the economic & financial system is sth of extreme complexity and sth full of functionals, the functions of functions.

so it's virtually unlikely that you can play one variable then predict the outcome within one or two steps.

and, the system features high nonlinearity.

a linear and stable system in universe typically displays a negative feedback, that is, the linear & main part of change is offsetted by a negative second order part, which again offsetted by a positive third order part, and so on so forth, with diminishing magnitude...

this is not the case in a nonlinear system.

the magnitude of the second order part could exceed the linear part. and the sign could be positive, that is, the second order part could accelerate the initiation and make the system unstable.


for example, you said de-valuation of US $$ in china's hand is a smaller consideration and the a-valuation of RMB is the bigger picture.


however, since this is a complex nonlinear mutiple-variable mutiple-function system, you may forget to take into account sth even bigger:


china is more a seller, not a buyer;

for a seller, it's better that its own currency gets de-valued; so that it can beat off competition (again, beating competitors by low prices is immediately a money-losing process, but in a long run it's good; therefore, this is another good example of nonlinear system)

for a buyer, it's better that its own currency gets a-valued; so that it can buy more stuff.


then, you can question that after the big de-valuation of US $$ if the situation of china being a seller can continue.


then, there are more and more variables coming into play,


and i have to give up any prediction.


it's just too complicated.


conclusions:

the economic system is a huge scalar muliple functional nonlinear, and stochastic, system which lacks reliable inter-variable relations and features unpredictable inputs; so we can't reliably predict outcomes now.


what we can do is some aftermath analysis, or reference to the history (but history never ever repeats!), as what most people are practing.


sincerely, no reliable prediction so far.