Quote Originally Posted by wallstreetcappers:
Why would China dump US debt which yields more and is much safer than European debt?
The EU has pushed rates down for all and nearly any european debt...the value is not there in yield or safety to do what this thing suggests.
If China is stupid enough to dump a higher yielding, safer debt for Euro junk then I have to doubt they have any ability to create this currency these blogs suggest.
Also, China is an unstable country and economy..they will bust and since we dont know the true level of government solvency the magnitude of the bust could be enormous. I do know there is no way another country outside China could front the bill for all the phony building and developing infrastructure that China has and be able to stay afloat from an economic perspective.
Inflation is going to chew China up in such a bad way and when you add the debt and leverage to it, the day of reckoning is going to be so bad...
The US wont allow china to purchase buisnesses or hard assets here
China wanted to buy General motors in exchange for the debt it held it leveraged to buy out the governments stake in the company this was squashed, it wish to purchase rail roads buildings mines ports all denied so what is having 2.3 trillion dollars worth if you cant buy anything in the us....
Belgium doesnt have this delima it now owns anhuser bush, a quarter share of disney, Italians have no problem having fiat now controling interests in chrysler.
American tresury notes are currently less than five percent on a thirty year term, but german sweden norway all well above 7 % thresh hold with a greater concern to pay debt
Republicans brinksmanship allowed our credit rating to slip to a french position aa plus switzerland germany norway belgium sweden netherlands all at aaa to aaaa and paying more interest than usa.
and in the end what does interest mean if you cant purchase hard assets, The problem this is encountering is last federal stance a dollar made to colonial times is still worth its face value, we never rolled over the currency china must meet this last hurdle before a true reserve can emerge.
But the original maker of paper money has been in the game longer than the anglo saxons invaded britian.