[AZLiberty]

Hooray! We’re “too big to fail”.

[SeekAndFind]

Folks, Here’s the thing to keep in mind -— It’s a symbiotic financial relationship.

tWe are China’s largest customer, and since many smaller customers also settle their international trade in U.S. dollars, roughly 70% of China’s $3 trillion reserves are in dollars. In theory, it could sell some of those dollars for other currencies or for commodities, like gold or oil, but in practice, given the huge sums they are already holding, its hard for China to sell off even some of its dollars without undermining the value of what it has left.

Even if it could do that, there just aren’t any markets that are as large or liquid as the market for U.S. Treasuries, to accommodate the amounts of money we’re talking about.

Unless they want to kill their economy, they can’t just dump our dollars even if they wanted to. WE DIE, THEY DIE WITH US.

[AZLiberty]

Is this the financial equivalent of “mutually assured destruction”?

[cranked]

No doubt, according to the faulty logic of Patrick Chovanec, China has no choice but forever keep loaning the US trillions, huh? Stuck on stupid has a new meaning apparently. =.=

[sinanju]

So despite all the speculation about the chicoms dumping dollars for gold, oil, commodities, etc.

Or for Little Red Riding Hood’s “basket of currencies”, they can only convert so much before killing the value of what’s remaining.

So we’re stuck with each other, handcuffed together on Thelma and Louise’s Cadillac.

[Mr Ramsbotham]

They’re shipping us goods and we’re shipping them green pieces of paper.

[flowerplough]

Unless they’re suicidal, or, like TEA Party congressmen, devoted to principle over party, and care for their country more than their comfort, hayna?
Or no?

[yefragetuwrabrumuy]

There are some truly insane ideas about Chinese demands for additional collateral from America.

“Project 60”, under the Republican governor of Idaho, Butch Otter, the State has sold 50 square miles south of Boise to the Chinese. Importantly, as part of the deal, an undetermined number of Chinese workers would receive permanent resident status in the US.

“The U.S. Citizenship and Immigration Service administers an immigrant investor visa program called EB-5. The program grants foreigners permanent U.S. residency in exchange for helping create U.S. jobs.”

Put simply, Idaho (and reportedly other states, as well) are offering the Chinese a way to dump their useless treasury bonds by buying ownership and domestic US production rights (by Chinese citizens) in their States.

American Falls, Idaho will soon be home to a Chinese-owned fertilizer plant. The 50 square miles south of Boise will be used to produce fertilizer to sell in the US, a purchase Idaho’s governor promises will “reinvigorate our American industrial base.”

Utah seems to be next on the list for collateral.

[Bobalu]

China getting out of US treasuries could be a sign they were going to move on Taiwan IMO.

Otherwise we would write the notes down to 0.0 value.

[FightThePower!]

I hope China dumps US debt. It would make it difficult to have a massive Federal government if no one would loan us money. If you want small government, you should pray that China and every other creditor is unwilling to loan us money.

[AEMILIUS PAULUS]

I see those that think only in economic terms believe China cannot sell our notes. The pure economic thinker always overlook the political and/or social impact of their theories. We have already seen the Chinese buying the Clintons. I have heard that a majority of the California State Supreme Court is now Chinese. The Chinese are flooding the country, whole towns in Southern California are now Chinese i.e Monterey Park, South Pasadena. Vancouver, Canada is gone. Our military recently had problems buying some necessaries because we no longer could make them them and foreign countries would not sell them as the foreign countries did not approve of American policies. (Britain could not get hand grenades because they could not make them and the Swiss would not sell them.)

We will soon lose-if we have not already- our capacity to recover; as there will be few left with technical knowledge, skill and experience i.e. machinists, engineers etc. The so called "Free Trade" fanatics are helping to ruin our country. Between the imbecile elected to be President and all the hacks he brought with him plus the Free Trade fraud we are DYING AS A NATION!!!!!!! Even the economic "thinker" has to consider a partial dump by the Chinese. However, why should they dump as the Chinese are certainly one of the coalition that is conquering America and will participate in the final sack, rape and mass killings. That is the real reason why they will not dump as they are winning!

[familyop]

Baloney. The Chinese have already dumped much of it and will dump the rest in due time.

[Mike Darancette]

I’d rather be invested in U.S. Treasuries than Chinese Railways.

[Mike Darancette]

The result is that foreign currency flows into China and piles up, with no outlet to flow back out again.

China uses the surplus to build "Ghost" cities, infrastructure and aircraft carriers. Remarkable what you can do with free land, cheap/slave labor and lots of loose cash.

tick, tick, tick.

[wolfman]

I think it is entirely possible that either one of the ‘unthinkables’ could happen. China could make a pre-emptive sell on the Dollar. The US could default.