by Martin Armstrong, Armstrong Economics:
President of China Xi Jinping made a statement last year that has sparked a number of comments over the past few months. Xi Jinping said:
“The world is on the verge of radical change. We see that the European Union is gradually falling apart, how the US economy is crashing, and that all this will end with a new rearrangement of the world. In 10 years we can expect a new world order in which the key factor will be the alliance between China and Russia.”
You must understand that while China is technically under the Communist Party, they are by no means communist. Private industry and personal wealth has exploded. They may not have changed the party name, but the foundation of China is capitalist — not communist.
Some comments are saying that China follows every word I say. I think that is an exaggeration. Yes, before my ordeal, we entered into an arrangement with China to do the forecasting for about 1,000 government entities. Yes, I was invited to the Central Bank when the Asian Currency Crisis hit. Yes, I recommended going to the US Treasury and demanding to buy bonds directly circumventing the New York bankers. True, our services are not blocked in China.
All of that said, whether Xi Jinping is referring to our ECM and the turning point of 2032 that shows the financial capital of the world moving to Asia is up to anyone’s interpretation. Nevertheless, cycles are part of their core beliefs whereas in Western society we are trapped in Marxist thinking of a linear system.
Richard E. Nesbett wrote a good book entitled “The Geography of Thought, How Asians and Westerners Think Differently … and why.” He attributed his work to a Chinese student who said, “You know, the difference between you and me is that I think the world is a Circle, and you think it’s a line.” He goes on to quote him:
“The Chinese believe in constant change, but with things always moving back to some prior state. They pay attention to wide range of events; they search for relationships between things; and they think you can’t understand the part without understanding the whole. Westerners live in a simpler, more deterministic world; they focus on salient objects or people instead of the larger picture; and they think they can control events because they know the rules that govern the behavior of objects.”
This is the best description I have encountered of the difference between east and west. It is right on point. We think everything is a straight line (linear) and in Asia they see it as a cycle. So you can say Xi Jinping is following our model. Yes, perhaps. But on the other hand, they know it is a cycle without me. Granted, he may be using us for the timing. But the end game – that is inevitable.
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