2019-08-25 at 1:52 AM UTC
Not discussing politics with an idiot like you speedy, move along!
2019-08-25 at 2:12 AM UTC
Speedy Parker
Black Hole
[my absentmindedly lachrymatory gazania]
Originally posted by Technologist
Not discussing politics with an idiot like you speedy, move along!
Typical leftist argument. "Your too dumb to understand how smart I am so I'll choose for you".
The following users say it would be alright if the author of this
post didn't die in a fire!
2019-08-25 at 2:15 AM UTC
We’ve already discussed this, but you’re a trump supporter so I guess I have to explain it again.
You are a troll, nothing more than a troll. You get your thrills out of trying to start shit.
You are not worth the time of day.
Buh bye
2019-08-25 at 8:49 PM UTC
US Debt to China, How Much It Is, Reasons Why, and What If China Sells
Why China Is America's Biggest Banker
•••
By Kimberly Amadeo
Updated August 01, 2019
The U.S. debt to China is $1.11 trillion as of May 2019. That's 27% of the $4.1 trillion in Treasury bills, notes, and bonds held by foreign countries. The rest of the $22 trillion national debt is owned by either the American people or by the U.S. government itself.
China has the greatest amount of U.S. debt held by a foreign country. Japan comes second at $1.10 trillion. It's followed the United Kingdom at $332 billion, Brazil at $306 and Ireland at $271 billion.
Long-term, China wants the yuan to replace the U.S. dollar as the world's global currency. China is also responding to accusations of manipulation. Most countries want their currency values to fall so they can win the global currency wars. Countries with lower currency values export more since their products cost less when sold in foreign countries.
Before February 2014, China had been strengthening the yuan to dollar conversion in response to U.S. pressure. But it reversed course when the dollar rose 25% in 2014 and 2015, creating an asset bubble. Since the yuan's exchange rate was fixed to the dollar, the increase dragged the yuan's value up with it. China had to manually lower the yuan's value to remain competitive with other emerging markets that had free-floating currencies.
How China Became One of America's Biggest Bankers
China is more than happy to own almost a fifth of the U.S. debt owned by foreigners. Owning U.S. Treasury notes helps China's economy grow. It keeps the yuan weak relative to the dollar. As a result, Chinese exports are less expensive than U.S. products. China's highest priority is creating enough jobs for its 1.4 billion people.
The United States allowed China to become one of its biggest bankers because Americans enjoy low consumer prices. Selling debt to China pays for federal spending that spurs U.S. economic growth. It also keeps U.S. interest rates low. But China's ownership of the U.S. debt is shifting the economic balance of power in its favor.
Why China Owns So Much U.S. Debt
China makes sure the yuan is always low relative to the U.S. dollar. Why? Part of its economic strategy is to keep its export prices competitive. It does this by holding the yuan at a fixed rate compared to a "currency basket" of which the majority is the dollar. When the dollar falls in value, the Chinese government uses dollars it has on hand to buy Treasuries. It receives these dollars from Chinese companies that receive them as payments for their exports. China's Treasury purchases increase demand for the dollar and thus its value.
China's position as America's largest banker gives it some political leverage. Now and then, China threatens to sell part of its debt holdings. It knows that if it does, U.S. interest rates would rise, slowing U.S economic growth. China often calls for a new global currency to replace the dollar, which is used in most international transactions. China does this whenever the United States allows the value of the dollar to drop. That makes the debt China holds less valuable.
What Happens If China Called in Its Debt Holdings
China would not call in its debt all at once. If it did, the demand for the dollar would plummet. This dollar collapse would disrupt international markets even more than the 2008 financial crisis. China's economy would suffer along with everyone else's.
It's more likely that China would slowly begin selling off its Treasury holdings. Even when it just warns that it plans to do so, dollar demand starts to drop. That hurts China's competitiveness. As it raises its export prices, U.S. consumers would buy American products instead. China could only start this process if it further expands its exports to other Asian countries and increases domestic demand.
China's Debt-Holder Strategy Is Working
China's low-cost competitive strategy worked. Its economy grew 10% annually for the three decades before the recession. As of 2018, it's growing at almost 7%, a more sustainable rate. China has become the largest economy in the world, outpacing the United States and the European Union. China also became the world's biggest exporter in 2010. China needs this growth to raise its low standard of living. Despite its threats, China will continue to be one of the world's largest holders of U.S. debt.
2019-08-25 at 9:01 PM UTC
Sudo
Black Hole
[my hereto riemannian peach]
tariffs are literally socialism
2019-08-26 at 2:13 AM UTC
Trump is the real deal ladies and gentleman. He doesnt owe anyone shit. Unlike most all politicians. He truly cares for this country and you left wing faggots should shut your fucking mouth and learn a little from this incredible man.
