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THIS IS THE RESULT WHEN A COUNTRY LISTENS TO ECONOMIC HIT MEN TEACHING ITS LEADERS TO LIBERALIZE THEIR CAPITAL ACCOUNTS WHILE ALLOWING THEIR CURRENT ACCOUNT DEFICIT TO BALLOON - EXACTLY WHAT THEY ARE TEACHING CHINA'S LEADERS.|
At least China understands that it must be an international reserve currency in order to sustain such a rapacious system of parasitizing the world with. What China failed to understand is that it cannot issue enough Yuans as an international reserve currency to satisfy its needs under the IMF's SDR regime, which itself is less than 4% of all reserve currencies of the central banks of the world, and of which, China's quota cannot exceed 6% as a developing country, equating to a 0.24% share of the international reserve currency pool, an underachievement compared to its current share of 2.7% of the reserve currencies of the world without the benefit of being accepted by the IMF as a component of the SDR's it issues.
China's course of being the most cost-effective manufacturer of the world, due to its having the largest manpower resource, would have expanded its share of the reserve currencies of the world to 5% and thence 10%, 20%, and 30%, if it had persisted in the economic course set by Deng and the past administrations. Instead, it chose to artificially overvalue the Yuan by using up its foreign currency reserves to buy Yuans with, a total waste of China's hard earned dollars, which to makes matters worse, made all Chinese goods and services overpriced in dollars abroad and in yuans at home, resulting in the RECESSION HITTING THE MANUFACTURING SECTOR OF CHINA THAT IS THE GOOSE LAYING ITS GOLDEN EGGS.
China's economic team is the FOX in the chicken coop, and right now, the chicken are dwindling alarmingly in numbers. The latest Markit Manufacturing Index PMI for China is 49.4, which means CONTRACTION. Labor-related strikes are exponentially increasing too. It seems that corruption in China may no longer be endemic or epidemic, which can still be controlled, but rather it may be intrinsic at the core, and ineradicable.