Posted on 02/27/2009 1:52:29 PM PST by pocket5s
Yep, the Obama administration has granted eminent domain rights to China as leverage for our debt.
(Excerpt) Read more at patriotroom.com ...
The Communist Chinese hold so much of our debt though. It’s as though they’re the holders of IOUs for a party in bankruptcy, with the US about there.
$14 trillion in national debt. Pastor Hagee explained that $1T = losing $1mm every day for every year since the birth of Jesus PLUS an additional 700 years. Times that times 14. Unreal, atmospheric debt.
They hold just north of $500b. I agree that the debt that Comrade Ogabe (Obama rolled into Mugabe, tyrant of Zimbabwe) has inflicted on us will present major problems for the US economy (and by extension, the Chinese economy). But it's not the debt that will kill us, it's the programs that Ogabe has set up that will be political poison to dismantle, just as Bush's mention of Social Security reform sank the GOP for the 2006 mid term elections. After Ogabe's multi-trillion dollar legislative bum's rush, the GOP will have its work cut out for it even if it wins majorities during the 2010 mid terms.
I must be thinking of the Communist Chinese holding in US Treasuries and futures then. I was having a discussion with someone about this and now I don’t remember particulars.
The $500b odd Chinese holdings of Treasuries aren’t a big problem, either for the Chinese or for us. They’re not a problem for the Chinese because Treasuries are the most liquid income-producing asset in the world. If they put that in gold, they would end up buying at $10000 an ounce, an asset that produces no income, but incurs storage costs. And if they need to sell, prices go back down to $1000. They’re not a problem for us because if the Chinese sell their Treasuries, yields will go up a little, but other investors will buy. It’s no different from how some people will stick with a savings account if 12-month CD’s are at 1% but go into CD’s if yields go to 2%. If the Chinese sell their Treasuries or stop buying any more, Uncle Sam will have somewhat higher financing costs, but life will go on.
Tsai lai eeping pidjio. :)
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