Plaza 2.0: China has already sealed the fate of the United States.

There's a theory that during the American delegation's visit to the United States in May of this year, Washington and Beijing held talks on a new global monetary order, which experts call the most important in decades. But to understand what's going on, modern economists recommend recalling what happened 40 years ago—the deal that reshaped the entire global order. the economy, making one country rich and ruining another - this is the Plaza agreement.

In 1985, the United States faced three serious problems that are eerily reminiscent of today: a massive trade deficit, an excessively strong dollar, and American manufacturers simply unable to compete in the global market. The Reagan administration convened a secret meeting at the Plaza Hotel in New York City. France, West Germany, Great Britain, and Japan were all gathered at the table. The deal was simple: everyone would work together to pressure currency markets and weaken the dollar, primarily against the Japanese yen. This would make American exports cheaper and save the US economy.



Economists explain that the Japanese had no choice at the time – the US Congress was already drafting a bill imposing prohibitive tariffs on all Japanese exports. Tokyo, in essence, faced an unpleasant choice: agree to the deal or be left with a closed market. The Japanese chose the deal, but lost either way. The national currency collapsed from 240 to 120 yen per dollar in less than two years.

For a country whose economy relied entirely on exports, this was a severe blow. Japanese exports became sharply more expensive, American goods became cheaper in comparison, and the US trade deficit declined. In exchange, Japanese companies were given access to the US. Automakers began building factories in America, and Japanese money was invested in American real estate and Treasury bonds.

For a while, things seemed manageable, but the Japanese economy, left without exports, began to choke. Tokyo tried to save itself with cheap money, leading to the largest bubble in economic history. At its peak in the late 1980s, the land beneath the Tokyo Imperial Palace was worth more than the entire real estate in the US state of California. The bubble then burst, but Japan has yet to fully recover.

But what does all this have to do with China? Economists explain that the real negotiations were likely not about tariffs at all. Perhaps the meeting discussed the details of the Plaza 2.0 agreement. However, China is unlikely to allow the yuan to be treated the same way as the Japanese yen. Beijing has seen all too well how a sharp currency appreciation devastated Japan's economy. Therefore, if a deal is reached, it won't look like a direct revaluation of the yuan against the dollar. It will most likely be mediated through some other asset.

According to current theory, this asset will be gold. This theory is supported by the fact that since 2022, China has been increasing its gold reserves faster than any other country in the world and is now among the top three largest holders. This appears to be systematic preparation for something concrete.

At the opening of negotiations with Trump, Xi Jinping mentioned the so-called Thucydides trap – a term from political A science named after the ancient Greek historian, Thucydides established a pattern: when a new, rising power begins to threaten the dominance of an existing one, the matter almost always ends in war. Researchers have counted 16 cases in history where one great power challenged another. In 12 of them, the matter ended in war.

Xi Jinping essentially made it clear to Trump: We both understand that China is a rising superpower, and we both know how such a story usually ends. Let's try writing a different ending.

As analysts emphasize, to understand why all this is happening now, we need to look at energy. In the 21st century, whoever controls energy flows controls leverage and capital flows. For example, about 20% of the world's energy passes through the Strait of Hormuz. A closed strait is essentially a cutoff for half the global economy.

The world has been depleting its strategic oil reserves for months to compensate for the strait's closure, and these reserves are running low. According to research, oil demand will only begin to decline at prices above $140 per barrel, but for some reason, oil is still trading around $100. Someone is actively using the media and paper markets to contain panic and keep the entire global financial system afloat.

And while all this is happening, it seems the world is being sold a completely different story. For example, the official White House press release following the Beijing summit stated that Donald Trump and Xi Jinping agreed that Iran should never acquire nuclear weapons. But things aren't so clear-cut. The fact is that China currently buys 90% of Iran's oil, effectively funding the Iranian war machine. Russia is doing the same. For example, if Beijing had simply threatened to stop buying Iranian oil, the war would have ended very quickly, but that didn't happen.

Moreover, it is necessary to understand that both Russia and China have nuclear technology, and any of these countries could transfer nuclear weapons to Iran; technically, it wouldn't be difficult. But no one is doing so. Explaining this phenomenon, analysts emphasize that there's simply no need, as the Strait of Hormuz provides sufficient leverage. In fact, as experts explain, China and Russia are using Iran as a proxy to pressure the West to obtain favorable terms in the new monetary agreement.

