reply to post by goukilock
You would have been far better off by putting your foot in your mouth.
Also, China owns very little U.S. debt as a percentage of the GDP. China only owns less than 6% of all of the U.S.'s outstanding debt.
U.S. Treasury website:
Also, the debt is not at historic levels as a percentage of the GDP. Also, the debt to GDP ratio is currently declining. And many other first world
countries have far greater debt to GDP ratios.
If China had owned a lot of U.S. debt then they would have drove up the price of treasury securities (bonds, etc). That didn't happen. Currently the
price of treasuries have been increasing because people are taking their money out of the stock market and investing in treasuries.
Many U.S. investors want China to sell off the U.S. debt because in the long term it will decrease the trade deficit (improve the stock market, boost
home prices, increase consumer spending, increase job growth, etc.)
Why does china buy so much US debt? China only buys our debt to devalue its currency so it can create an artificially created trade deficit. So china
buying US debt is in Chinas best interest, if china wants strong economic growth, that is.
Embarrassed yet? I am pretty much thrashing your original "arguments." Though i will not continue to beat you when you have been thoroughly beaten
About the "Micky mouse dollar." Japan is thinking about selling off its yen to boost the value of the dollar so Japan can sell more Japanese cars in
the U.S.. "Japan sold the yen on the four occasions since 1995 when the currency approached 100 to support exporters including Toyota, the world's
second-biggest automaker." ...
Contrary to what most people think, a weak dollar is not bad for America. It helps U.S. automakers and manufacturers. It also reduces the trade
deficit which reduces unemployment and the national debt. The dollar is fine. The falling dollar helps the economy.
A weak dollar does not make foreign car makers happy. Each time the Japanese yen increases to the dollar by one yen, then Toyota's profits drop by 35
Global economics 101. The country with the weakest currency wins. And the country with the most innovation (the U.S.) keeps alive the countries that
only know how to copy ( through the use of a devalued currency) .
The countries with the weakest currencies have the fastest economic growth. Japan purposefully devalued its currency for decades to gain U.S.
marketshare in our automotive sector and our electronic sector.
China and India are currently devaluing their currencies. China had over a 10% GDP growth rate last year. And Russia's devalued currency is hurting
the EU steel mills.
The key to America's future is spending money in research and development and at the same time preventing other countries from artificially devaluing
their currencies. Those actions alone will increase job growth, improve the standard of living, reduce the need of social programs, reduce the
national debt through tax revenue growth, etc..
In the long term a low dollar is actually good for America (as long as other countries don't artificially peg the dollar). A low dollar decreases the
trade deficit, improves the economy, and increases tax revenue to lower the budget deficit. China has been enjoying the benefits of a weak currency
for a decade. That is the only reason why China is doing so well. It actually sucks at productivity.
China Is Against Free Trade. They are taking what we are allowing. I am in agreement that something needs to be done about this.
[edit on 19-4-2008 by West Coast]