NOTE: This is part of a continuing online novel. Here is the Table of Contents.

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If an American were asked, on January 2, whether he would trade his country’s position with that of China, he might just say yes. That's the way the papers made it seem.

Jin Renquin certainly wouldn’t. The government finance minister looked at his desk and saw a thousand problems, all intractable, many of them contradictory.

A rising currency is a pearl of great price, he thought. It makes everyone wealthy by making imports cheap, but the price is that it makes exports dear. Hong Kong investments in American companies and real estate were falling in value, and merchandise was also rotting on Chinese docks as buyers became unable to afford previously-negotiated prices.

This was not just true for American exports, but for anything priced in dollars. Further down in the bureaucracy men were on the phone with exporters anxious to take pesos, cruzeiros, soles, even Botswana pula for contracted goods. But how could they translate contracts originally written in dollars? What was fair?

While the Renminbi had not skyrocketed against other western currencies, it had more than held its own in the last month. That made exports to England and Italy less expensive, and businesses were clamoring over sales lost to Americans. Lay-offs had begun, more were coming. Electronics and foodstuffs were especially hard-hit, because both would literally rot on wharves unless alternate customers could be found, and quickly.

Jiang Zemin preached stability over all, and this rash decision to let the Renminbi float had caused great instability. People could literally starve while bureaucrats tried to get the economic wheels in motion again, to find new customers.

The problem was easy to describe, but nearly impossible to solve in detail. China had allowed its currency to float against the dollar, but it now needed adjustable rates against all the world’s currencies. The price of all exports from its export-driven economy had now risen, and the price of imports had plunged, threatening literally tens of millions of jobs. An economy that seemed on the verge of over-heating now seemed about to seize up like a car engine that had thrown a rod.

There were other problems as well. China’s appetite for energy was becoming insatiable. Import prices had fallen, because the Yuan was rising in value while oil was priced in dollars, but the recent mine accidents and the environmental cost of burning coal were leaving workers on the verge of revolt and the sky in a yellowish haze. Peasants, already restive, were becoming even more angry seeing high-quality imported food for sale at prices less than theirs cost to produce.

Jin was pensive, quiet during President Hu’s weekly cabinet meeting. He spoke figures when asked for them, but otherwise kept his silence.

It wasn’t until foreign minister Li Zhaoxing had been speaking for some time that Jin's cloud began to lift, and he began to think again.

“Futures,” he said suddenly, interrupting Li.

The table silenced, and all eyes turned toward Jin.

“Currency futures,” he said at last. “We need to establish futures markets for all world currencies, and connect exporters to them via the Internet. They can then lock in a value, set a price, and know that when the goods arrive anywhere they can settle without further risk.”

“There are already such markets,” said Li.

“I know,” said Jin. “We just need to help our exporters participate in them fully. What many have done is trade Renminbi for Hong Kong Dollars, and then set a price. You can use the Internet to get current conversion rates from many countries. Our ministry needs to establish futures markets for Renminbi here, as well as Hong Kong, then make certain there is adequate online access, and ample liquidity. It should not be too difficult. It should not take long at all. It's a question of education.”

“There remains the problem of finding markets for the goods,” President Hu said. “If there is no one to pay you, it doesn’t matter how you are paid.”

“Over weeks, over months, that is not a problem,” agreed Jin. “Over days, over weeks, the challenge is enormous. We might as well give it away.”

Silence returned. Now it was Li’s turn to interrupt.

“Why not?” Li said. “Why not give it away? And why not cement a new relationship with the Island at the same time?”

“What do you mean?” asked Hu.

“We donate goods in high supply, like electronics and food, to nations in the greatest distress, like Somalia and Sudan, under the auspices of the United Nations. We then contract vessels of the island province, along with other neutral vessels, to handle the shipping. The American blockade will then be broken by commercial ships coming across the strait to Shanghai, to Hong Kong, and to Macau, to load goods under UN flags bound for people in need. Other nations with short-term trade imbalances can fly the same flag, under the same program. We can also ship using convoys, avoiding South China Sea pirates, putting some of our smaller warships under UN flag as well for this purpose.”

“How much time would that buy?” asked Hu.

“I don’t know,” said Li. “But it would buy us goodwill, which we can always make use of. It could also strike a blow for the UN against the United States, which is now trying to get rid of the Secretary General. He would then be beholden to us.”

“Cost?” asked President Hu.

“Half of what it would have been a month ago,” said Jin with a smile.