China Has Canceled America's 'Credit Card'
China, wary of the troubled US economy, has already "canceled America's credit card" by cutting down purchases of debt, a U.S. congressman said. China has the world's largest foreign reserves, believed to be mostly in dollars, along with around 800 billion dollars in US Treasury bonds, more than any other country. But Treasury Department data shows that investors in China have sharply curtailed their purchases of bonds in January and February.... [Full Story]Tags: China, credit, Treasury bonds, U.S. Treasury, United States To share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. Thanks!
Posted by Bill Smith at 11:40 AM - Post Link
7 Comments:
look at that chart....that's why . . . http://research.stlouisfed.org/fred2/series/AMBNS
Sooner or later, you knew the "bank" was going to call the loan! Bummer that we are not going to be allowed to join the European Union either because of our debts. Oh well, I kind of like keeping the U.S. Constitution around--but that's just me!
Here is the problem with your understanding. China uses our debt to finance and cover up bad loans to Chinese companies (old communist enterprises which employ most of the Chinese). And hace for the last 8 years. And they bought these bonds to cover this up with our trade deficit money... so they are buying less bonds because we are buying less of their product
How does China use buying "our debt" to finance and cover bad loans?
Ed: The payments the federal governments make on the bonds. Those payments cover most-all (depending on the year) of the bad loans to zombie communist firms in China
I also read the the Arab country is the next to stop loaning the U.S. money.
Do you think they will allow us to keep our stars and bars?
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