Xi Jinping, China's president, attends a meeting with Narendra Modi, India's prime minister, unseen, to sign a series of agreements between the two nations at Hyderabad House in New Delhi, India, on Thursday, Sept. 18, 2014. Modi won a pledge from Xi to invest $20 billion as the leaders sought to adjust a lopsided trade relationship and resolve a decades-long border dispute. Photographer Graham Crouch/Bloomberg via Getty Images

New Chinese Relations: Their President, Banks, Exports & Donald Trump

Thoughts while reading Fortune Magazine’s article on China’s Credit Binge  ….

  • Relations between the U.S. and China could be potentially disruptive
  • President-Elect Trump’s charges of currency manipulation by the Chinese to keep the yuan artificially low
  • A realization by economists now that the yuan may actually be overvalued
  • A weak global economy that cannot absorb a surge in Chinese exports
  • The revelation that China’s banks have been using a sleight of hand to keep $2 trillion in loans off their balance sheets to meet capital requirements (think of what led to the US recession of 2007-2009)
  • A pressing need for China to reign-in North Korean leader Kim Jong Un;
  • President-Elect Trump’s taking an unprecedented call from Taiwan’s President Tsai Ing-wen breaking diplomatic protocol
  • China’s response to the call (“Tricky”) that has left most befuddled
  • And finally this past week, the naming of long time personal friend of China’s president, Xi Jinping, Iowa Governor Terry Branstad as Ambassador to China

It will be interesting to see how this gets sorted out on the geopolitical stage. Chaos? Opportunity?

 

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Thomas M. Laorie is an entrepreneur specializing in medical technologies
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