There can be little doubt that the this fey mood has been encouraged by the vast and worldwide popularity of The Da Vinci Code, Dan Brown’s conspiracy extravaganza, published in 2003, together with the 2006 movie based on it. Far too many readers actually bought its fanciful premise, despite earnest debunkings from almost every respectable quarter. These days, the subject, at least in
Much of this stems from a slight work titled Currency Wars, written by Song Hongbin, a Chinese American scholar, published in
According to Scholar Song in his book, starting in the age of Napoleon, a small group of European bankers began to grow strong, and they gradually gained control of the central banking systems of the
The stories about the American Civil War, World War I, and World War II, which Mr. Song covers, do not particularly impress Chinese readers as they happened too long ago and too far away. But his explanations of the Japanese economic crisis of the 1990s and Asian financial meltdown in 1997 hit much closer to home. Disaster looms, for it is definite by the end of the book that
As could be expected, this titanic story set across a panorama of time and space is filling a vacancy, however vacuously, in the minds of a Chinese people largely ignorant of the history of global finance. Universities in
Currency Wars has become highly popular with that reader on the street who must look for reasons beyond his country’s borders for the macro fluctuations that screw up his life. According to the book, traditional western economic and financial theories are a part of the whole conspiracy. Famous economists, including Keynes, serve the cabal. The book claims that through the influence of icons such as the Nobel Prize for Economics these international bankers have misleadingly transformed true economics, a subject which ought to be “profit” oriented, into a confusing and camouflaging mass of mathematical formulas.
And as for “profit,” according to Marxist economics, which every Chinese student has drilled into her head, everything that capitalists do is motivated by their desire for the surplus value they alone can capture. This is what it’s all about. The book claims that international bankers will do everything possible, confusing the masses and even launching a war, for the sake of that profit.
This great conspiracy thinking became very popular in
First, 2007 was the 10th anniversary of the Great Asian Financial Meltdown, a crisis which still lacks, to the uninformed mind, a reliable explanation. George Soros remains, if not exactly Satan, the Beelzebub of the conspiracy in
Second, with state-owned bank reform in 2004 and RMB exchange rate reform in 2005,
Third, the American sub-prime crisis spreading across the world from the second half of 2007 is just too convenient not to be a big part of and the next step in this conspiracy.
These theories of outsider financial conspiracy greatly affect many Chinese people, ranging from netizens and ordinary people up to top leaders. Many officials even ask their subordinates to read Currency Wars as homework.
There are those Chinese scholars who have written rebuttals of the book. Fred Hu (Zuliu), general manager of Goldman Sachs in
Naturally, such disputes have done nothing to dampen sales of the book.
Conspiracy theories tend to fade as time goes by and nothing further happens, while disputes keep them on the jump. The sub-prime crisis since the second half of 2007 has drawn people’s attention and makes them wonder.
First of all, the crisis seemed to come from out of the blue, even for Chinese economists. Secondly, for most Chinese it is close to unbelievable that any such event could have so huge an effect as to smite even an economic giant like the
Leaving out Currency Wars, even some researchers experienced at overseas investment hold similar views. Tan Yaling, global financial market researcher for the Bank of China and well-known analyst in the financial media, published a long article with the title Beware of USD Depreciation and Sub-prime Conspiracy, claiming that
Tan Yaling believes that the depreciation-appreciation-depreciation process of the dollar is purposely designed. Through the quick depreciation of the dollar,
Tan Yaling figures that the
If nothing else, disputes over such conspiracy theories bring the processes of
But for responsible, authoritative, internationally savvy economists to indulge in such claptrap does a disservice to their field and themselves.