geikei [none/use name]

Maybe im naive but the Trump administration, despite being staffed to the brim with insane China hawks, folding on its “anti-china economic warfare” before even starting it can be spinned into a more optimistic view on the prospects of hot US-China war. The murikans dont seem to have it in them. With the first sign of things getting tough, the US folded like a cheap tent. Just the prospect of things going to shit was enough. No prices have increased, nobody lost their job, nobody has been deprived of anything real. Some numbers on screens went up or down and the powers that be forced Trump’s hand. Even if instead of chaotic and incompetent it was some calculated and competent plan for a US-China clash, at some point most of these pressures and prospects would have arisen all the same and at the end of the day it wouldnt have much better chances to win against China. Will they really decide to destroy everything in a nuclear holocaust when the decision for a hot war is there when they couldnt even let the bond market freak out for more than 5 days ? Just as them losing the trade war (or at least not having the capacity to execute it without country breaking consequences) became obvious within days, the fact that they would lose any war close to China shores in 2028 or whenever will also sink in. Especially with the trajectory of both countries. It may still be possible to sustain that delusion in the big 2025 and rig war games to barely tie the engagement but its rapidly becoming less possible, especially after this whole debacle conlcudes

Since as far as i can tell China is still not selling UST and is holding it for the right momment, what if the chinese “plan” if all this continues is to wait as other UST holders keep this yield pressure on the bond market (since this situation continues pressuring asian-euro UST holding hedgefounds and BoJ given their currency and monetary state) then once the Fed is forced to do QE, China dumbs and exits USD. Inflation & rates would explode/ USD would devalue. US may not pay up or impose capital controls, but that means USD will lose GRC status

Im early on on my Mandarin journey but holy fuck is Mao accent thick as shit to the point of being almost unintelligible. Do modern Chinese understand everything he says without subs ?

Idk what to think but there are some utterly apocalyptic ideas floating from and around the administration and the surrounding hack economist and advisor sphere and they even get credible coverage and op-eds in mainstream financial publications and media in the last weeks. Especialy if things detariorate debt parameter wise , there is a Fed-administration crisis and/or the less insane Miran/Bessent plans A/B dont work or even have time to work. Stuff like the administration trying to unilateraly turn all US government bonds into 100 year bonds or taxing capital flows/capital controls. Can they be that suicidal towards the dollar hegemony?

And after all this the bond market is still doing its thing. 10 year yields up again and over 4.3%. Really started to set in on what trade war with China actualy means and the countries/investors remain shaky on if us dept is worth it. Maybe Trump did actualy break something

its not out of the question that the coordinated Japan-Korea-China response to tarrifs that was talked about was true and it was about strategicaly selling UST, fucking up the bond market and spooking Trump into caving

It was 100% the bond market, he even half-admitted it himself. And it wasnt even China doing it, more so Japan and non state actors it seems

The vast majority of chinese exports to the US arent even viable after a certain level of tarrifs. Maybe after 50%. Volumes will grind to a halt unless they can be redirected en mass through lower tarrif countries and the US even allows that

There were some 5d chess asumptions that a reason for Trump to purposely crash the markets is to be able to refinance the dept that matures in the next months (an immense amount, like 30% of total) with lower rates. But the 10 year yields have actualy been going up through the last week (rumors are that China dumped like 50 Billion in Treasuries, partly to resist pressure to depreciate the Yuan, partly to raise free cash for whatever stimulus they have coming up or to buy gold , partly because they see the writing of the wall for actual decoupling seeing Trump’s teams moves and maybe to actualy fuck Trump over) and of course the enviroment created by Tarrifs aint very conductive to that plan. Trump may be yelling that Powell has to cut rates but with these numbers its not immediately likely either. If Tarrifs stand and If the market crashes then China can continue and time its dumping to force Trump to use higher rate debt to replace lower rate debt or inflation shocks. Yeah i know MMT and printing and stuff and of course this scheme will go on for a bit and the US cannot default or anything but there are large negative consequences, political and economical, for marching on with much worse dept terms, especially in this global enviroment

Vietnam is one of the most if not the most exposed markets to Tarrifs and got hit with some of the highest rates and dont have many levers of counter pressure.For a country like Vietnam this shit is pretty apocalyptic so their response would always would have been meek at best. You cant extrapolate general response cause its THE extreme case and nothing even happened yet