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Both America and China were invested in the illusion that China wasn't already the world's strongest economy. Psychologically, it suited the incumbent to appear strong. So America downplayed China's numbers. Strategically, it suited the disruptor to appear weak. So China also sandbagged its own numbers. But the illusion is becoming harder to maintain. In retrospect, all the China cope over the last decade or so was really just the stealth on the Chinese stealth bomber. Hide your strength and bide your time was Deng's strategy. Amazingly, denying China's strength somehow also became America's strategy. For example, all the cope on China's demographics somehow being uniquely bad...when they have 1.4B+ people that crush every international science competition with minimal drug addiction, crime, or fatherlessness...and when their demographic problems have obvious robotic solutions. Or, for another example, how MAGA sought to mimic China's manufacturing buildout and industrial policy without deeply understanding China's strengths in this area, which is like competing with Google by setting up a website. Vague references to 1945 substituted for understanding the year 2025. One consequence of the cope is that China knows far more about America's strengths than vice versa. Surprisingly few Americans interested in re-industrialization have ever set foot in Shenzhen. Those who have, like @Molson_Hart, understand what modern China actually is. Anyway, what @DoggyDog1208 calls the "skull chart" is the same phenomenon @yishan and I commented on months ago. Once China truly enters a vertical, like electric cars or solar, their pace of ascent[1] is so rapid that incumbents often don't even have time to react. Now apply this at country level. China has flipped America so quickly on so many axes[2], particularly military ones like hypersonics or military-adjacent ones like power, that it can no longer be contained. A major contributing factor was the dollar illusion. All that money printing made America think it was richer than China. And China was happy to let America persist in the illusion. But an illusion it was. Yet another way in which Keynesianism becomes the epitaph of empire. [1]: https://t.co/LoxJeQHzkj [2]: https://t.co/MRzErwuMv9 Well, it's not the idea, it's the execution. China can just sit back and let the world be its Xerox PARC. And then become a speedy second mover on anything that's working. So you need innovations China genuinely can't copy. One of them is Bitcoin. https://t.co/aW8GuCuKLf There's no easy exit for the US. Its business model of money printing depends on being global #1. Dollar inflation is global taxation. Pullback means the printing is spread across ~330M Americans rather than ~8B worldwide. That's a 95% drop in tax base. https://t.co/8r8qpF1BLa There's another deep similarity between Soviet Communism and American Keynesianism. In the final analysis, both economies were ultimately coercive. The Soviets were obviously so, because they were all about forcible redistribution and central planning by Gosplan. Meanwhile the US dollar is/was all about invisible redistribution and central planning (by the Fed), but that only worked globally so long as the US military was world dominant. If the new National Defense Strategy doc is as reported, a formal pullback from Asia will end that era[1]. There wasn't enough volition in the Soviet economy to keep it going after Communism ended. We'll see what happens once Keynesianism ends. [1]: By the way, this is Chesterton's fence, but for globalism. You can now see why the group that ran the American Empire prior to MAGA kept pushing to expand into Russia, China, Iran, and beyond. Even if it wasn't fully conscious, even if it was more like an ant colony's decentralized intelligence than a single master plan, even if you also believe the human rights arguments, there was also an economic reason for constant expansion, and even nuclear brinksmanship with Russia. Namely: if the empire[2] wasn't constantly growing the tax base for dollar inflation, it was shrinking. [2] PS: an empire isn't necessarily always a bad thing. As "Tomorrow the World" documents, the US built its empire in 1940 because the British Empire was failing, and because the Soviets or Nazis were the other two alternatives. And in many ways America was the greatest empire of all time. So, even if it's no longer able to make it financially, even if it's becoming a country-not-an-empire, we should respect what it accomplished in its prime. Yes. Also, after the dollar ends, I think ~50% of Westerners will become Bitcoin Maximalists (and blame the collapse on the Fed and centralized power) while ~50% may turn to Chinese Communists (and blame the collapse on BTC and decentralized currency). https://t.co/epy173ES1d To be clear: I think blaming Bitcoin for the end of the dollar is like blaming the parachute for the plane crash. The money printing scaled way before Bitcoin scaled. But many won't get it. https://t.co/DhqRNjaBGh