Impact Assessment Metric of China X USA Retaliation: And in the Fiat and crypto world, collapse or strategy?
Name: Systemic Vulnerability Index in Financial Retaliation (SVIFR)
1. Main Components:
1. Systemic Impact (SI):
- % of US Treasury securities held by China (~10%).
- Expected volatility in markets (interest rates, exchange rates, stocks).
- Cost of Fed intervention to stabilize debt.
2. Operational Costs (OC):
- Increase in US debt interest rates.
- Loss of value of Chinese dollar reserves.
- Impact on global GDP (e.g.: OECD estimates 0.5–1.5% loss for the US).
2. Simplified Formula:
SVIFR = 0.6 \cdot SI + 0.4 \cdot OC
(Higher weight on systemic impact due to the risk of global crisis).
3. Interpretation:
- > 7.0: Severe crisis (flight from the dollar, panic in the markets).
- 4.0–7.0: High tension (USA and China suffer, but without collapse).
- < 4.0: Limited impact (China acts gradually).
Conclusion:
China would avoid a sudden sell-off (it would harm its reserves), but would accelerate the reduction of dependence on the dollar. The USA would suffer more in the long term (loss of confidence in USD).
Monitor: China's gold reserves, US interest rates, and agreements in alternative currencies (CNY, BRICS).
e you 🫵 🫵 🫵 🫵 what do you think about all this?
