>The economic "fundamentals" all over Asia are down in the pits and will
stay there until after the inevitable, yet incredibly resilient,
deflationary boom on Wall Street. The reason is that the "fundamentals" of
the Asian economies had been predicated on a trade/finance globalization
regime that hit a killer reef in 1997. Wall Street is living on borrowed
time from two sources:
1) from the repatriated flight capital from Asia, and
2) from borrowing future investment in the high tech sector.
I am not sure whether I properly grasped the context of Jiang's statement first time round. Should I understand from your comments that China as a whole does not have much to fear from Soros, but that Hong Kong remains vulnerable to raiders in one form or other, and Jiang at this reception for Hong Kong representatives, was publically demonstrating that China as a whole would try to extend a protective shield to Hong Kong at least by warning raiders on Hong Kong that they would suffer financial consequences to their other interests in the whole of China?
On the wider issue, the "fundamentals" (and for this we might need to change the thread title) I took you to argue that China is not particularly vulnerable to devaluation or to a reduction of inward investment, and that by contrast it is the US that is vulnerable.
The problem is why is the US economy "incredibly" resilient?
I am afraid I have a different scenario.
Taking the term "a trade/finance globalization regime" and translating it back into marxist concepts (perhaps in a somewhat amateur way) I assume we are talking about a global capitalist system including circulating and accumulated capital. I always try to think of how the figures correspond to some real underlying value, in the marxist sense, although the gross figures may fluctuate above the "true" total value or below it for a number of reasons including the phase of the capitalist cycle.
Now this global trade-finance capitalist system is very unequal, and when it reaches the peak of its global cycle, it is the vulnerable areas of capital that suffer the hits and are destroyed (remember in the Communist Manifesto Marx states that the destruction of a portion of capital is one of the ways the system gets out of the crisis the other is by conquering new markets - although they did not mention high tech specifically!).
I therefore suggest that the world capitalist system has restabilised by a shift in the relative proportion of capital accumulated from Asia to the USA, and the system will now be able to continue relatively smoothly for some time with the USA and to some extent Europe enjoying the benefits of their relatively stengthened position.
As you may gather, I am looking for serious counter-arguments.
Chris Burford
London