Part 5/7:
As we turn our gaze to the United States, the implications of China’s financial instabilities appear increasingly dire. Financial patterns from past crises suggest that downturns in lending and rising interest rates signal economic weakness. If China’s lending continues to collapse, the ripples could lead to a lending downturn in the U.S., pushing interest rates down and potentially leading the American economy towards stagnation or recession.
Analysis suggests that the U.S. treasury market, typically responsive to changes in lending and economic health, may not reflect rising rates for long. It could eventually experience a downturn as economic signals point towards declining demand for loans, characteristic of struggling economies.