332: Chapter 332 Inflation Tsunami

August 7th, Queens, New York.

The shelves at the Walmart supermarket were bare.

Egg section: Limit one carton per person, eight dollars per carton—it was three dollars last week.

Milk section: Limit two gallons, six dollars per gallon—it was 3.5 dollars last week.

Bread section: Only a few expired loaves of whole wheat bread remained on the shelves.

Maria, a housewife, pushed her empty shopping cart with a look of despair.

She was forty-five years old, had three children, and her husband was a worker at a construction company. A week ago, she could fill a shopping cart with two hundred dollars. Today, two hundred dollars was only enough to buy a week's worth of milk and eggs.

An old man nearby sighed, his voice raspy:

"I've lived for seventy years, and I've never seen anything like this."

Maria didn't speak. She just stared at the empty shelves, tears streaming down her face.

New Jersey, a gas station.

The numbers on the gas price sign made every driver curse.

$5.99/gallon

It was 3.5 dollars a week ago.

Mike, the driver, looked at the gas gauge and cursed:

"F**k! It costs eighty dollars to fill it up! My daily wage is only one hundred!"

He gritted his teeth and swiped his card.

The gas pump began to run.

Eighty dollars bought a tank of gas and a week of commuting.

A middle-aged man in a pickup truck nearby looked at the gas price sign and immediately turned around to leave.

He still had half a tank of gas. Better to save where he could.

Washington, Federal Reserve headquarters.

In the underground conference room, the atmosphere was so heavy it felt like it could drip water.

Jerome Powell, Chairman of the Federal Reserve, sat at the head of the table, facing the data on the large screen.

July inflation rate: 12.5%

This was the highest record since 1979.

Powell was sixty-five, and his hair was completely white. He had worked at the Federal Reserve for thirty years and had seen countless crises. But at this moment, his palms were sweating.

"We must raise interest rates," he said. "150 basis points, immediately."

Someone objected: "It will collapse! The stock market will circuit break, companies will go bankrupt, and the unemployment rate will skyrocket..."

Powell smiled bitterly.

"If it doesn't collapse, inflation will eat us alive anyway. Which one do you choose?"

The conference room fell silent.

"Vote."

Fifteen voting members: thirteen in favor, two against.

Raise interest rates by 150 basis points.

When the news broke, the stock market plummeted in response.

Dow Jones Industrial Average: -8%, circuit breaker triggered.

NASDAQ: -10%, circuit breaker triggered.

S&P 500: -9%, circuit breaker triggered.

Traders stared at their screens, unable to believe their eyes.

Outside the White House, night fell.

Tens of thousands of people gathered.

Placards were everywhere:

"We want jobs!"

"President step down!"

"The dollar is collapsing, America is collapsing!"

"Xingchen Chain is the devil!"

"We want to eat!"

Riot police formed a human wall, their shields reflecting cold light under the streetlamps.

Someone started throwing bottles.

Bang—a glass bottle shattered against a police shield.

Someone set a trash can on fire.

The flames flickered in the night.

People started charging the police line.

The police fired tear gas.

A faint light shone from the windows of the White House.

August 10th, morning, White House Situation Room.

Seven people sat around the long oval table: the President, Hawk, the Secretary of the Treasury, the Secretary of State, Federal Reserve Chairman Powell, the Secretary of Defense, and the Chairman of the Joint Chiefs of Staff.

The large screen on the wall played footage of riots across the country. Burning trash cans, crowds charging police lines, and clouds of tear gas.

Hawk was the first to speak.

The fifty-eight-year-old Hawk's face was livid, his voice almost a roar:

"We must take action! Military action! Destroy the Xingchen Chain servers!"

The Secretary of the Treasury sneered.

The sixty-year-old Secretary of the Treasury came from Wall Street and had seen his fair share of storms. He said slowly and methodically:

"Where are the servers? One hundred meters underground in Shenzhen. And then what after we hit them? World War III?"

Hawk glared at him: "Then what do you propose we do?"

"Negotiate."

