As China has become more and more influential in the financial market, its goal behind this dominance is not that simple. James Gorrise, an expert about China and the author of The China Crisis, points out the Chinese regime’s ambition to dominate the world via the financial industry.
The value of Chinese stocks has plummeted in U.S. markets.
As stricter U.S. regulations took effect last year, it exposed many Chinese companies’ weaknesses and fraudulent practices. As a result, the U.S.–listed Chinese stocks plunged in 2021.
Some Chinese companies have decided to withdraw from U.S. stock exchanges entirely in response to the threat of increased regulation.
Presently, financial observers and investment banks speculate that a rebound in stock prices in 2022 is entirely possible after suffering losses.
Will the US-listed Chinese stocks fully recover?
Unlike financial institutions, China’s goal is not ultimately to make money but to develop its power and project it worldwide.
Furthermore, even if the Chinese regime produces a bubble that results in massive economic and social upheaval, the people who suffer have little authority. The Chinese Communist Party (CCP) has total power and does not face any consequences at all. The current collapse of real estate development is a clear example. Although tens of millions of investors have lost their life savings, the CCP remains in power.
Alternatives to Wall Street: Hong Kong and Beijing Exchanges
With the acquisition of Hong Kong Exchanges and Clearing Limited, Beijing currently owns Hong Kong Exchanges and Clearing Limited (HKEx). As the world’s third-largest exchange, the Hong Kong government is its largest shareholder. As a result, the Chinese regime has ample opportunity to develop and enhance its influence at the expense of U.S. stock markets.
The Hong Kong exchange is attracting U.S. corporations to list, thereby lowering secondary listing requirements. Furthermore, China can utilize capital and manipulation to control the Hong Kong, Shanghai, and Shenzhen exchanges’ performance to strengthen its power and influence.
The Rise of the Central Kingdom and Normalized Preferences
Beijing’s ambition is to replace American hegemony with its own, and it’s happening at an alarming rate. Weakening, if not destroying, the world’s confidence in the U.S. stock market and the dollar is an integral part of the plan.
Part of the plan could include shorting U.S. markets and draining billions, if not trillions, of dollars from the U.S. economy.
The outcome would be a loss of confidence and esteem in the United States from around the world.