step in and buy the same products suggests the Chinese majority has the financial means to do so. Per capita, adjusted and normalized for differences in currency value, each Chinese person would have roughly $8,000 of purchasing power as compared to ~$48,000 for an American. If consumer trends could be directly transposed from America to China, which is impossible but for the sake of argument, that would amount to a Chinese economy roughly 1/3 (considering adjustments to population size) the size of what exists today.

Exports would decline until domestic prices bottomed out, but then the cheaper inputs would negate any disadvantage from a strong currency. That's how it was here back when we had a real economy 100 years ago. We didn't have a problem with exports even though the dollar was as good as gold (or almost). Also, as I mentioned, anything lost in exports would more than be made up for in domestic sales.

You must understand, the Chinese economy is what is propped up by foreign exports that are inexpensive as a result of government policies that induce cheap and inexpensive labor. If labor became more expensive, trade imbalances corrected via a closer 1:1 currency exchange, and the Chinese worker became a Chinese consumer; it is highly unlikely their economy could sustain the GDP levels that it currently enjoys. To that end, the revenue and profits of the Chinese economy are, again, largely shared by an impossibly small proportion of the Chinese population. There simply isn't a substantial portion of the Chinese population that could be labeled as either consumers or even future consumers.

If their currency skyrocketed overnight, their economy would collapse.

And I already addressed all of this part. Your post was well put together and educated. It's just it was educated by the same people that have been wrong about everything since the 1930s. They will be completely discredited over the next decade or two, and people won't know why or what happened.

China isn't some ideal to live up to. Their empire won't last as long as ours did because they know nothing of freedom, so they will never be as economically powerful as we once were. But as the only real producers in the world, they hold all of the cards right now. It's a shame that we forgot that freedom is what made us the most powerful economy in human history.

 

[gourimoko]

The Chinese currently have their currency pegged to the dollar, refusing to allow it to appreciate. So when we inflate, they inflate, and this has been going on for decades now. So in practice, right now the dollar is the primary influence over their economy. That article I posted earlier shows how the Chinese are working to change that.

I would argue the reverse; that government fiscal policy is the primary driver of their economy, not the dollar itself. They could just as easily use the Euro. But the point is they the government of China, as well as international industries that rely on the trade imbalance would argue that the weak yuan works to the benefit of the Chinese manufacturer and, arguably, the American consumer (to which I vehemently disagree, but I digress).

You may be right on many of these points, but the Chinese only need to "industrialize" 15% of their population to have a consumer market the size of the United States, which if they haven't done this yet, I'm sure they aren't far away.

I can't really get how you've come to that conclusion. The Chinese have, by the most liberal of estimates, 25% of their population living with a discretionary income level of 3:1, which is the general rule when classifying what constitutes middle class across economic boundaries. Whereas the United States, that number, at it's lowest level since the Great Depression, still exceeds 60% and will likely climb back towards 70% by 2020.

Furthermore, the Chinese have instituted population control polices that, for all intent and purpose, prevent much of their population from relocating to urban areas; these restrictions are based predominantly on what amounts to class and are permanent for life. Without a radical change, that would take at least a generation of education to complete, the Chinese cannot ramp up their industrial/skilled labor workforce to much higher levels.

Lastly, if we look at Chinese economic policy, they are attempting to construct a capitalist upper class first, hoping wealth will trickle down from Chinese investments locally. Their economic policy is designed to decrease the size of the workforce, by the millions every year.

Quite frankly, their population works to the detriment of the Chinese in almost all cases rather than being a boon.

A fiscally empowered consumer class comes with a strong currency. That's how ours was created here, and the reverse of that is how ours was destroyed.

Totally agree. But there is a complex process to get to that point. It's not simply a result of having a highly valued currency. There are more important factors, including a high level of production and a need to produce (ours was routinely war related), wide-spread education even in trade fields, and a means of enforcing trade agreements. Arguably the Chinese have the ability to leverage their economy to their advantage when it comes to negotiating trade disputes; however, the other two facets they would find themselves lacking.

The extreme consolidation of wealth in China mirrors ours here, not coincidentally as their monetary policy mirrors ours.

No it doesn't. It's not even remotely close. China is an impoverished nation for the majority of its citizens. By no means whatsoever could you say the same about the United States. While there is a great consolidation of wealth in America, it is much worse in China.

If they unleash the RMB on the market, the price deflation in China would redistribute that wealth to the lower classes better than any government could dream of doing.

