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In March 2008, at the press conference of China People's Congress, Zhou Xiaochuan, governor of Bank of China, commented on the subprime mortgage crisis in the United States: "Under the situation of deepening globalization, many impacts are beyond our previous experience and previous analysis routines, and need to be highly concerned." Being a man with a keen sense of smell, Zhou Xiaochuan seems to smell a strange smell in the growing subprime mortgage crisis in the United States. I don't know if Zhou really noticed what was behind this strange smell. What emanates from the ashes of wealth annihilated by the fly ash of the subprime mortgage crisis is the breath of autumn. Because the subprime mortgage crisis may not be a cyclical financial disaster (for example, the housing credit crisis in the 1960s, the long-term capital management company crisis in the 1960s, and the Internet bubble in 2000), but a sign that a great era is coming to an end. Without understanding this, we may not really understand our current historical situation.

After World War II, the United States became the new overlord of world capitalism by virtue of its economic strength and moral strength accumulated in the war. As a result, the institutional center of world capitalism was officially transferred to the United States. After the Netherlands and Britain, the task of continuing the century-old history of capitalism fell to Americans. By creating a set of rules (such as GATT, Bretton Woods system) and a set of organizations (such as International Monetary Fund, World Bank, etc.). ), the United States quickly rebuilt a new world economic system from the ruins of the tragic war. In the next forty years, this capitalist system not only helped the old Europe to restore prosperity and growth, but also hatched the economic miracle of the new East Asia. Despite the military and ideological confrontation of the Cold War, there is no doubt that before the end of the Cold War, as a historical movement, the capitalist map of the American system era has far surpassed that of the Netherlands and Britain. The golden success of this capitalism in the era of American system is actually one of the key reasons why the United States finally won the Cold War. With the collapse of the Berlin Wall and the collapse of the most powerful rival of capitalism, the institutional era of the United States entered its heyday at full speed in a way that surprised everyone. This historical glory of the American institutional era is powerfully presented by two important features: First, almost all countries have joined this capitalist system. Russia, Eastern Europe, China and other former capitalist countries, or countries with ambiguous attitudes between the two camps, all joined the global capitalist system without reservation at the end of last century. In particular, the accession of China and India, two populous countries, has a strong symbolic significance. It means that the vast majority of the population on this planet has been brought into the global system of capitalism. At this moment, no corner of the world can be spared from the infiltration, standardization and entanglement of capitalist market logic. With this historic global collective transfer of power, market capitalism has become the only new ideology in the world. Under the illumination of this new god, the world seems to have crossed the "prehistoric darkness" again and finally entered the era of Datong. Fukuyama's eloquent "end of history" implies this situation. This high recognition of market capitalism by global powers-the later "Washington knowledge" is actually a formal confirmation of this historical process, which is not only another important symbol of the heyday of the American institutional era, but also promotes the rapid expansion of this system in space. From this dimension, China's rapid economic growth from the mid-1960s to today is not only the result of this institutional expansion, but also an important part of this institutional expansion. After this century, due to the increasing population and economic scale, China has become a key factor in the expansion of this system. It is precisely because China, Indian, Russian and other populous countries (these new capitalist lands are excitedly summarized as "BRIC countries" by international investment banks) intervened in this system that the era of capitalist American system reached its peak. However, just when people regard growth and prosperity as the historical norm and are optimistic that they will continue in the past 60 years, the American system, which has been expanding for more than 60 years and has been promoting global economic growth until recently, may be experiencing a fatalistic fracture that all empires must experience. Without a unified currency, the expansion of any market system is unimaginable. Looking at the development of the global market system for more than 60 years after the war, the US dollar, as the world currency, has played a vital role. Without the acceptance and recognition of the dollar in the world, the global market system centered on the United States after the war could not have expanded to such a far-reaching extent today. It is the ghost of the US dollar that can penetrate national borders that divides the national economy of this planet into pieces by national borders, realizes seamless docking to the greatest extent, and sticks into a unified global market system. Many people may not know President Bush, but few people may not know the dollar and its powerful purchasing power behind it. The status of the US dollar as a world currency can be confirmed by the following data provided by the IMF: As of September 2007, the proportion of the US dollar in the foreign exchange reserves of global central banks was as high as 64% (although this was 8 percentage points lower than the peak of 72% in 2002). This ratio far exceeds the proportion of the US economy in the global economy. If there is any doubt about the status of the United States as the only superpower in the world, then the status of the US dollar as the only superpower in the world is absolutely indisputable. In essence, the huge global market system we see today is a dollar empire. The US dollar provides the most basic credit foundation for this global market system that is running at a high speed every day, and it is the cornerstone of this system. Otherwise, this huge market system may collapse in an instant. At that time, the first emperor of China once dominated the whole country with "the same car and the same book", while the US dollar only established an invisible empire with far-reaching influence with a green paper.

