From: Adrian Tymes (wingcat@pacbell.net)
Date: Wed Sep 03 2003 - 15:18:49 MDT
--- Randy S <cryofan@mylinuxisp.com> wrote:
> Adrian Tymes <wingcat@pacbell.net> said:
> > Cute. Instead of nuclear Mutually Assured
> > Destruction, we're playing with financial Mutually
> > Assured Destruction. One wonders if this is
> perhaps
> > more dangerous, because a short-sighted leader on
> > either side could see that immediate war would not
> > have consequences until at least the next
> budgetary
> > cycle, which could be beyond the present leader's
> term
> > in office - especially on the US's side. (See the
> > present administration's troubles in that regard.)
> > But, that aside, it is far safer for those not in
> > power.
>
> It seems as if CorpGovMedia wants to keep this fact
> out of the public eye.
> The fact that China apparently answered Snow's
> urging to float the yuan with
> a threat to stop buying treasuries was only reported
> in place that I saw. If
> you search google news for
> "China"+"float"+"currency", you get 161 hits, but
> only 2 if you add "treasuries", you only get a
> couple of hits. But I am
> quite sure that Chinese officials have threatened to
> stop buying American
> treasuries if Snow pressures them further.
Well...to be fair, even if this does represent a good
portion of the annual federal deficit, it's also only
about 1% of the total US debt. Which means a one-time
purchase of US gov't securities would only have force
if China buys the same amount year after year, but
this seems more like a one-off measure on China's
part. Now, if China were to buy a good portion of the
overall US debt - say, ~$700 billion, upping their
stake to 10%, or better yet ~$3.5 trillion - then
they'd have something. But as it is now, the US could
write off China's investment much more easily than
China could write it off.
"When you owe the bank a little, the bank owns you.
When you owe the bank a lot, you own the bank."
This archive was generated by hypermail 2.1.5 : Wed Sep 03 2003 - 15:36:30 MDT