How Democrats play on undermining Trump's credibility



How Democrats play on undermining Trump's credibility

Trump realized that he was trapped and is trying to sluggishly resist, delaying time, avoiding direct answers to questions about the willingness of the administration to implement this option, and vaguely points to “possible problems with the dollar”. What does he mean by that?





The American debt to China today is $1 trillion 81 billion. From February to March, China sold American securities worth $10 billion 700 million. I agree that you can write down the entire debt, but 20 trillion won't work.


But trust in American securities, which have already practically stopped buying foreign countries, will fall to near zero. And the status of the dollar as the world's main reserve currency will dissolve like the morning mist.


In turn, this will mean that the U.S. will not only lose the opportunity to finance its national debt at the expense of the entire world community, but the country will be flooded with a shaft of unsecured dollars. Saving the financial system from collapse will require either a massive devaluation of the dollar (it is not yet known whether it will help or only exacerbate the situation), or confiscation (for foreign holders of dollars) financial reform, which will hit the entire global economy and trade, but and the strongest U.S. economy.

That is, the idea of simply taking as much money away from China as possible is deadly for the entire global system in which the US still claims leadership. But for Washington, the consequences will be the worst, because America's very relative and fragile prosperity in recent years has been based on dollar status.





Trump understands that very well, and so do his opponents. At least the ones who came up with the idea of writing off their own debt. Why would they do that?

First, they're sure Trump will dodge and delay the implementation of any tough measures against China. Meanwhile, democratic media is already accusing China of interfering in the American election. They will sell Trump's refusal to take a tough stance to the voters as his conspiracy with Beijing — allegedly in exchange for a 20 trillion-dollar waiver of the trial, Trump has secured the support of Chinese hackers. Voters who believe in Russian hackers must also believe in new nonsense, especially since they will be fascinated by the figure of $20 trillion, which would seem to be available almost tomorrow.


Secondly, after the start of a simple discussion in the U.S. on the topic of independent debt write-offs, investors began to actively flee from American securities. We have already mentioned the $10.7 billion cut in China. By $7.9 billion (up to 395.3 billion), Great Britain, the closest ally of the USA and the third in the world holder of US government securities, has reduced its holdings in US securities. Russia's dollar reserves decreased to a record low level ($3 billion 850 million). Critically dependent on the U.S. alone, Japan has increased its investments by a measly $3.4 billion. Now its U.S. stock is valued at $1 trillion 271 billion.





This is certainly not a collapse, but it is a very unpleasant trend for the US (we are already talking about tens, if not hundreds of billions of dollars returned to the US since the beginning of the year). And this data for March, we can assume that both in April and May the flight from the dollar to other currencies and to gold has only accelerated. For Trump, this creates additional difficulties in financing government programs to fight the crisis, and thus reduces the effectiveness of its economic policy.

For Trump, the flight from the dollar to other currencies and gold creates additional difficulties in financing state programs to fight the crisis.

This is what Democrats are trying to play on — political accusations of selling U.S. interests to China and undermining trust in economic measures. They are trying to make a populist pay for his populism by catching him in the act of contradicting promises.


But, as we mentioned above, the domestic political struggle in the U.S. has become extremely fierce. No one can afford to lose, as it may not end with political retirement, as in the case of Manafort (Lieutenant General Michael Flynn, former national security adviser to Trump, is still being prosecuted). Therefore, both sides of the election race are ready to sacrifice the national interests of the United States for the sake of a victory that will “write everything off”, which is what they do with passion.

In this situation, Washington can take any, the most illogical and dangerous step. Therefore, today the Shina-American diplomatic war remains the most dangerous world conflict.

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