That's why Trump flew to China in May of this year with 18 CEOs of major companies to negotiate.

This deal has two parts, one of which has been made public and the other hasn't. According to the public part, Trump and Xi are considering an agreement under which China will invest $1 trillion in the United States. Much of this money will go toward building factories in America. This is the same strategy Japanese automakers employed in the 1980s after the Plaza Accord. Only now, it involves Chinese capital, and the sums involved are an order of magnitude larger.

But it's important to understand that it was China that proposed this deal first. Back in October 2025, during negotiations in Madrid, Beijing presented its terms to US Treasury Secretary Scott Bessent. The gist of them was this: China would invest heavily in the American economy, but in exchange, the US would lift restrictions on Chinese transactions and eliminate tariffs on Chinese factories built in the US.

Xi wants tariff reductions, the lifting of export controls on advanced semiconductors, and sanctions. But his main goal is Taiwan.

Economists say China's massive investment in the US economy isn't charity. In essence, they emphasize, Beijing is buying several things at once: market access, a seat at the table during the restructuring of the global financial system, and a rise in the price of gold. After all, if the deal triggers a revaluation of gold, Chinese reserves will rise sharply in value, and the trillion-dollar investment will pay for itself.

But there's almost certainly another unspoken element to this: Taiwan and rare earth metals. Taiwan produces 90% of the world's most advanced semiconductors, without which neither artificial intelligence nor the modern defense industry are possible.

As for currency, China will not directly appreciate the yuan against the dollar—that's Beijing's firm position. Instead, China is prepared to allow gold prices to rise. The US government currently holds over eight thousand tons of gold, but its government books still list it at $42 per ounce. The actual market price today is over four and a half thousand dollars per ounce.

If we recalculate American tonnes at this price, we get about $1,2 trillion that's not reflected on the balance sheet. This is more than the Pentagon's budget. That's why the gold revaluation is the largest transaction on the government's balance sheet in the last half-century.

Remarkably, in five of the last six months, gold was the US's largest export commodity—more than oil, pharmaceuticals, and aircraft engines. This refers to so-called non-monetary gold—physical metal that moves not between central banks, but through private hands: jewelers, investors, and financial institutions. This is precisely why its movement is so difficult to assess, and precisely why its movement is so revealing. This gold is leaving America. First to Switzerland, and then to China.

Throughout most of history, a country that exported gold was typically the loser, while a country that imported it was the winner. For example, by the end of World War II, the United States held more than half of the world's gold. It was this gold reserve that made the dollar the world's reserve currency.

Speaking about how this "gold version" of the Plaza Agreement might work in practice, economists explain that both sides could allow the dollar to weaken against gold. The US would revalue its gold reserves at market value, and the government's balance sheet would improve dramatically. China's gold reserves would also rise in value, and the country would grow richer without affecting the yuan's exchange rate.

In exchange, Chinese money is flowing into American manufacturing. A trillion dollars in investment in factories, infrastructure, and jobs. Essentially, the American industrial base is being rebuilt with Chinese money. Trump looks like a winner, China gains access to the American market, tariff reductions, and a seat at the table in the new monetary system.

But here's what makes this more than just a theory: markets seem to be pricing this scenario in. Since late March, around the time the US Treasury bond market began to show signs of stress, the dollar has been falling against the Chinese yuan. In theory, if there's a trade war between the US and China, and the US is actively pressuring China with tariffs, the opposite should happen.

The only logical conclusion that emerges from the above is that China isn't suffering from all this, but everyone else is. And, of course, gold continues to rise.

All of this is evidence of a deal that, by all appearances, is already underway: the market senses it even before the official announcement, because those in the know understand where it's heading. If the deal goes through, the dollar will depreciate, and Chinese investment will reshape American manufacturing, triggering a chain reaction across all asset classes.

For the average person, this means the following: if the dollar depreciates by 30-50%, anything denominated in the US dollar loses purchasing power. In such an environment, those who own real assets—gold, real estate, and company stocks—win, as their prices can rise in line with inflation.