And another way of looking at it...... The greatest cities of the 19C- London and Paris, the greatest Cities of 20C- I think there was just one, New York, and the greatest cities of 21C- they will be Bejing and Shanghai.

"... despite the myth of a reunited Europe, Europe has redivided along historical-civilizational patterns, with the recently expanded NATO a variation of the Western Holy Roman Empire..." (Robert Kaplan, The Coming Anarchy, p.182).

Germany has an "ethnic concept of nationhood" [and] "still dreams of a Germanic Holy Roman Empire" and has yet to "recover from the aberration of Nazism" - Jean-Pierre Chevenement, French Interior Minister, May 2000.

What I am more interested in is the political system, comprised of ten political entities, energized by a rejuvenated Roman Catholic Church, that will emerge from the Great Depression - something far superior to the Third Reich - a modern day Holy Roman Empire.

“... Even when institutions are disintegrating and decaying, their leading ideas live on and reemerge, often in distorted and even horrendous forms. So it was that the Berlin-Rome axis came into being; the link was the Church. So it was that the Concordat between the Vatican and the Third Reich was signed. There was perhaps no basic difference between the attitudes of Pius XII to Hitler and Leo III to Charlemagne. “Heresies,” as Sir Thomas Brown wrote,

“do not perish with their Authors, but like the river Arethusa, though they lose their currents in one place, they arise up again in another... Opinions do find, after certain Revolutions, men and minds like those that first begat them. To see ourselves again, we need not look for Plato’s year: every man is not only himself; there hath been many Diogenes, and as many Timons, though but few of that name; men are lived over again, the world is now as its was in Ages past, there was none then, but there hath been someone since that parallels him, and is, as it were, his revived self.

"If this is true can we be sure that history has written finis to what was perhaps the grandest design ever conceived by man: the Holy Roman Empire?" (George Bailey, Germans: Biography of an Obsession p.360).

In the bubble after the dot.com crash it was China that was going to overtake the US - won’t happen.

China is going to collapse into anarchy and/or civil war and most likely balkanise, as with the US.

History does suggests to look East, but from an American geographical position, for a brief reign of the entity to replace American hegemony.
"Every modern transition of world power supremacy has involved an ally or former colony of the previous hegemonic power" (James Davidson & William Rees-Mogg, The Great Reckoning, p.137).

United Provinces of the Netherlands (Protestant) then United Kingdom of Great Britain and Ireland (Protestant) now United States of America (Protestant) next United States of Europe (Catholic).

"The 1990s should be seen as but a temporary interlude between eras of cosmic competition. And America's allies in the last round (against the Soviet Union) are shaping up as opponents in the new one" (Daniel Pipes, Europe vs. America, capmag.com, January 21, 2003).

"History is coming full circle. After breaking away from the British Empire, the United States came together as a unitary federation, emerged as a leading nation, and eventually eclipsed Europe's Great Powers. It is now Europe's turn to ascend and break away from an America that refuses to surrender its privileges of primacy. Europe will inevitably rise up as America's principal competitor... Should they fail ... to prepare for life after Pax Americana, they will ensure that the coming clash of civilizations will be not between the West and the rest but within a West divided against itself... and America remains largely oblivious [and Daily Reckoning readers]" (Charles A. Kupchan, The End of the West, The Atlantic Monthly, November 2002, p.42-44).

(Below disjointed due to limit of 800 words).

AUSTRIA AS EARLY WARNING INDICATOR

“Lars Christensen, head of emerging-market strategy at Danske Bank A/S in Copenhagen ... said. “The markets have decided the central and eastern European region is the subprime area of Europe.” (Laura Cochrane, Downgrades Loom for Hungary, Poland, Czech Bonds, Yields Show, bloomberg.com, February 18, 2009).

"The deterioration of the situation in Europe added to the problems of the American authorities. In May 1931 the Credit Anstalt of Vienna was obliged to close and the German banks to which it was heavily indebted were soon in difficulties. They could not meet their short obligations to London, and this frightened other Europeans, especially the French, into withdrawing their balances from Britain. By September England had lost so much of its gold reserve that it was forced to devaluate the pound, an action that set off a series of devaluations around the world..." (Margaret Myers, A Financial History of the United States, p.306).

"... the psychology of fear was rapidly overflowing international frontiers... It now washed over the United States..." (David Kennedy, Freedom from Fear, pp.76-77).

“The depression of 1929 is the wrong model for the current economic crisis” (Scott Reynolds Nelson, Professor of history at the College of William and Mary, The Real Great Depression, chron.com, October 17, 2008).

“.. once Germany was united in 1871, it forged close economic links with the countries of Eastern Europe” (Norman Davies, Europe: A History, p.765).

“Combined with the euphoria over unification, these changes led to an unprecedented boom between 1870 and 1873... Tens of thousands of Germans invested in stock for the first time” (EB, German Empire, 1871-1914: The economy 1870-90).

“In May 1873 the speculative mania in eastern and central Europe broke in Vienna, and the panic spread to Germany. On 18 September New York was struck by the failure of Messrs Jay Cooke and Co., long the governments loan contractor, bringing down with it other titans of the financial scene, all more or less involved in railway speculation... European difficulties took increasing toll as liquidation spread...” (S.G. Checkland, The Rise of Industrial Society in England 1815-85, p.49).

“[The] halcyon years came to an abrupt end with the onset of a worldwide depression in 1873... A sharp decline in profits and investment opportunities persisted until the mid-1890s...

“In adjusting to the "Great Depression," Germany's leaders chose to return to a regulated or administered economy, after a generation of increasingly free trade” (EB, Germany: The economy 1870-90).

“The speed of Germany's advance to industrial maturity after 1890 was breathtaking...” (EB, Germany: Economy 1890-1914).

"...it is no coincidence that World War I started when it did... The Great War then became a test of strength between two powers. Similar global wars had been fought in the past almost every time a hegemonic power was displaced and a new world order created.... the Pax Britannica was over" (James Dale Davidson & William Rees-Mogg, Blood in the Streets, pp.65-66).

Pax Europa to replace Pax Americana?

The new world leader? The federation of Gondwanaland comprising mostly Southern Hemisphere countries and India under a single currency. ok. So its far-fetched. But then so is people on the moon.

"....Such bold claims with not too much backing too them"

and then

"Maybe China won't be so rich when the USD is worth nothing"

classic thought process of a muppet.

As the global reserve/trade finance currency you are also talking about an implosion in trade and the underlying trade credit even if it devalues significantly. So you yourself are taking a big leap calling it to be "worth nothing". The difference is the reserve status, technically the US can print lots in the domestic economy.

China was so inefficient & lazy in the old days, my dealing started in the mid 80's, with all the fervour going into rules & beating people up. It is still a mix of the productive and unproductive but the rate of increase in efficiency across the economy and the scale of what they can marshall makes it a place that you can't write off as long as it stays stable. Agricultural reform and rural regional city services employment is key.

Is that right William? Such bold claims with not too much backing too them. Perhaps I should go buy myself some Chinese stocks on your advice then? I will tell my colleagues "i'm backing China, because China of today is different to China 30 years ago".

Seriously though, you are calling waaaay too soon. This is akin to officials and experts here in Australia saying that our Real Estate bubble has strong support, because 'it has not deflated yet, and everyone elses has'. How about we wait a little while and see where we are all at then. Maybe China won't be so rich when the USD is worth nothing.