"In order to protect its own economy, the United States fully used the US dollar banknote printing machine during the epidemic. As a result, the world has now tasted the bitter fruit brought by the United States." Russian President Putin said.
The current serious inflation in the United States and high stock floatation have already reflected the serious consequences of US money printing. Unlike politics, the economy is the same for all countries in the world. From a financial point of view, all countries are in the same boat as the United States. Once the United States is affected, it is difficult for other countries to survive. Which countries are most affected by the US economic crisis? What is China's position in this crisis?
Great inflation in the United States has spread to the world!
As we all know, the U.S. dollar occupies an important position in the world. In the current international market transactions, more than half of the countries use the U.S. dollar, and this has an inseparable relationship with the prosperous economy of the United States. In other words, if the U.S. economy can continue to flourish, the US dollar’s position in the economic market cannot be shaken. However, things have recently reversed.
After U.S. President Biden took office, he announced the launch of a number of projects with an investment of more than one trillion yuan. In order to be able to complete these projects and also to solve the impact of the epidemic, the U.S. government began to print money without restraint, and a large amount of money The influx of funds into the US economic market caused chaos in the market and inflation.
According to data released by the US Department of Commerce, after excluding the volatile food and energy prices, the US core personal consumption expenditure (PCE) price index rose by 3.5% year-on-year in June, the largest year-on-year increase in the past 20 years. The consumer price index (CPI) is the biggest increase in 13 years.
Not only that, as early as the first half of this year, the price of food and fuel in the United States had begun to rise rapidly, and it even affected the normal life of the American people at one time.
How long will the crisis caused by inflation last? The U.S. Reserve Bank said that the inflation will not last long. But with the fluctuation of the US economy, the outside world began to have doubts about this.
On August 1, the White House officially announced that Congress had refused to continue borrowing because the debt ceiling had expired. At present, the remaining balance of the US Department of Finance can only be supported until about mid-September. As soon as the news came out, the economic market, which was already severely affected by inflation, was hit even more. At the same time, the U.S. dollar was also affected to a certain extent. Many experts believe that the inflation will not end in a short time, and it may even be affected. To other countries.
Relevant researchers analyzed the current inflation and believe that the US inflation will not only affect the country’s economic recovery, but also have a negative impact on the world’s economic structure. In order to tide over this crisis, domestic companies are bound to do so. Increasing product prices is equivalent to importing inflation abroad.
Experts pointed out that if the Fed still cannot solve the crisis, it may even raise interest rates to respond, which may cause a shift in global capital flows, leading to emerging economies and financially fragile countries facing the risk of financial crises. The development of the matter is just as predicted by experts, and more and more countries are affected.
South Korea and India "cry a lot of bitterness"!
According to relevant data, in the second quarter of this year, South Korea’s “dining table prices” rose to a record high in the past 10 years, and many Koreans directly called “life difficult”. In July, the price of agricultural, livestock and aquatic products in South Korea increased by 9.7% year-on-year. The watermelon, which has been nicknamed by netizens that ordinary people cannot afford to eat, has now risen to 30,000 won per piece (about 170-226 yuan per piece). The increase in the price of eggs in South Korea reached 57%, a four-year high. The price of 15 eggs was as high as 9,000 won per box (about 50 yuan per box).
With such a high price, many Korean netizens have complained about it. If this situation continues, it is very likely that they will not even be able to eat kimchi in the future. Some experts believe that becoming a developed country has also lost part of the "asylum" of the United Nations, and that South Korea is likely to be in greater danger during the financial crisis.
Seeing this, some people may wonder, how can South Korea become a developed country? In fact, South Korea has just been recognized as a developed country by the United Nations not long ago. This is also the first country whose international status has been changed since the 1960s. It can also be seen that South Korea’s domestic economic development cannot be underestimated. Reach the top ten in GDP.
Of course, this does not mean that South Korea's economic strength has far surpassed most countries. Most of its domestic food needs to be imported. Domestic people earn more and spend more. We all know that South Korea has less land and is not suitable for growing a large number of agricultural products. This has also resulted in the fact that most of the food in South Korea is imported from abroad, and the main trading currency is the US dollar.
Even with rising global inflation and high international food prices, South Korea has to import high-priced food.
Nowadays, the exchange rate of the U.S. dollar is also declining. This has led to the fact that under the influence of the spread of inflation in the United States, South Korea has become the "cannon fodder" under the US currency printing. Of course, not only South Korea, but India, another US "ally," has also suffered a great blow.
Up to now, the epidemic in India has not been controlled, and more than 200 mutated viruses have been found in India. The direct impact of the serious epidemic is that more and more factories have stopped production, causing the number of unemployed to rise, and more and more things need to be imported. , The necessities of life also began to rise in price.
According to official data released by India, the prices of liquefied gas and milk that the people most need are rising, and the vast majority of the people have lost their sources of income. Under such a double attack, the lives of the Indians are now in dire straits. , Suffering beyond words. As a result, the whole of India may even suffer a huge hit from this inflation.
There is also worse news. According to data released by the Central Bank of India in April, India’s external debt has increased to 558.5 billion U.S. dollars. If the debts of various states and states are added, India’s total public debt has reached 1.17 trillion U.S. dollars. , Accounting for about 250% of foreign reserves.
