If you have any illusions, put them aside now. It's the Yuan's world – the West is just living in it, or borrowing from it as the case may be.
Demand for the Yuan is growing at such a staggering rate that your financial future will be built upon it.
Admittedly, this is a very tough concept for most people to wrap their minds around. It's tough to lose "your" spot at the top and it's even tougher to know you're losing it and not be able to do anything about it because the leaders who are responsible for maintaining that position don't understand the end game.
It's made worse by Washington's insistence that the dollar is still a weapon when large swathes of the world now believe it's a liability. It's exacerbated by Europeans who forget that a sound currency actually requires underlying economic stability. It's threatened by the latest crop of Japanese bankers who seem determined to print money into oblivion.
Sadly, this is not new. The old guard always fights for the status quo when something different or not well understood like the Yuan comes onto the scene.
The Rise of the Yuan
When you think about it, this isn't too hard to understand because there's usually a lot of sharing as trust builds between nations during periods of mutual development. Concurrent economic and intellectual openness promotes new monetary relationships then…BANG!
Suddenly, some become far more equal than others, to borrow a phrase from George Orwell's allegorical masterpiece, Animal Farm. Very quickly the growth that everybody once enjoyed craters, placing new restrictions on the creativity and wealth needed to sustain it. Absent a logical outlet, the excess energy and economic wealth that would have been previously incorporated into the old system goes somewhere else.
That somewhere else is the Chinese Yuan, and it will be for decades to come. Everything else is just a sideshow.
For example, lately people have been talking in angry terms about the huge piles of cash U.S. corporations hold offshore. Most are frustrated that corporations find it more profitable and less risky to keep it there. They don't draw the connection between that cash and redirected wealth.
Apple, if you've been reading up lately, is the poster child for what I'm talking about. It has over $137 billion in the bank, with some 70%, or $94 billion, being held offshore. They assume it's all in dollars.
What they don't realize is that huge chunks of cash are held in other currencies, chief among which is the Yuan.
About the Author
Keith is a seasoned market analyst and professional trader with more than 37 years of global experience. He is one of very few experts to correctly see both the dot.bomb crisis and the ongoing financial crisis coming ahead of time - and one of even fewer to help millions of investors around the world successfully navigate them both. Forbes hailed him as a "Market Visionary." He is a regular on FOX Business News and Yahoo! Finance, and his observations have been featured in Bloomberg, The Wall Street Journal, WIRED, and MarketWatch. Keith previously led The Money Map Report, Money Map's flagship newsletter, as Chief Investment Strategist, from 20007 to 2020. Keith holds a BS in management and finance from Skidmore College and an MS in international finance (with a focus on Japanese business science) from Chaminade University. He regularly travels the world in search of investment opportunities others don't yet see or understand.