Chips, together with aerospace were basically the last things the Chinese, and everybody else, needed to buy from the West. Once they have these last few industries in the bag, Western money will be worthless outside the West.
You're making the same mistake Karl Marx did in his economic predictions: assuming technology remains static, and ignoring the knowledge generated by market competition.
If the West were to stop inventing stuff, then what you say would be true. Or if China were to become as good at inventing stuff as the West is. The reason the West is better at inventing stuff than China is exactly because open, democratic societies with competitive marketplaces are better at it than controlled, non-democratic societies with central planning. China made great strides for a couple of decades precisely because they opened up and engaged in capitalism, but Xi Jinping has realized that they can't continue any further down that path without abandoning their political system, and he's putting the brakes on it, hard.
Assuming Xi and the CCP continue in power, the West will retain its technological lead, and Xi's recent moves make it likely that the lead will expand. Or course, China can close the gap if they become an open, democratic society with competitive marketplaces, but the West would largely be good with that.
The big risk right now is that the West has in many ways outsourced its manufacturing to China. Even if we continue doing that it won't enable China to close the technological gap, but it means the West is currently at a huge disadvantage if the conflict turns hot. If we were to go to war with China right now, we'd be in the position Germany was when the US entered WWII, facing an opponent with orders of magnitude greater manufacturing industry. Yes, the Europe and especially the US do still do a lot of manufacturing today, but it's mostly at the high end and depends heavily on inputs from China. We need to mitigate that risk, probably by helping other developing countries build manufacturing capacity. The problem is that sort of thing takes a couple of generations.