alt Hacker NewsI have this pet theory that is fueled with ignorance but kind of make sense to me: The correct value of the USD would be adjusted to match the tech company valuations sans AI(Apple can be a good guide IMHO) when they serve 350M people instead of 8B people as AI makes software obsolete and the geopolitics and the US government behavior dismantles any network or lock in effects.
Replies
> US government behavior dismantles any network or lock in effects
You should look at where most of the compute of the world is physically located. You might have a shock.
related:
"It's hard to argue that the yuan isn't undervalued. As the International Monetary Fund noted in its country report published in February, China's external position "is assessed to be stronger than the level implied by medium-term fundamentals and desirable policies." The yuan has nonetheless fallen in real terms due to China's low inflation.
Indeed, the renminbi has depreciated in real terms four years in a row, registering a cumulative 14% decline since 2021, according to IMF economists. They estimate China's real effective exchange rate could potentially be up to 20% undervalued.
China watchers Brad Setser and Mark Sobel, both former U.S. Treasury officials, go further and say the yuan is probably undervalued by as much as 30%. Setser has long argued that China's official balance of payments data understates the country's real surplus and that customs data is the more accurate barometer. By that measure, the trade surplus would be a percentage point of GDP wider."
https://www.reuters.com/markets/europe/chinas-yuan-is-underv...
I'm interested to understand your theory better but right now the way you've expressed it is hard to make sense of for me.