The Secretary of State added: "And how would we even attack? Russia has nuclear weapons, and China's missiles can reach the American mainland. Our aircraft carriers would be sitting ducks off the coast of China."

Hawk wanted to say more, but the President raised his hand to interrupt.

The sixty-year-old President looked ten years older at this moment. His hair was messy, and his eyes were bloodshot.

"Enough. Hawk, your plan will only make America die faster."

He looked at the Secretary of the Treasury: "What do you suggest?"

The Secretary of the Treasury was silent for three seconds.

"Have Powell call Xingchen."

3:00 PM, the Federal Reserve Chairman's secret call.

Powell sat in his office, the phone in front of him already connected.

A young voice came from the other end of the line: "Hello, this is Su Chen."

Powell took a deep breath: "Mr. Su, I am Federal Reserve Chairman Powell."

Su Chen's voice was calm, devoid of any emotion: "Mr. Powell, what is it?"

Powell's palms were sweating. He was sixty-five years old and had seen countless big scenes, but at this moment, he felt like a middle school student confessing his love to a girl for the first time.

"The United States needs to reconcile with Xingchen. The dollar is collapsing, inflation is out of control, and we need to stabilize the market."

There was silence on the other end of the line for three seconds.

Then Su Chen said: "Mr. Powell, the dollar's problems must be solved by America itself. All Xingchen can do is make Xingchen Chain more stable."

Powell grew anxious: "Mr. Su, we can lift all sanctions, we can open up the U.S. market, we can support China's position at the United Nations..."

Su Chen interrupted him: "When the U.S. sanctioned Xingchen, did you think about today? When Wall Street betrayed us, did you think about today? Now, America needs Xingchen's help—but Xingchen has no obligation to help America."

The call was disconnected.

Powell sat there blankly, listening to the busy signal on the receiver.

Lin Wan pushed the door open and walked into Su Chen's office, holding a stack of documents.

The twenty-six-year-old Lin Wan was wearing a dark suit, her short hair looking capable. Her expression was calm, but her eyes sparkled with excitement.

"Mr. Su, the latest data."

She began her report: "After twenty countries joined Xingchen Chain, the single-day transaction volume exceeded 200 billion dollars."

"SWIFT has laid off 30% of its staff, and its stock price has been cut in half."

"The dollar index has fallen below 85."

"U.S. inflation is at 12.5%, and the riots have spread to thirty cities."

Shen Nanpeng stood nearby and asked: "Mr. Su, are we really not going to do anything?"

Su Chen stood by the window, looking at the night view of Shenzhen Bay. It was brightly lit, with traffic flowing like a river—a scene of prosperity.

He shook his head.

"It's not that we won't do anything, it's that we can't. The dollar's problems are structural—sixty years of hegemony, thirty years of overdrawing, and ten years of quantitative easing. Xingchen Chain is just the last straw that broke the camel's back."

He turned around. "Let them solve it themselves. If they solve it, the world remains the same. If they can't, Xingchen Chain will be the infrastructure of the new world."

August 13th, a new global order.

The Wall Street Journal headline: "Dollar Collapse: The Greatest Crisis Since the Bretton Woods System"

The article read: "Within a week, the dollar index has fallen by 15%. Twenty countries have joined Xingchen Chain simultaneously, and SWIFT transaction volume has been cut in half. U.S. inflation has hit a forty-year high, and riots have spread across the country. This is the greatest challenge the dollar has faced since Nixon closed the gold window in 1971."

Financial Times: "The Era of Xingchen Chain Begins: After Twenty Countries, More Are Lining Up"

The article read: "The shift of five European Union countries was the final straw that broke the dollar. After the twenty countries, another thirty are in line. Xingchen Chain is becoming the new global payment standard."

Xinhua News Agency: "The Twilight of Dollar Hegemony: The World Needs a New Financial Order"

The article read: "Dollar hegemony has lasted for seventy years, relying on petrodollars, Wall Street dollars, and the U.S. military. Today, oil can be bought with rmb, Wall Street is rebelling, and the U.S. military dares not act. The twilight of the dollar has arrived."