Capitalism will break down if we go back to spheres of influence. That is the entire premise of post WW-2 U.S. policy, to keep trade and trading avenues as open as possible and to allow the dollar to serve as a global currency.
China is being very dumb and short sighted.
China better not cross any of Obama’s red lines. We all know what happens then.
Zhongye Dao Island in the South China Sea