No it wouldn't. It would cause massive economic upheaval for the Chinese. Their currency changing value would cause extreme unemployment, which in turn would cause drastically lower demand for Chinese goods, ultimately lowering prices and revenues, etc etc. For the Chinese, it would be the equivalent to the Great Depression. I see how that could redistribute wealth in itself. Most economic disasters only hurt the individuals who weren't prepared for them, and generally speaking, that's the lower classes. People who are also dependent upon the massive government systems in China would be the most hurt.

Incidentally, this would be a realistic reason why they wouldn't want to go through with this plan if you want to argue that. I doubt the Chinese government would be too thrilled about empowering their people.

I would contend the Chinese government doesn't want to head back into the stone age. The best move for the Chinese is to stably decrease their population, increase production, increase foreign imports and exports alike, and simply wait for America to double in size. At that point, we'd be closer to parity for them to compete.

Exports would decline until domestic prices bottomed out, but then the cheaper inputs would negate any disadvantage from a strong currency.

First, that assumes that China would have the revenue to import goods. Why would Chinese consumers not be effected by "prices bottoming out?" More likely than not Chinese imports would be reduced, rather than increased, as a result of a higher level of unemployment.

Second, by the Chinese starting a trade war with the United States, it is unlikely they would find many willing trade partners. Free trade benefits the Chinese economy far more than it benefits the economies in the West. While we're provided with cheap goods, we pay for it with generally higher unemployment; whereas, if the Chinese stopped exporting goods to the United States, they would have almost no sustainable workforce. To suggest that a Chinese consumer will instantly replace an American one presupposes there would be no period of time in-between for an economic correction, and that's putting it mildly.

That's how it was here back when we had a real economy 100 years ago. We didn't have a problem with exports even though the dollar was as good as gold (or almost). Also, as I mentioned, anything lost in exports would more than be made up for in domestic sales.

1. 100 years ago most countries used the gold standard. Different scenario.
2. You're assuming, again, that there is no effect to deflation, when in fact the scenario you describe would likely lead to a Chinese depression. You can't simply drop prices, increase unemployment, kill exports, and expect 20-25% of the population of a country to pick up almost $10T in revenue. The vast majority of Chinese GDP comes from external sources. There is no feasible means for China to replicate that internally. What you're describing would be suicide for the Chinese.

And I already addressed all of this part. Your post was well put together and educated. It's just it was educated by the same people that have been wrong about everything since the 1930s. They will be completely discredited over the next decade or two, and people won't know why or what happened.

All I'm trying to demonstrate is that currency is not the only driving force of an economy. China does not have the infrastructure to erect a consumerist economy because they do not have a self-sustaining middle class, nor will they have in the foreseeable future.

China isn't some ideal to live up to. Their empire won't last as long as ours did because they know nothing of freedom, so they will never be as economically powerful as we once were. But as the only real producers in the world, they hold all of the cards right now. It's a shame that we forgot that freedom is what made us the most powerful economy in human history.

But the United States is still the chief production power in the world when it comes to unique goods and services. The Chinese are manufacturers of others goods, but that doesn't mean they are an economic powerhouse. The differences between our economies are vast, and I think you overestimate the strength of their economy. It's a booming economy to invest in, if you're a manufacturer looking to outsource, but that doesn't mean their economy is strong; in fact, I would argue that's what makes the Chinese so controllable.

As I've said before, their economy is propped up by the globalists in order to make money. When 66% of your GDP is from foreign companies (which could be turned off like a faucet), you are not in control of your own destiny.

 

[KI4MVP]

One thing I didn't see mentioned in the debate above. The loss of exports to foriegn countries can't just be replaced by selling the same goods to Chinese consumers because a significant chunk of those exports are manufacturing products for foreign countries. How would they replace all of those lost jobs when worldwide demand for those products wouldn't disappear because they got manufactured in another country. Even if you ignore the issue of countries boycotting china in a dispute with the US, some other country would get those exports and china would lose them.

 

[Huber.]

Don't have time to read all of this. Can someone answer this.....Are we going to die?

 

[Jack Brickman]

Don't have time to read all of this. Can someone answer this.....Are we going to die?

Valar morghulis.

 

[Huber.]

Valar morghulis.

get those nerds.

 

[OptimusPrime]

I would argue the reverse; that government fiscal policy is the primary driver of their economy, not the dollar itself. They could just as easily use the Euro. But the point is they the government of China, as well as international industries that rely on the trade imbalance would argue that the weak yuan works to the benefit of the Chinese manufacturer and, arguably, the American consumer (to which I vehemently disagree, but I digress).

