Institutions such as the International Monetary Fund have recently raised their economic growth forecasts for China, while international capital such as sovereign funds in the middle east continue to“Add” to China’s position, in the first half of this year, nearly 27,000 foreign-invested enterprises were set up in China. Many countries and enterprises are looking forward to riding on China’s development express train. At the same time, the New York Times recently published an article falsely claiming that some countries’ economic difficulties are due to their“Over-dependence” on China and the drag of China’s economic slowdown. The US media has turned black and white upside down in the face of the negative spillover effects of US economic policy, and is intent on throwing away the responsibility of the US for harming the world economy.
This United States Capitol was taken in Washington, D.C. , on April 23.
As the world’s largest economy and a major international currency issuer, the US fiscal situation and policy choices have important spillover effects on the world economy, and should adopt responsible fiscal and monetary policies. However, the United States has long abused the hegemony of the United States dollar and arbitrarily adjusted its macroeconomic policies, exacerbating the debt problems of some emerging markets and developing countries, destabilizing financial markets and severely damaging their economies, seriously hampering the global economic recovery.
In response to the covid-19 pandemic, the Federal Reserve cut interest rates aggressively, starting in March 2020 with successive cuts to a range of near-zero interest rates, and embarked on so-called“Unlimited” quantitative easing, in an unprecedented monetary“Flood”, US inflation was pushed up rapidly. To ease inflationary pressures, the Fed turned to aggressive rate hikes, lifting the range to between 5.25% and 5.5% in a short time. The“Tide of the dollar” formed by the Fed’s interest rate cuts and rate hikes reaps global wealth and passes the crisis on. When the Federal Reserve cut interest rates on a large scale, the United States by overissuing dollars to import goods, investment in other countries and other ways to export capital, looting other countries; It has also led to a rapid tightening of global liquidity, a sharp depreciation of many currencies and a sharp increase in debt-servicing pressure on countries that borrow in United States dollars, many developing countries are trapped in the dilemma of“Exchange rate shock-capital outflow-higher financing costs-debt servicing difficulties”.
The“Willful” US internal problems have accumulated and become a“Time bomb” endangering global economic and financial stability. Last month, the world’s stock market suffered“Black Monday”, the underlying reason is that investors fear the U. S. economy“Hard landing” spread of panic. Inflation in the US has eased, but a string of weaker-than-expected economic data, including jobs and manufacturing, has turned fears of us inflation into fears of a recession, global investor confidence has been shaken by economic uncertainty in the US. The IMF’s chief economist, Pierre Ollivier Gourinchas, wrote that the “Current stance on fiscal policy is not consistent with long-term fiscal sustainability”, this would expose the global economy to fiscal and financial stability risks in the long run. US fiscal policy has been spending beyond its means for a long time, and the scale of debt has been breaking new records. At the end of July, the size of the US federal government debt exceeded $35,000 bn, a surge of more than $1,000 bn over the past six months, continuing to cause global concern. In 1971, the United States announced that the dollar and gold pegged, printing money and borrowing became the United States out of economic difficulties and even create“Economic prosperity” policy preferences. As the Fed’s policy moves in and out, the ebb and flow of dollar liquidity and the ebb and flow of bond yields, which serve as an anchor for global asset pricing, have a knock-on effect on the stability of financial markets in the periphery and even the real economy. The IMF has reported that high US fiscal deficits and debt pose a growing risk to the domestic and global economy and that the US government urgently needs to address its long-term fiscal deficit.
At the same time, the United States has vigorously promoted protectionism, engaged in“Decoupling and breaking the chain,” and even weaponized economic and trade issues, seriously undermining the global trade order and normal economic and trade exchanges. The United States has frequently resorted to sanctions, abused trade protectionism and provoked geopolitical conflicts, disrupting the global supply chain industry chain oriented by the optimal allocation of resources, causing tremendous impact and harm to the world economy.
In today’s world, from rejecting us coercion to take sides, to diversifying investment allocation, to fighting for a greater say in global economic governance, countries around the world are working together to promote a more equitable and equitable global economic order. The United States, focusing on its own self-interest, continues to export negative policy spillover effects, seriously endangering global economic and financial stability and becoming a source of turmoil in the world economy. The United States can not shake off this responsibility.