Financial Cold War: A View of Sino-US Relations from the Financial Markets
Since the 2008 global financial crisis, tensions between the United States and China have risen rapidly. The rhetoric escalated further when the Trump Administration imposed significant new tariffs on Chinese goods and, despite a transition to a new administration in the White House, a near-term thawing of relations does not appear to be in the cards.
In Financial Cold War: A View of Sino-US Relations from the Financial Markets, market structure and geopolitical finance expert James Fok examines Sino-US relations through the lens of the financial markets, helping readers understand how imbalances and nuances in the structure of the global financial system have contributed to the current geopolitical tensions between America and China.
The book traces the history of the development of financial markets in both countries and of the current US dollar-based global financial system. It goes on to explain why the structure of world financial markets is fanning the flames of global tensions. Alongside a presentation of geopolitical developments between China and the West from the 18th century to the present day, the author examines the role of technology, innovation, regulation, taxation, and politics in markets. At the same time, he explores how the markets have impacted politics and policy.
Drawing on over two decades of hands-on experience in financial markets, including a decade on the frontline negotiating the integration of Mainland Chinese and international capital markets, Fok offers an in-depth analysis of the global financial system and questions the enduring assumptions that underpin it. He highlights the growing risks of dependence on the US dollar and worldwide fiscal competition, the challenges posed by China’s gradual financial market opening, and the role played by Hong Kong as an intermediary for capital flows between China and the rest of the world. He also suggests ways for Chinese and American policymakers to address key financial sources of conflict in order to de-escalate geopolitical tensions.
Financial Cold War is a must-read resource for anyone interested in the interplay between financial markets and international relations, and the international infrastructure of the financial system.
James Fok’s book highlights the explosive risks in the relationship between the US and China today. It also offers insights into fundamental driving forces of international frictions and is a call to take urgently necessary steps to address the sources of conflict.
—Klaus Schwab, Founder and Executive Chairman of the World Economic Forum
My only gripe about James Fok’s take on the bumpy road ahead for US-China relations is that his book doesn’t include a seatbelt. His message that things are about to get turbulent, one offered in uniquely personal terms, should be necessary reading for investors and businesspeople everywhere.
—William Pesek, award-winning Tokyo-based journalist; Forbes and Nikkei Asia columnist; author of Japanization: What the World Can Learn from Japan’s Lost Decades
Financial Cold War is a profoundly important book necessary for understanding China-US relations as well as the challenges facing the modern day global economy. James Fok has used his unique vantage point of working at the intersection of international finance and the Chinese economy to provide invaluable insights and analysis of this new geopolitical and geoeconomic frontline. It is remarkable in its breadth—tracking, from ancient days, how modern China and America have found themselves in this precarious position. Fok also offers practical steps for Chinese and US policy makers, business leaders and market participants to avoid, and de-escalate, tensions within this financial Cold War.
—James Shipton, former Chair, Australian Securities & Investments Commission; former Executive Director, Harvard Law School’s Program on International Financial Systems; former Executive Director, Securities & Futures Commission of Hong Kong
The multi-trillion-dollar financial market relationship between America and China has profound implications for the whole world. As the United States and China head down the path of digital and technology decoupling, their tension in finance—especially China’s new sovereign digital currency potentially challenging the US dollar’s supremacy—adds a new layer of complexity to the global economy. Thankfully, James Fok has delivered exactly the kind of comprehensive, timely and thought-provoking account you need to get up to date.
—Winston Ma, CFA, Managing Partner of CloudTree Ventures; author of The Digital War: How China’s Tech Power Shapes the Future of AI, Blockchain and Cyberspace
James Fok is a China expert and he found himself on the frontline of the Sino-US rivalry that threatens the world's financial ecosystem. This book benefits from his personal experiences, and from his passion for original research and for telling a story of global significance.
—Dato’ Seri Cheah Cheng Hye, Co-Founder and Head of Value Partners Group, Hong Kong
James Fok has written a convincing and highly-accessible tour tracing the emergence of the US and China as the dominant forces in modern-day global financial markets. Drawing together his personal experience of each country's approach to capitalism, he shows with erudition and wit how the world's two biggest economies have become intertwined in competition and co-operation, sometimes more alike than they like to admit, and raises the crucial question of how they can co-exist together in the future.
—Philip Stafford, Financial Times journalist and Editor of FT Trading Room
Financial Cold War takes a clear-eyed look at the state of geopolitics through the lens of US dollar hegemony and focused on a resurgent China fresh from four decades of remarkable growth. This is an important book for understanding where we are and where we might be going next, given our current financial system and its deep and omnipresent effects on daily life. The constraints around unwinding a dollar-driven global monetary system that increasingly serves no country well are especially sobering.
James Fok delivers solid insights into the history, culture, and present-day motivations of both great powers, anchored with real-world knowledge of financial markets. Superb!
—Jared Bibler, CFA, author of Iceland’s Secret: The Untold Story of the World’s Biggest Con
From his unique vantage point, James Fok majestically weaves a multi-layered tale which amounts to essential reading for anybody seeking to better appreciate our world from east to west.
—Patrick L. Young, author of Victory or Death? Blockchain, Cryptocurrency & the FinTech World
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