The economic decline of the United States will lead to a regressive shift in its hegemony over the next decade. This decline is fueled by widespread disenchantment with the establishment within the United States and among its allies. The imminent power shift towards Asia will accelerate this decline.
One of the most concerning scenarios for the West would be if China and India were to initiate a process of alignment and economic integration. In such a scenario, demand and supply would remain confined to the region, rendering any unilateral economic or strategic threat from the Western Hemisphere fundamentally ineffective. This would herald a significant shift in power dynamics and reshape global power axes.
The unprecedented economic dominance and access to cheap money enjoyed by the United States post-2008 and the COVID-19 pandemic have led to an unsustainable deficit that cannot be indefinitely financed. Eventually, the domestic bond market will experience a reversal, signaling the beginning of the decline of the United States dollar’s preeminence.
The policies implemented by the Trump administration have left the global economic order in a state of profound disarray, potentially resulting in one of the following outcomes:
- Trade wars or regional instability.
- A fundamental reshuffling of the economic order.
- Absolute chaos in the region.
- Retaliation from China. China will exercise patience, waiting for the United States to initiate an attack before responding with a counterstrike. As Xi Jinping must demonstrate to his domestic audience that he is not succumbing to any perceived threats from the United States, all of these outcomes will be contingent upon the Chinese economy, which is in a state of self-destruction.
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