Just because they rely on a trade imbalance now doesn't mean they would have to in the future, and strengthening their currency does not mean they will lose the trade imbalance anyway, no matter what today's "economists" think. The dollar has been in a free fall for 40 years. What has happened to the U.S. trade account since then?

I can't really get how you've come to that conclusion. The Chinese have, by the most liberal of estimates, 25% of their population living with a discretionary income level of 3:1, which is the general rule when classifying what constitutes middle class across economic boundaries. Whereas the United States, that number, at it's lowest level since the Great Depression, still exceeds 60% and will likely climb back towards 70% by 2020.

Furthermore, the Chinese have instituted population control polices that, for all intent and purpose, prevent much of their population from relocating to urban areas; these restrictions are based predominantly on what amounts to class and are permanent for life. Without a radical change, that would take at least a generation of education to complete, the Chinese cannot ramp up their industrial/skilled labor workforce to much higher levels.

Lastly, if we look at Chinese economic policy, they are attempting to construct a capitalist upper class first, hoping wealth will trickle down from Chinese investments locally. Their economic policy is designed to decrease the size of the workforce, by the millions every year.

Quite frankly, their population works to the detriment of the Chinese in almost all cases rather than being a boon.

The numbers aren't as relevant as the fact that a strong RMB would create a new class of consumer in China, and it wouldn't need to be as large as you say for it to make up any shortfalls they would have, if they have any, in exports.

Totally agree. But there is a complex process to get to that point. It's not simply a result of having a highly valued currency. There are more important factors, including a high level of production and a need to produce (ours was routinely war related), wide-spread education even in trade fields, and a means of enforcing trade agreements. Arguably the Chinese have the ability to leverage their economy to their advantage when it comes to negotiating trade disputes; however, the other two facets they would find themselves lacking.

The middle class was created in this country in the late 1800s, when gold was money, prices fell some 25% over the last 30 years of the decade. It was created when steel production was revolutionized, when electricity was invented, when the assembly line was developed, etc. When we developed the capital goods that made American workers productive, their work made everyone wealthier. That couldn't have happened if the U.S. was on paper money with the government printing at will. All of the money that was invested into those capital goods would have gone into machines of war and stocks and home mortgages and whatever bubbles the government would have created at the time. The issue isn't the status of having a strong currency. It is the consequences of debasing the currency.

No it doesn't. It's not even remotely close. China is an impoverished nation for the majority of its citizens. By no means whatsoever could you say the same about the United States. While there is a great consolidation of wealth in America, it is much worse in China.

Ok, we are definitely moving in their direction. Give it 20 more years.

No it wouldn't. It would cause massive economic upheaval for the Chinese. Their currency changing value would cause extreme unemployment, which in turn would cause drastically lower demand for Chinese goods, ultimately lowering prices and revenues, etc etc. For the Chinese, it would be the equivalent to the Great Depression. I see how that could redistribute wealth in itself. Most economic disasters only hurt the individuals who weren't prepared for them, and generally speaking, that's the lower classes. People who are also dependent upon the massive government systems in China would be the most hurt.

There would certainly be an adjustment for all of the banks that made their passing around monopoly money, and people would be unemployed until the economy sorted out where they needed to be. Of course it is entirely possible, even probable, that the Chinese government would step in and drag out the problem and create a depression like we do here. That still doesn't mean the end result wouldn't be better than what they have now. If all of the wealth their factories produce were available to the everyday person, of course their lives would be much better.

As for your comment about economic disasters, deflationary busts are the cure for the concentration of wealth in the hands of the ruling class. Look at the 1920s. Money printing fueled the stock bubble, income inequality was at an all time high, the bubble burst, the banks failed, prices crashed. So the bankers lose everything and the peasants like you and me can buy twice as much for the same money as we could before.

I'll get to the rest later.

 

[KCOTT]

Don't have time to read all of this. Can someone answer this.....Are we going to die?

most likely, but it won't be by north korea

 

[JDeezy]

Look at the 1920s. Money printing fueled the stock bubble, income inequality was at an all time high, the bubble burst, the banks failed, prices crashed. So the bankers lose everything and the peasants like you and me can buy twice as much for the same money as we could before.
.

My grandmother grew up under a chicken coop eating beans from a can. Personally, I'd rather not have another depression.

 

[OptimusPrime]

My grandmother grew up under a chicken coop eating beans from a can. Personally, I'd rather not have another depression.

