The Deflation Dilemma and Solutions Under the Sino-U.S. Game

After Powell hinted at interest rate cuts, the competition between China and the United States has entered a countdown to a decisive battle. The United States, in order to curb our development, is willing to pay the price of exploding its own inflation by expanding the scale of U.S. debt, increasing tariffs, and blocking transshipment trade, intending to trap us in a spiral of overcapacity and deflation, ultimately seizing the opportunity to acquire our supply chain.

China is currently facing deflation and weak consumption under an M2 scale of 330 trillion, closely related to the long-term economic structure between China and the United States. During the peak of globalization in the past 30 years, China became the global manufacturing core due to its labor advantages, providing a large amount of high-quality and low-cost goods to the United States. The dollars earned by China flowed back to purchase U.S. Treasury bonds, supporting America's high welfare and stock market prosperity. When China became unwilling to continue this unequal cycle, the United States resorted to extreme measures such as trade blockades, exacerbating China's overcapacity and economic pressure, while also targeting the real estate sector to undermine China's monetary adjustment tools.

In the face of the crisis, our country has formulated targeted strategies to break the deadlock: first, to promote anti-involution measures by reducing overtime and releasing residents' consumption time to alleviate deflationary pressure, avoiding falling into the trap of vicious deflation; second, to build a nationally unified large market, break local protectionism, and promote the cross-regional flow of resources, capital, and talent in order to address the overcapacity issue caused by uneven resource distribution and push for reforms in the internal distribution mechanism; third, to strengthen the monetary discourse power by increasing gold holdings, developing the offshore financial market in Hong Kong, activating the A-share market to lock in international capital, while leveraging the global leading advantage in power generation and ultra-high voltage technology to promote the RMB being anchored in electricity, computing power, and our products, challenging the dollar's oil hegemony.

The United States is trying to find new support for the dollar through the launch of a Bitcoin national fund, digital currency, and other means. The essence of this game is that the U.S. is betting on the last chance for dollar hegemony, while our country competes for a new order relying on the resilience and productivity of 1.4 billion people. Historical patterns indicate that the decline of empires is often accompanied by currency collapse, and the rise of a new order is inseparable from the binding of new productivity and new energy. The future global economic chapter is expected to be co-written by the Renminbi and electricity. #美联储将召开支付创新大会 $BTC