Trump knows China’s inevitable Great Depression is coming

Trump understands finance and economics. Trump knows that China is doubling down on their path to economic doom. I’ve come to believe that he is humoring the Chinese to get good trade deals for America, knowing that China is struggling to stave off their coming financial crash.

We have read about China building, and sustaining, its rapidly growing economy with huge spending on government financed projects. These projects are often large infrastructure and urban housing projects.

All governments do this. China’s mistake is doing it on a gigantic scale by continuing to print money it doesn’t have. This creates a vast public debt that becomes progressively more dangerous. This is perhaps an inevitable mistake made by leaders of socialist economies. Russia is doing the same thing to keep paying for its failing Ukraine gambit.

Socialists avoid the natural controls of capitalist economies that let businesses fail, rather than continue to cover their failure to make a profit. This leads to ever more government debt to avoid economic collapse, thus making the problem ever larger, and making the inevitable collapse ever worse.

Normally after an empire gains economic might, its currency takes an increasing share of reserves held by central banks. With a 17 per cent share of global GDP, but only 2 per cent of central bank reserves, China is trailing 30 to 40 years behind previous superpowers at a similar stage of their ascents.

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MtnClimber: "And their oil supplies are shrinking."

Sirius Lee: "What actions did Japan take when their oil supplies were embargoed by the U.S.?"

Japan's "Co-prosperity" sphere goals at 1942 peak:

China's situation today is in no way comparable to Japan's in 1941.
Japan in 1941 was much worse off than China is today:

Japan in 1941 had:
- More than a year's worth of oil in reserves
- But no internal sources and no suppliers after the American & Dutch oil embargoes
- Japan's economy did not need much oil, but its military could not function without oil for warships, airplanes, tanks & trucks, etc.
- US/Dutch oil embargoes gave Japan's military about a year to seize more oil or shut down operations.
- Japan's economy needed far more than just oil:
  Japan's "Greater East Asia Co‑Prosperity Sphere" needed a long list of raw materials -- oil, iron, tin, bauxite, rubber, cotton, rice, sugar, coconut, timber, quinine, hemp for rope & specialty fibers -- to be secured through conquests & colonizations.
  So, oil was just one among many Japanese reasons for making war.
China's global friends & allies today (in red):
China today has:
- 85% of China's energy is not from oil, but rather from other sources like coal, nuclear, hydroelectric & renewables.
- ~50% of China's oil imports come from Persian Gulf countries, however not all of that oil passes through the Strait of Hormuz.
- About half of Persian Gulf oil still reaches global markets via pipelines to ports on the Red Sea and elsewhere.
- China consumes ~16 million barrels of oil/day and its current oil shortfall is around 3 million barrels per day.
  China's strategic oil reserves total circa 1.4 billion barrels, meaning they have around 460 days of supply before things start getting a little tight.
- But even modest reductions in oil consumption -- and conversion to alternate energies (i.e., electric cars) -- can extend their reserves' days of supply significantly.

Bottom line: in 1941, after the US/Dutch oil embargos, the Japanese had no good options, but in 2026, Chinese have many good options to survive & prosper without resorting to war.
Also, unlike 1941, the US has not embargoed oil or anything else to China.
So the US blockade of the Hormuz Strait could end in days or weeks with no further economic harm done.

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