You'll be getting one whether you want it or not. It would have been much better for us all if they just got out of the way and let it happen. It would have been over years ago and we would have some real economic growth again. Instead they are just blowing this thing up so big that when it bursts we are fucked. People were able to eat in the Great Depression when prices crashed, at least until the government started burning food to keep prices from falling any more. If they destroy our money fucking around, you won't be eating anything but paper dollars. Those canned beans will taste pretty good.

 

[OptimusPrime]

One thing I didn't see mentioned in the debate above. The loss of exports to foriegn countries can't just be replaced by selling the same goods to Chinese consumers because a significant chunk of those exports are manufacturing products for foreign countries. How would they replace all of those lost jobs when worldwide demand for those products wouldn't disappear because they got manufactured in another country. Even if you ignore the issue of countries boycotting china in a dispute with the US, some other country would get those exports and china would lose them.

If China dumps the dollar, the rest of the world will too. No one will be exporting anything to us unless we pay them in gold bars.

 

[OptimusPrime]

First, that assumes that China would have the revenue to import goods. Why would Chinese consumers not be effected by "prices bottoming out?" More likely than not Chinese imports would be reduced, rather than increased, as a result of a higher level of unemployment.

Any unemployment would be temporary while they restructured the economy. They don't need to import anyway, they can produce everything they need.

Second, by the Chinese starting a trade war with the United States, it is unlikely they would find many willing trade partners. Free trade benefits the Chinese economy far more than it benefits the economies in the West. While we're provided with cheap goods, we pay for it with generally higher unemployment; whereas, if the Chinese stopped exporting goods to the United States, they would have almost no sustainable workforce. To suggest that a Chinese consumer will instantly replace an American one presupposes there would be no period of time in-between for an economic correction, and that's putting it mildly.

Their current trade partners wouldn't be going anywhere. They are already making deals with Brazil and Russia and India to do business outside of the dollar. The economies of the West are finished anyway.

Free trade benefits everyone. And we have certainly benefited more than they have from the arrangement. What wealth we have left is almost exclusively from it. If we had to build iphones and tvs and computers here, we would just be building them for the ruling class, because we wouldn't be able to afford them. It's like saying each household should cut off trade with everyone else. Then every household would sure have full employment, growing food and knitting clothes and whatnot, but they would be poor as dirt. Unemployment here has nothing to do with what they produce over there. There are plenty of other jobs to be done here if the government would allow it.

1. 100 years ago most countries used the gold standard. Different scenario.

We didn't have a problem exporting 50 years ago either, when countries accepted dollars instead of gold. Since Nixon closed the gold window the dollar has steadily crashed while our trade deficit has steadily risen.

2. You're assuming, again, that there is no effect to deflation, when in fact the scenario you describe would likely lead to a Chinese depression. You can't simply drop prices, increase unemployment, kill exports, and expect 20-25% of the population of a country to pick up almost $10T in revenue. The vast majority of Chinese GDP comes from external sources. There is no feasible means for China to replicate that internally. What you're describing would be suicide for the Chinese.

Exports wouldn't crash except to us. After a correction, as long as their government doesn't screw things up, the lower prices would be a boon to Chinese consumers and their economy would be healthier than it has ever been.

All I'm trying to demonstrate is that currency is not the only driving force of an economy. China does not have the infrastructure to erect a consumerist economy because they do not have a self-sustaining middle class, nor will they have in the foreseeable future.

You are right that currency is not the only driving force. If their government decided to model itself after us and strangle and regulate every aspect of business there, then the money won't matter a whole lot. But money is one half of every transaction and more important than any mainstream economist will ever admit to or realize.

But the United States is still the chief production power in the world when it comes to unique goods and services. The Chinese are manufacturers of others goods, but that doesn't mean they are an economic powerhouse. The differences between our economies are vast, and I think you overestimate the strength of their economy. It's a booming economy to invest in, if you're a manufacturer looking to outsource, but that doesn't mean their economy is strong; in fact, I would argue that's what makes the Chinese so controllable.

As I've said before, their economy is propped up by the globalists in order to make money. When 66% of your GDP is from foreign companies (which could be turned off like a faucet), you are not in control of your own destiny.

The only thing the U.S. is a power in producing is machines of war, which makes sense because killing people is all governments know, and there is no private economy here anymore. China isn't some paradise, but they have factories capable of producing consumer goods, which is a lot more capital infrastructure than we have left, and that is all you need. You severely overestimate the strength of our economy. It is smoke and mirrors, not at all an economic powerhouse.