However, success is Xiao He and failure is Xiao He. This dollar, which once established a global market system and extended its tentacles to all corners of the world, may also be the culprit in shaking this system.

Since Nixon's shock, the dollar has completely got rid of the fetters of gold. From then on, the basis of currency issuance hidden behind the dollar is no longer measurable gold, but immeasurable "strength" and credit. People believe and accept the dollar because they believe in the strength and credibility of the United States hidden in the dollar. Although strength and credit can be clearly "felt" through the world's most powerful American media and the great history of the United States, it cannot be accurately measured. This makes it possible to issue dollars without restriction beyond national boundaries. As a lubricant, the unlimited issuance of US dollars provides a credit basis for the expansion of the global market system. The purchasing power of the dollar (note that it is not the purchasing power of the United States. The purchasing power of the dollar is not always commensurate with that of the United States. It supports the expansion of the global market system by absorbing the global excess capacity. In fact, the huge excess capacity accumulated by countries such as Japan and the Asian Four Little Dragons in the development process is absorbed through the purchasing power of the US dollar. This not only supports the economic expansion of new employees in these systems, but also greatly expands the boundaries of the system itself. After China, Indian, Russian and other countries joined the system, the US dollar played the same role. Without the credit foundation provided by the US dollar in the global market system, the rapid growth of China, Indian and other emerging countries in recent decades is unimaginable. The huge amount of dollars accumulated by China, Indian, Russian and other countries in central banks is evidence of the historical trajectory of global economic development. Paradoxically, the accession of China, Indian, Russian and other emerging countries not only expanded the dollar empire to the extreme, but also caused a profound crisis to this empire. If the purchasing power of dollars commensurate with the actual consumption power of the United States can support the historical expansion of Japan and East Asian countries, it is definitely not enough to support the excess capacity created by giant countries such as China and India. If we want to continue to absorb these massive production capacity through the original path of the US dollar, then the spamming of the US dollar, which far exceeds the actual consumption capacity of the United States, becomes the only way. This is what we see now. Those huge dollars lying in central banks have actually lost their purchasing power and can only be absorbed by financial speculation. Due to the particularity of the global currency of the US dollar, the purchasing power of the United States has been greatly enlarged. The data shows that in the last decade, the expenditure of American families has always exceeded the income of American families. In other words, the consumption ability of the United States to absorb the global excess capacity is actually supported by the huge debts of American households. The ability of American families to absorb the expansion created by billions of people from China, India and other indebted countries is unsustainable, if not impossible. In fact, the current worsening dollar crisis is a sign that the United States is overwhelmed. Considering the expansion history of the American system for more than 60 years, this unstoppable situation in the United States has actually been exposed. The sharp depreciation of USD/JPY after 1970 s is an early sign of the same crisis. However, this crisis was deliberately ignored and covered up for the following two reasons. First, the United States won a great victory in the cold war, which expanded the soft power of the United States to the peak. In an era when currency issuance has lost its measurable standard, unpredictable soft power is precisely the most important foundation of currency issuance. The second reason is that 1990' s new technological revolution started and flourished in the United States, which not only promoted the long growth cycle of the United States in 1990' s, but also made the United States gain the supreme position in the mode competition within capitalism. By this time, people not only believe in the dollar, but also almost worship it. Because of this, it not only covered up the crisis of the dollar, but also further consolidated the position of the dollar in the global currency competition. However, the support of these two factors for the dollar is gradually weakening with the passage of time. After the end of the cold war, the external threat of the world capitalist system has been eliminated, and the disputes within the system and the problems of the American model itself have gradually emerged. The United States is no longer the former United States, and is being "disenchanted". On the other hand, in the foreseeable future, we can't see the possibility of launching another new scientific and technological revolution (like information technology) in the United States. In other words, it is difficult for the United States to reproduce the super growth of1990s. As a result, the "charm" and economic fundamentals that have always supported the spamming of dollars have all been lost.