Economists believe that the current Indian economy is in the most urgent situation in 25 years. If India is unable to tide over this crisis, the economy may face a 25-year setback, and there may even be the risk of a recession back to its original shape.
At this point, many people may start to worry about whether China will be affected by this US inflation? Why don’t we feel any changes in our daily lives? Next, let us analyze in detail.
Why can China stand alone?
During the epidemic, my country was the only country with sustained and positive economic development. During this period, many foreign capitalists saw the great development of China, and more and more companies chose to invest in China. At present, the Chinese economy is very stable. Of course, this does not guarantee that we will not be affected by this inflation, so how do we ensure that we are alone in such a situation? This also starts during the epidemic.
During this epidemic, our country performed very well, not only helping many countries provide epidemic prevention materials, but also actively cooperating with epidemic prevention work and sharing epidemic prevention knowledge. This series of performances not only allowed other countries to see my country's demeanor as a major country, but also showed my country's strength in the rapid recovery of the economy after the epidemic.
This is also a direct result of the continuous improvement of the renminbi’s international status. Although the current exchange rate has not changed much, the strength of the renminbi is already a growth when the dollar exchange rate continues to fall. Moreover, most of our daily necessities can be self-sufficient, so there is no imported inflation, and losses are minimized from the root cause.
Of course, for ordinary people, we can understand the economic crisis from the four aspects of food, clothing, housing and transportation.
At the beginning of the outbreak of the epidemic last year, my country's food products suffered severe turbulence. A series of foods such as pork, vegetables, eggs, etc., appeared a lot of "looting" scenes across the country, and even supermarkets in some places were emptied. At that time, the relevant person in charge of the country publicly stated that our country's supply is very sufficient, and all the country's grain reserves are open, so that all the people can eat for two years without any problem.
And this year, the price of pork has been declining everywhere, and even in some areas it has reached seven or eight yuan a catty. At the same time, with the decline in pork, the price of beef and mutton has also begun to drop, and the prices of vegetables and eggs have gradually fallen to a stable level. From the perspective of food, we don’t have to worry about inflation causing us to be unable to eat.
In recent years, my country's housing prices have risen rapidly, especially after the emergence of the concept of housing in school districts. People are worried that housing prices will continue to rise. They have chosen to borrow to buy houses. Many people have been forced to become "house slaves." The government is also well aware of the dangers of the continued rise in housing prices. At present, local governments at all levels across the country have introduced various regulatory measures to suppress the false fire of housing prices. Although it is impossible for house prices to drop significantly now, we believe that house prices will stabilize in the future.
As for clothing and transportation, we don’t need to worry about it. Let’s not say that more and more new energy vehicles have appeared in recent years. Not only are they environmentally friendly, they are also very cheap. Shared bicycles on the roadside are enough for people. Daily travel. However, many regions such as Xinjiang are rich in cotton, so there is no need to worry about the problem of wearing them. It can be said that today's China has greatly ensured the daily lives of the masses in terms of food, clothing, housing and transportation.
Of course, this does not mean that my country will not be affected by the current US economic crisis. Generally speaking, all countries in the world are still on the same boat in terms of finance. my country’s main imported products are currently more or less affected. Oil prices have risen 9 times in a row in 2021, and some people even predict that by the end of this year, 98 gasoline will enter the 10th era.
It can also be seen that the current US economic crisis has also had a certain impact on China. Although we have not ushered in great inflation, this danger still exists. We must be prepared for the possible future inflation. At the same time, we must also be prepared for the United States' "broken jars".
The United States has been trying to push the blame for the epidemic on China. Former US President Trump has even publicly asked China to compensate US$10 trillion for the new crown epidemic. The first step is to clear all US Treasuries.
The United States now not only intends to push the epidemic to China, but also wants to blame China for inflation. The American media even put forward the so-called "China exporting inflation theory."
They used China's important position in global factories and the price transmission of Chinese exports as reasons. They wanted to explain in this way that the inflationary pressure faced by the United States and other countries did not come from the United States. They once wanted to make China take the blame.
This absurd theory put forward by the American media is totally unable to hold a foothold. Not to mention that other countries do not believe it. I think the US government is embarrassed to admit this point of view.
First, the increase in commodity prices in various countries is more due to the contradiction between supply and demand caused by the epidemic, and the increase in prices of housing prices and food has nothing to do with China; second, after China joined the global trading system, it has been exporting affordable products to countries around the world. It has provided a great help for economic stability; lastly and most importantly, compared with the United States’ zero interest rate, unlimited quantitative easing and large-scale fiscal stimulus, China’s fiscal and monetary policies are more restrained and cautious.
A well-known French scholar once said: “Greedness is like a tie, which tightens people up, and as a result, blocks reason”. The United States suffered an economic crisis during the epidemic. In order to preserve the face of the so-called great power and restore the domestic economy as soon as possible, it is also for the sake of Proving that the US is far superior to China, the Biden administration printed banknotes unrestrainedly, which eventually led to tragedy.
Can you say that the US government has never thought about the possible consequences of excessive printing of money? It's absolutely impossible, but they still did it. They can only say that greed created such a result. The United States is indeed one of the largest powers in the world, and its impact on other countries cannot be ignored, but this is not the reason for the presumptuousness of the United States. I hope that the Biden administration can correctly recognize its mistakes.