There is no doubt that the dollar debt crisis will definitely have an impact on the world economy, and China is naturally more complicated. As for whether it is a good thing or a bad thing, we should look at it comprehensively. If it is handled well, it will become an opportunity for China; if it is not handled well, it will cause an unparalleled blow to China's economy.
Say bad first.
First, the appreciation of the renminbi. Once the American debt crisis breaks out, the international currency, the US dollar, will inevitably depreciate sharply. Because the RMB exchange rate is tied to the US dollar for a long time, the RMB will definitely appreciate sharply against the US dollar and depreciate against all non-US dollar currencies (since trade, international oil prices and gold prices are all settled in US dollars). This is just one of them, and one of the major measures of the American rescue plan is to start printing money, and now it is implementing the zero interest rate policy, which will inevitably further appreciate the RMB against the US dollar and further depreciate it against other currencies.
Secondly, with the appreciation of the RMB against the US dollar, it will also lead to a sharp depreciation of the RMB, which will lead to inflation in China. The people of China will continue to suffer from low wages and high prices. There are two main sources of inflation. First, China's export-oriented economic strategy mainly depends on exports, so the trade surplus between China and the United States is huge. To put it bluntly, the dollar is more in and less out. Therefore, China has a lot of US dollars (3. 19 trillion), which is the data released in June this year, of which more than 60% is US dollars, which means at least 1. If the government wants to wash away the hot money, it needs the central bank to print 6.4 times RMB at the current exchange rate, making the real currency in circulation in China 20% higher than the nominal one. Secondly, as I said just now, since international trade, crude oil and gold prices are all settled in US dollars, the depreciation of the US dollar will inevitably lead to the increase in the prices of agricultural products and raw materials, and China will inevitably be affected by imported inflation.
At the same time, China's economy, which has long been driven by investment and exports, will also be affected by the decline in exports because of the appreciation of RMB. The rise in raw material prices alone will bring down a number of China export enterprises. Secondly, China's goods seize the international market mainly by China's cheap labor and price advantage. But now the appreciation of RMB will make China's export enterprises lose their only advantage. Therefore, the American debt crisis is a great test for China's export enterprises.
Moreover, China's fiscal contraction is inevitable. China not only has the world's largest foreign exchange reserves mainly in US dollars, which has exceeded 3 trillion at present, but also holds a considerable amount of US Treasury bonds. At this point, you need to understand the relationship between American currency and national debt. The dollar is a debt currency, so it is closely related to the national debt. A friend named wongsiewwei gave a good example about the relationship between US Treasury bonds and paper money issuance and the adjustment of debt quota by Congress. Let me explain briefly, you can fully understand that the national debt of the United States can be held by other countries at home and abroad except the United States. Generally speaking, the United States repurchases government bonds, that is, it is dissatisfied with the economy, increases its holdings of US dollars, and increases monetary liquidity (the US dollar index will rise), while issuing additional bonds is the opposite. The United States is now heavily in debt, but in order to make up the fiscal deficit and raise the debt ceiling, it still issues government bonds frequently. In fact, it is what we often say, borrowing new debts to pay off old debts. Children all know that living on food can only solve temporary needs but not real problems. In other words, if the United States continues to raise the debt ceiling, then when the debt accumulates to a certain extent, the crisis will naturally break out. Just like those countries in Europe now. As a friend named wongsiewwei said, the US government is basically unreliable, and issuing bonds has become a weapon for Republicans and Republicans against Obama and Democrats. People all over the world now see that there is a bickering in the US Congress, and their government is basically unreliable in restoring the global economy, so people in the financial industry, including the United States, have little confidence in economic recovery. This may become the signal of the second trough of the global economy. China is worried that this big American creditor won't get the money. It's as simple as that. The dollars we saved evaporated.
Of course, the US debt crisis is not without its positive side for China.
First, the appreciation of RMB forced China to change its current currency, especially its exchange rate policy. In addition, economic policies must also be adjusted. While attaching importance to exports, we must expand domestic demand, increase consumption and foreign investment. These cannot be just slogans. It's not enough to just talk and not do it.
At the same time, the appreciation of RMB means that the government's previous model of relying on cheap-money policy and China with low labor costs must end. I used to call for optimizing the industrial chain, which is an opportunity. The US debt crisis can make China's export enterprises reshuffle and eliminate some enterprises with no technical content and viability. Due to the low elasticity of demand price and high added value of products, high-tech industries will survive and occupy a place. In addition, compared with the past inland export enterprises, coastal export enterprises with comparative advantages will lose their advantages, which will also help the development of inland export enterprises. It is false to say that this reshuffle has not shaken China's economy, and many workers will lose their jobs and their hard-earned money, which may have been earned after years of struggle. But the positive purpose of shuffling itself is precisely to eliminate what should not be, which is the only process for any economy to develop at any time. Workers' hard-earned money is money, and taxpayers' money is money. In the past, export enterprises earned a lot of money, supported by ordinary people and taxpayers who paid inflation. We can't feed things that shouldn't exist with the strength of the whole country. Can you say this model is normal? So if China's export industry can really complete the transformation, it will be good for China and the export enterprises themselves.
Of course, if the government really wants to help those unemployed workers, it will sooner or later let them change careers and give them a raise.
In addition, in 2008, the subprime mortgage crisis in the United States triggered a global financial storm, and the China government also joined in the fun, offering a sum of "4 trillion yuan" called "bailout", although China became the second largest economy in the world in 2009, as if the world economy was "unique in scenery". But this is actually not what we want. "4 trillion" is only a rough figure given by the central bank. As a matter of fact, the amount of bailouts in China's provinces means that China's investment in this international financial storm will far exceed 4 trillion. The rescue measures made China lose the best opportunity to squeeze the bubble. Joining China, which released the bubble at that time, will be another situation today. Therefore, if the China administration is far-sighted, it can take advantage of the US debt crisis and become a good opportunity to release China's economic bubble.
For example, a good example is that the Japanese economy is similar to that of China in the 1980s, and it is also an export-oriented economy. However, just as the Japanese rejoiced and fantasized about surpassing the United States, a "Plaza Accord" from the United States dealt a heavy blow to Japan, and Japan's financial bubble was punctured, causing the stock market to plummet. Coupled with the subsequent Asia-Pacific financial crisis, the Japanese economy stepped down from the altar overnight and embarked on the road to recovery. It was not until the end of the Millennium and 200 1 that it barely recovered. In contrast, the economy of the United States in the 1990s was unprecedentedly prosperous under the leadership of two Bill Gates and Bill Clinton. However, it must be mentioned that Japan's economic transformation changed in the 1990s. It was in the 1990s that the Japanese began to integrate with the West, paying attention to domestic demand and consumption while attaching importance to exports, and at the same time expanding foreign investment. Moreover, it was in the 1990s that Japanese consumption habits and concepts changed, and they were in line with western countries. China can learn from the Japanese, which is a good opportunity for China to integrate into the international community.
To sum up, the US debt crisis is a great challenge to China, but it can also be an opportunity. Let's see if China people can plan ahead.
At the same time, the thinking concept of our government and ordinary people should also be changed to get out of the altar of GDP as soon as possible. Slow and sustained growth is more reliable than rapid growth. The government has given up the slogan of "eight guarantees", which is a good signal.