Opportunities from the struggle between the United States and China, according to economists

Chinese authorities are promoting the use of the yuan worldwide, and the US dollar dominates global trading.

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Beijing — Regarding the investment outlook, one Chinese economist predicts that a once-in-a-century opportunity will emerge from a “hegemony battle” between the United States and China.

Liu Yu Hui, head of the financial research division of the Chinese Academy of Social Sciences’ government think tank, said the groundbreaking window came from a cataclysm on both sides.

China aims to be a great country, but he said the United States has embarked on a dollar printing policy since the coronavirus pandemic that changed the fiscal balance.

This is due to the CNBC translation of his Mandarin speech entitled “The Polar World Under the US Dollar Super-Expansion Cycle-The” Cognitive Revolution “of China’s Capital Markets.”

Liu, Chief Economist at Tianfeng Securities, spoke at the Investment Strategy Conference of asset management firm China AMC on Friday. Founded in 1998, China AMC is one of the largest investment trust managers in the country with assets under management of 1.54 trillion yuan ($ 240.63 billion).

In Liu’s view, the United States implements the concept of “Modern Monetary Theory” (MMT). This means that governments with strong currencies can print money to support the domestic economy without worrying too much about budget deficits.

One of the most famous supporters of modern monetary theory Stephanie Kelton, Former Democratic Chief Economist About the US Senate Budget Committee and Bernie Sanders’ Senior Economic Advisor for the 2016 Presidential Election.

The United States under the Trump administration and the subsequent Biden administration maintained low interest rates, Released trillions of dollars into the economy To support growth after a pandemic.

The stimulus program has been criticized for its scale. At the annual Berkshire Hathaway conglomerate meeting in May, Charlie Munger, a longtime business partner of U.S. billionaire Warren Buffett, said modern monetary theory “may be more feasible than anyone thought. No, “he said. If you keep doing it unlimitedly, it will be a disaster. “

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On the other hand, in China, the ruling is Chinese Communist Party has just celebrated its 100th anniversary July 1, Xi Jinping President again China’s “great rejuvenation”.

For Mr Liu, the government’s stance means that policy will focus on ensuring national security and reducing carbon emissions. He emphasized that political correctness will become even more important for investment in light of the controversial speech of Alibaba founder Jack Ma last fall and the subsequent suspension of Ant Group’s IPO. ..

Mainland China’s stocks, which are most likely to make significant profits, will be, among other things, stocks in the new energy, seed, optics and semiconductor industries, Liu said.

Liu also geopolitically cast on digital currencies that Chinese authorities have tightened crackdowns this year.

“In my view, it’s just a US way to seduce the Chinese capital,” he said.

Opportunities from the struggle between the United States and China, according to economists

Source link Opportunities from the struggle between the United States and China, according to economists

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