China: Next Superpower?
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Camillus
Critical Thinker
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I've read a couple of articles recently (sorry I can't remember where) that have suggested that one way that China could exert a hold over the US is by threatening to buy its oil in Euros (or some other non-dollar currency).
The suggestion seems to be that a big switch from the dollar to the Euro (either by oil producers or large oil consumers) would cripple the US economy by causing massive devaluation of the dollar on the world markets while at the same time causing investors to abandon the dollar as investment.
Now I'm not an economist so I'd be curious about whether this is a viable scenario and what the consequences would be.
The suggestion seems to be that a big switch from the dollar to the Euro (either by oil producers or large oil consumers) would cripple the US economy by causing massive devaluation of the dollar on the world markets while at the same time causing investors to abandon the dollar as investment.
Now I'm not an economist so I'd be curious about whether this is a viable scenario and what the consequences would be.