This analysis forecasts a significant economic downturn in China, largely attributed to a collapsing real estate sector and the government’s resistance to essential reforms, which creates systemic financial instability. As a result, global capital is expected to flee China in search of safer havens, with the United States dollar and U.S. Treasury bonds positioned as the primary beneficiaries due to their perceived stability and liquidity. This capital flight is anticipated to strengthen the dollar and increase demand for Treasuries, while also exporting deflationary pressures from China to the U.S., potentially impacting American corporate earnings and overall economic growth. The article advises investors to prioritize capital preservation over growth in this shifting global economic landscape.