there’s a theory out in the world, I think mostly among radlib economists, that the recession of 2008 has never ended, and we are in a decade-plus “long recession”. the core of the argument for this is that the solution for the recession, quantitative easing, was not only a band-aid that can only be used once, but also essentially putting the foundations of the economy on a sand pit that the federal reserve promised to keep filling forever.
quantitative easing is the printing of money to provide constant liquidity. liquidity is important because one consequence/ aspect of USamerican financial imperialism is denominating debts in US dollars. this means that most every country needs constant dollars to even service debt, let alone pay it off. one possible crisis of ‘08 was a massive, international run on the dollar because everyone needed to pay their debts. that’s why a lot of banks were affected by the crisis even if they didn’t actually own mortgage backed securities. this was avoided by printing a lot of money forever. this manifests in 0% interest loans, created from whole cloth by a central bank.
the Japanese central bank followed suit in policy, and the relative difference in value between the yen and the dollar has allowed for the ‘carry trade’. this is buying Japanese bonds at 0% interest, and then buying US Treasury bonds for the profit and the dollars. treasury bonds are separate from the federal reserve, so they aren’t a part of the 0% interest thing. so it’s true that some people, as you said, were scheming with this to make a profit, but many countries and foreign companies used the carry trade to generate dollars. the elimination of the carry trade is of some global significance, because dollars are that much harder to get if a country has a debt crisis. does this mean quantitative easing is over, or even under threat? no. but the system can’t last forever, and in the past the fed has shown that sometimes they make decisions for the stock market instead of long term financial imperialism.
nvidia announced that the next best AI chip was delayed for production snags, which led to some tech companies sliding. the intel stuff is worse than just a bad quarterly. they don’t make any AI chips, because they didn’t get involved in design a decade ago. the fabs they’re building in USamerica are all behind schedule or failing. every 13th and 14th generation CPU has a chance of having a computer ruining defect (i think they melt at certain temperatures/ length of use), and intel has chosen not offer a recall or a solution. arm holdings now makes better laptop and data center chips. they also laid off 15k people last week. the long and short of it is that they spent something like $150 billion on share buybacks in the last 30 years, and a lot less on research and factories. there’s a good chance intel gets splintered up and bought by various competitors or simply catastrophically fails in the next two years.
i agree with your position on deng and the current ‘frog boiling’. i think a major factor that will determine how that happens is china’s entanglement with the USamerican economy. while china is reducing its ownership of us debt, it still owns a lot. this means they are deeply invested in the US’ ability to make interest payments. the US can never stop servicing that debt, or else everyone in the world would panic and drop everything connected to the dollar. aadditionally, my understanding of china’s central banking policy is that they cannot force a financial economy to develop, so until that happens organically they are reliant on the west. the financial options the west offers are everything from bonds and other securities designed to absorb excess cash and return a profit to unique corporate structures that allow companies to headquarter different branches in different countries for maximum benefit. that’s the one hand.
on the other, it’s been more than ten years since the tpp and obama’s pivot to asia. in the eye of some warhawks, just as soon as the US can get out of SWANA, they’re going to be right at war in the indo-pacific. if the US continues its hot and cold attitude, then i’d guess china will maintain its current pace of reforms. if the US is humiliated in some major way, then Xi might be able to pull out the big red button at will. i don’t see a path to real aggression against china, but i think major surface fleets are defunct and that china has an overwhelming material edge in a conflict with the US that lasts longer than four days. those in charge of the boats and planes are cut from a different cloth, so they might try and do it. i think the two types of “war” against china that are on the table are either jumping from a broader middle eastern conflict to cut off oil shipments through the persian gulf and the strait of malacca, or boosting the phillipines into a south china sea provocation that calls in the whole regional gang. in the event that we are not all burned away in nuclear fire or its consequences, this ‘proxy’ war could allow china to nationalize industry for the war effort.
no matter what, i think the current pace of reforms is irreversible. there are changes in the world that could cause an acceleration of the reforms, but i can’t imagine how they’d be reversed. the material conditions of people in the urban areas of china that i know are getting to the be the best capitalism can give to a society. if capitalist development is no longer benefiting the people in china, then the communist party will phase them out. the fact the USamerican empire is sprawling outwards in a deathspasm at the same time is either happy coincidence or further proof of the immortal science.