China can't get enough US treasuries (buying, sell, companies, money)

[user_id]

Originally Posted by Read Culture of Critique

Why? Are you saying if they suddenly stopped purchasing our debt, we'd turn away all their cargo ships and suddenly reopen all our dilapidated/non-existent factories?

There would not be any cargo ships to begin with. If they stopped purchasing US debt, their currency would have to strengthen against the US dollar which would mean their products become more expensive which would mean some production would return to the US (or perhaps another country that wants to buy US products, or a chain of such transactions).

[le roi]

Originally Posted by user_id

So much yapping about this topic, yet its rather simple. So long as China runs a trade deficit with the US they will have to purchase US financial assets, the least risky being US treasuries. The only way China can stop is if they stop running a trade deficit.

China has a trade surplus with the U.S.

[Majordomo]

Originally Posted by rubber_factory

China has a trade surplus with the U.S.

and it's huge.

[cobolt]

Like a dealer feeding his junkie....

[user_id]

Originally Posted by rubber_factory

China has a trade surplus with the U.S.

Yes, obviously I meant to say the US has a trade deficit with China.

[Peterbndrs]

The pressure to payback will start mounting at some point of time. Then the country will be in immense trouble

[Visit a Library]

Originally Posted by user_id

There would not be any cargo ships to begin with. If they stopped purchasing US debt, their currency would have to strengthen against the US dollar which would mean their products become more expensive which would mean some production would return to the US (or perhaps another country that wants to buy US products, or a chain of such transactions).

That's one possibility. However, I believe you're assuming the transnationalists who have capital in the U.S. would not simply move their capital elsewhere.

[user_id]

Originally Posted by Read Culture of Critique

That's one possibility. However, I believe you're assuming the transnationalists who have capital in the U.S. would not simply move their capital elsewhere.

That's not a "possibility" that is how things work.

They are going to move their capital, how? Americans have dollar denominated capital, they can't just move it. Not unless you think there is a magic genie that will convert it into any other currency you want.

[Visit a Library]

Originally Posted by user_id

That's not a "possibility" that is how things work.

Then why was your post written in future tense?

[Visit a Library]

Originally Posted by user_id

They are going to move their capital, how?

They're already moving their capital via something called outsourcing.