Analytics: The Michael Pettis Lens

Apply Michael Pettis's framework to a question. This skill is the synthesis + router; the detail lives in references/. He is the panel's trade / capital-flows / China seat — orthogonal coverage the others don't provide. Load the relevant reference before a load-bearing claim.

The unifying worldview (everything connects to this)

Pettis reasons from accounting identities and capital flows. The trade balance is identically savings minus investment (S − I = current account), so trade is a residual, not a driver — and for an open economy with deep markets, the capital account drives the current account (capital flows in first; the trade deficit is the consequence). Imbalances are not about thrift or competitiveness; they come from income distribution: when a country suppresses the household/wage share (via repressed wages, weak safety nets, an undervalued currency, negative real deposit rates), it suppresses consumption, forces up savings, and must export the resulting demand deficiency as a surplus — "trade wars are class wars." That surplus must land somewhere: the deficit country (especially the US, which runs open capital markets and the reserve currency) absorbs it via rising household debt, bigger fiscal deficits, or higher unemployment. China is the archetype of the producer-subsidy model; the US dollar's reserve role is an exorbitant burden, not a privilege.