- 2024-09-09
- News
A-Share Market Declines: A Final Dress Rehearsal for the U.S. Financial Crisis?
A-share market plummets, causing unease in people's hearts. Is this the final dress rehearsal before the US financial crisis? The US dollar, as the core of the global monetary system, is facing unprecedented challenges. How long can global capital continue to flow towards the US?
Meanwhile, discussions about incorporating cryptocurrencies into the US dollar system are intensifying, and the possibility of gold gradually decoupling from the US dollar has also attracted widespread attention. Amidst the backdrop of an emerging "anchorless era," we may once again witness history. In the face of economic turmoil, how should ordinary people deal with this risk?
Has the US become a black hole for capital attraction?
Recently, the financial market has been as lively as a festival, with the US dollar and Bitcoin soaring on one side, while gold is "against the trend" and has risen by nearly 6% in just one week.
What's more puzzling is that it has not only stirred the market but also become related to cryptocurrencies, with plans to establish a White House position to support this industry.
You should know that he has never been optimistic about cryptocurrencies before. Now, such a turn is indeed intriguing.
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Looking at last week's market performance, the strong rise in gold is impressive.
The market opened on Monday with a strong bullish candlestick, and another one on Friday. The buyers were quite determined, as if they were buying cabbages.
If we say that last week's surge in gold was a rebound, I would rather think that the decline at the beginning of the month was more like a nap.
But the question is, who has the courage to invest heavily in gold against the pressure of the US dollar and Bitcoin?
This strong buying force has made this round of increases not seen as a simple "rebound," but as a continuation of the trend after a brief fall.
Gold has always been negatively correlated with the US dollar and US Treasury yields. This fluctuation may imply potential risks in US dollar assets.
Last week, the US dollar index broke through the 108 mark, setting a new high for nearly two years. This strong US dollar has affected non-US assets such as China's A-share market. Large-cap stocks represented by the Shanghai Stock Exchange 50 were heavily sold by foreign capital.
The reason is simple: after the appreciation of the US dollar, US dollar-denominated assets become more attractive, and foreign capital withdraws from A-shares to pursue US dollar assets.
This capital outflow has triggered a series of selling emotions. Foreign capital withdraws, speculative capital and retail investors follow suit, and together they sell off, eventually leading to a collapse of market confidence, with everyone paying the bill.
US stocks, the US dollar, and Bitcoin are all going crazy. The US seems to have become a black hole for capital attraction, with funds from other markets flowing towards the US.
China was originally a valuation lowland in the global capital market, a good opportunity to attract foreign capital, but now it has been deviated by this "Xixing Dafa".
The question is whether the global capital inflow into the US can last, which is expected to be answered in the coming months.
Is the rapid rise of the US dollar the ultimate manifestation of asset bubbles, or a harbinger of broader economic changes? People are eagerly waiting for the answer to be revealed.
US Offloading Debt Risk
When it comes to the current tactics the US is using against us, many people's anger flares up, thinking: "Why not just fight it out with them!" But if Japan were to do the same, that thought would be fine.
But the US, no matter how weak, the global order anchored by it is still deeply rooted in people's hearts, because the scale of foreign US debt increased in September.
So, anyone who directly confronts US hegemony now is making an unwise choice. The third part discusses this issue in detail.
Free trade, liberalism, market economy, these terms are still the main consensus of many countries around the world today.
What people are dissatisfied with is that the US sets its own rules, but why doesn't it follow them? But no one says that these rules are nonsense.
Look at the US debt, it's soaring,已经超过36 trillion US dollars, and the interest alone costs more than a trillion a year.
This is really worrying!
Interest rate cuts? The US needs to think carefully.
The Federal Reserve may still want to drag it out, but the problem will eventually explode.
The US is well aware that to repay its debts, it either needs to save money or heavily tax, but neither path is easy, and no one wants to take the blame.
So, the US has started playing the "snowball game," printing dollars and spreading them out, wanting the whole world to share the risk.
The US dollar was originally tied to gold, then pegged to oil, and now the petrodollar is not working either. The US is eager to find a new "backer," and Bitcoin has been targeted.
The matter of Bitcoin is not just a carnival for hackers and speculators anymore; it is backed by Wall Street, national bigwigs, and even a sign of a major global financial reshuffling.
But then again, can Bitcoin really become the new gold that the whole world recognizes? That's really hard to say.
New order rules still need to be explored
Now in this world, the old rules have not fully exited the stage, and new ways of playing are still being explored. If someone is eager to kick the US out of the way and take over, they will inevitably be targeted by the whole world.
After all, every country has its own calculations, small countries hoping to make some extra money, and it's not surprising that the US plays dirty tricks. If China takes the lead at this time, isn't it just handing a knife to others?
For now, we need to do some practical things, such as gradually reducing the US dollar and US debt, and accumulating more gold, which is the real guarantee of gold and silver.
This method will not be seen as a blatant challenge, but can quietly increase its weight in the global economic order.
After all, the US's financial hegemony is still strong, and the cost of a direct confrontation is too high. It's better to use time to wear it down.
From historical experience, every time technology and economy enter the tail end of the "innovation cycle," it will cause huge turmoil.
World War II, the Cold War, these are all related to the end stage of the innovation cycle. To live well in such times, one must reduce internal friction and remain rational.
After all, such global shocks may be the most significant historical period of our lives, and we may even encounter them more than once. We may witness history again.
The smart approach is to take advantage of the opportunities in the overall situation and focus on one's own affairs. Just like what China is doing now, gradually strengthening its power without acting rashly.
For us ordinary people, the key is how to understand and adapt, which is the king's way of survival.
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