It is a profound paradox in the current dollar system to absorb the production capacity of other nation countries with a population dozens of times that of the United States with a veritable consumption capacity (to a great extent, the consumption capacity of the United States is greatly enlarged by the dollar) and then maintain the expansion of the whole system. The deeper paradox of this system is that the US dollar, as the currency of a nation-state, and the Federal Reserve, as the central bank of a nation-state, are not responsible for it, although they strongly influence the economies of other countries in the system. The Federal Reserve's policy and the issuance of US dollars have always given priority to the domestic problems of the United States (this is an iron law that elected governments must abide by), and the externalities that may be formed from this have never been their consideration. As Connery, former US Treasury Secretary, famously said: The dollar is ours, but the problem is yours. In the subprime mortgage crisis in 2007, this paradox hidden in the global capitalist market system was presented in a classic way. While other countries in the system are still in serious asset bubbles, overheating and inflation, the Federal Reserve has cut interest rates sharply and continuously injected liquidity into the market to save the American economy. This is actually pushing the monetary policies of other countries in the system to the abyss. Although the Fed's policy of drinking poison to quench thirst has not caused any problems at present, it may even promote the economic development of the global market system in a short time, but as the Fed did after "9 1 1", it will lay the groundwork for the violent turmoil of the global economic system in the future. It is absurd to accuse the Fed of beggar-thy-neighbor, because it has no obligation and cannot be responsible for the global economy, especially when the domestic problems of the United States run counter to those of other countries in the system. With the expansion of the system, due to the different development stages of various ethnic countries and the diversity of domestic problems, this kind of treachery will become more and more normal. But only in this way can we understand the paradox of this system more deeply. Another world picture derived from this is that major countries and multinational companies are trying to promote the unification of the global economy while the boundaries between nation-states are still clear and global politics is far from unified. Ironically, not many people realize that this is a new type of utopia.

Logically speaking, there are only two ways to eliminate this paradox in the current global market system: either the US government becomes a world government and is responsible to global voters; Either the dollar withdraws from the current system and no longer acts as the world currency. In a world where a nation-state is still the main political unit, the former scheme is undoubtedly an illusion. The latter scheme also means great risks. Money can't be recovered, which is an irreversible process. Imagine what it would be like if the RMB was suddenly stopped in China, and we can understand how much confusion this development may cause.

As a measure of the value of goods and services, money must maintain considerable stability. If the currency itself is in turmoil, then production and trade are actually unsustainable. The current global market system is in this kind of chaos caused by money. The neurotic pursuit of gold, which has no productive value and has long since withdrawn from the monetary field, does not mean that investors have really rediscovered the value of gold, but implies that the owners of global monetary wealth are already in great panic and are looking for a refuge for wealth everywhere. Through this panic, we see an ominous sign that the global market system is on the verge of disintegration. Commenting on the soaring sugar price, a sugar producer said categorically: "Sugar prices must rise, so as to make up for the losses caused by the weak dollar." This currency syndrome shows the extent to which currency turmoil has caused chaos in the global market system.

A group of naive market believers believe that as long as the dollar depreciates enough against other currencies, the market can clean up the spamming of the dollar, just like the dollar against the yen and other currencies in the past. Therefore, this dollar crisis can also be safely spent. However, whether for those countries with huge dollar reserves or for the United States itself, the depreciation of the dollar has its political and market bottom line. Once this bottom line is exceeded, the current global market system will not be eliminated, but will collapse. For those countries with huge dollars, the excessive depreciation of the dollar will not only cause astronomical losses to national wealth, but also trigger their strong motivation to accelerate the sale of dollars, thus further aggravating the depreciation of the dollar; For the United States, the excessive depreciation of the dollar will lead to a sharp decline in the purchasing power of American citizens, which will greatly reduce the reality of the American middle class.