Socialized Collaboration

 　　While high leverage has fueled rapid economic growth, it has also distorted industrial structures, leading to a divergence between price and value systems, ultimately suppressing the intrinsic driving force of social development. When economic growth fails to meet capital's expectations for the future, high leverage translates into high debt, and deleveraging becomes a transfer of debt.

　　Traditional economic logic outlines four deleveraging measures: first, reducing total social expenditure, including fiscal and household spending—essentially tightening the belt; second, restructuring debt to alleviate corporate difficulties, such as debt reduction, debt-to-equity swaps, and even defaulting on debt; third, redistributing wealth through anti-corruption efforts and various means of robbing the rich to help the poor, thereby increasing the unit value of social wealth; and fourth, continuing to print money to address weaknesses, balance industrial structures, and enhance public expectations for the future.

　　However, the current high leverage is a product of global financial liberalization, and the scale of the bubble created by worldwide credit expansion is many times larger than the total number of bubbles accumulated over thousands of years. Currently, the Federal Reserve's interest rate hikes and capital repatriation are essentially transferring the burden of this century's massive bubble, the scale of which is unbearable for any economy using traditional methods.

　　If political maneuvering cannot influence international capital rules, the ideal choice for an independent economy is to allow the credit bubble to softly land—that is, to buy time, essentially using the future income of the entire society to repay past debts—a remarkably long process.

　　However, by shifting our thinking, we can discover that the industrial internet can solve this problem. Through innovation in capital forms, we can release massive amounts of hidden social resources, reallocate idle assets, activate social value creation, and offset high leverage with newly generated social wealth. Then, all problems will become new opportunities in the new era.

　　—-Excerpt from Liu Shaodan's "Internet Revelation"

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