IN HIS new book “Super Sad True Love Story”, the novelist Gary Shteyngart depicts a future in which an overstretched America depends on the forbearance of its Asian creditors. That scenario is not, sadly, a great test of the author's imagination. In this fictional world, America's currency and China's are still closely linked. But nervous Americans peg their greenbacks to the yuan (worth about $4.9), not the other way around.

America presents a “grave risk to the international system of corporate governance and exchange mechanisms,” says a Chinese central banker after a trip to New York. That is from the novel. The “international currency system is the product of the past,” says China's president before a trip to Washington, DC. That is from real life. In response to a question posed by the Wall Street Journal and the Washington Post, Hu Jintao echoed a complaint made by the (real) governor of China's central bank, Zhou Xiaochuan, in 2009. The financial crisis, Mr Zhon said back then, reflects the “inherent vulnerabilities and systemic risks in the existing international monetary system.”

These observations are partly political, of course. America has long complained about China's cheap currency, raising the issue at multilateral forums like the IMF and the G20. China has taken to responding in kind. If America is going to gripe about the yuan's rate, then China will complain about the dollar's role.

What is that role? The dollar is more than just a reserve currency. For many countries, it is a “key” currency. Their exchange rates revolve around the dollar, just as the notes on a scale centre on a musical key. Their governments fear that if their currency falls too far against the dollar, inflation will take hold or the country's dollar debts will become too heavy to bear. If their currencies rise too far against the greenback, their exporters will lose out wherever customers pay in dollars.

But the dollar is not always perfectly pitched. Mr Zhou and President Hu worry that America is printing too much money to try to revive its own economy, regardless of the consequences abroad. To stay in tune with a falling dollar, other central banks will have to print more of their own currency, risking inflation and asset-price bubbles. “The monetary policy of the United States has a major impact on global liquidity and capital flows,” Mr Hu told the Journal and the Post, “therefore, the liquidity of the dollar should be kept at a reasonable and stable level.”

Mr Hu admitted that making the yuan “an international currency will be a fairly long process.” Still, that process has begun. His government now seems keen to promote the yuan in international trade. In June it allowed most of the country to pay for imports in yuan and 365 Chinese companies to sell exports for the currency. Last month, it expanded the number to 67,359. By the end of November, trade worth 385 billion yuan ($58 billion) had been settled in China's currency (see chart).

About 80% of these transactions involved exports to China not imports from it. Foreigners seem keener to sell stuff for yuan, rather than buy stuff with them. As a result, a stream of yuan has flowed beyond China's borders, most of it collecting in deposits in Hong Kong. This offshore pool of “redbacks” is still small but is becoming deeper and more liquid. In Hong Kong, yuan deposits probably reached 300 billion by the end of 2010 (see chart).

Once offshore, these redbacks can frolic in Hong Kong's free markets. They can be bought, sold, borrowed, lent, swapped and hedged. A growing list of issuers, from McDonald's to the World Bank, have sold so-called “dim sum” bonds in Hong Kong in order to borrow these offshore yuan. But the mainland remains enclosed by a levee of regulatory controls. Yuan can leave the mainland in payment for an export to China; they can return in exchange for an import from China. But all other routes in and out are tightly controlled.

In August the government said that certain lucky banks could invest some of their offshore yuan in the interbank bond market on the mainland. This month it said that companies making direct investments abroad—acquiring foreign firms or building foreign factories—could pay in yuan. Likewise, it permits companies that have raised yuan offshore to invest the proceeds on the mainland, but only in their own operations or other direct investments. The process is unpredictable and can take weeks or even months, says Donna Kwok of HSBC, which is partly why so few mainland companies have borrowed offshore, despite the cheap rates on offer.

China seems happier to allow capital to flow in the opposite direction. Its banks are pushing yuan loans and trade credits, especially to customers in emerging economies. But lending in yuan is not as easy as China might wish. When India's Reliance Power ordered equipment from Shanghai Electric, three Chinese banks offered the Indian firm a loan of $1.1 billion over more than 13 years. The deal demonstrates China's manufacturing prowess and its prodigious ability to lend. But it also reveals how far the yuan has to go. Less than 0.5% of the loan was in yuan. The rise of the redback will be a super, true story. But as Mr Hu cautioned, it will also be a long one.