1. The US-China trade war revolves around the dollar/renminbi exchange rate, with China's massive USD debt creating systemic risks; 2. A strong dollar exacerbates China's vulnerabilities, pressuring USD debt servicing and risking capital flight; 3. Tariffs are used as geopolitical bargaining chips, with the US leveraging dollar strength to gain trade concessions; 4. A grand macro bargain involves a weaker dollar to relieve China's financial strain, boosting global liquidity and benefiting both nations.
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