Image from Dave Manuel.com
What If China Stops Buying U.S. Government Debt? -- Gordon G. Chang, Forbes
Just about everyone worries that Beijing, perturbed by the ongoing squabble in Washington, will sour on Treasuries. This concern is embedded in the provocative title of Eamonn Fingleton’s recent Forbes posting: “If Republicans Want to Shut Down Washington, They’ll Have to Ask China’s Permission First.”
The Republicans in fact did not seek Beijing’s approval, and neither did Democrats. Are both sides making a mistake by not taking into account China’s “feelings,” as the Communist Party demands everyone do?
It’s clear Chinese officials are watching closely. “The United States, the world’s sole superpower, has engaged in irresponsible spending for years,” observed Xinhua News Agency in an editorial on Wednesday. “With no political unity to redress its policy mistake, a dysfunctional Washington is now overspending the confidence in its leadership.”
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My Comment: there will be a crisis .... but it will pass with time.
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