Uh Oh

By Justin Gardner | Related entries in China, Money

Will this day ever come?

Discuss.


This entry was posted on Wednesday, January 7th, 2009 and is filed under China, Money. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

7 Responses to “Uh Oh”

  1. gljunket Says:

    Yes, Mr PE-O, it will come due. With T-bill interest virtually zero, no end in sight for debt reduction, the dollar will crash, and we can’t spend our way out of a mess created by over-spending! And you think another Trillion will help?

  2. kranky kritter Says:

    Hello, China? Yeah this is the U.S. We’re sending you an aircraft carrier full of freshly printed deflated dollars. Thank you for buying our bonds and treasury bills.

    We look forward to doing more business with you in the future so that you can keep making crap for us to buy at christmas tree shop.

    Deal?

  3. ExiledIndependent Says:

    Yep.

  4. Duncan Says:

    You know, it’s impolite to take something off a website and manually crop off the photo credit. The people at Pundit Kitchen deserve the credit for coming of with the caption on that image.

  5. Trescml Says:

    Some day China may try it, but it risks sinking its own economy by doing so. It is somewhat like economic mutually assured destruction so far as it will send the US in a tailspin but that would likely cause a global depression which would ruin China’s economy.

  6. John Burke Says:

    Never say never but it’s not something that will happen in the foreseeable future. The U.S. market is handily China’s biggest export market, and exports sustain and drive China’s economic growth. Export earnings also provide an enormous subsidy to the other half of the Chinese economy, dominated by state-owned enterprises and farming. Without this subsidy, social discontent in China’s interior, already a bubbling problem, might become hard to manage.

    What’s more, China’s investing of dollars in US Treasuries and private-sector US securities represents for China the most secure way to manage their money. With all our own economic problems, we tend to forget that the US is still an island of relative tranquility in a world of turmoil.

    On top of that, US companies and investors have been making capital investments in China for 25 years — and this flow of capital (as well as knowhow in some businesses) is not something China would want to sacrifice anytime soon.

    Theoretically, if China and other overseas purchasers of US securities were to stop buying and start selling, financing US deficits would get a lot harder. Theoretically, if American banks, businesses, mutual funds and individuals were to sour on Treasuries, that would also make it harder. But there is no reason to believe either will happen. US Treasury obligations have stood every test — or war and depression — for more than a century.

  7. gljunket Says:

    If you take comfort that “we’re OK because everybody else is worse” check this out: http://www.bloomberg.com/apps/news?pid=20601109&sid=aCwkfpvso_uo&refer=home

    We will choke on this Keynesian Stimulus attempt at a lifestyle.

Leave a Reply


NOTE TO COMMENTERS:


You must ALWAYS fill in the two word CAPTCHA below to submit a comment. And if this is your first time commenting on Donklephant, it will be held in a moderation queue for approval. Please don't resubmit the same comment a couple times. We'll get around to moderating it soon enough.


Also, sometimes even if you've commented before, it may still get placed in a moderation queue and/or sent to the spam folder. If it's just in moderation queue, it'll be published, but it may be deleted if it lands in the spam folder. My apologies if this happens but there are some keywords that push it into the spam folder.


One last note, we will not tolerate comments that disparage people based on age, sex, handicap, race, color, sexual orientation, national origin or ancestry. We reserve the right to delete these comments and ban the people who make them from ever commenting here again.


Thanks for understanding and have a pleasurable commenting experience.


Related Posts: