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Could China Crash the US Dollar on a Whim?

I haven't even read this article - only the first paragraph, and I am laughing. You compare this Chinaphobia with Japanaphobia that turned out to be nothing, then you dismiss that as a non-relevant fact for another discussion. China's economy is more dependent on the U.S. than we are on China. Sure 80% of our toys come from China, but we can get by without plastic fantastic toys for our children. Everything we import from China could be cut off and we would be just fine. No TVs, no game systems, no poison toothpaste. We don't import anything critical from China that could not be easily sourced somewhere else. We actually would emerge better off than ever. China on the other hand would be crippled trying to replace the U.S. market for its goods. If China did somehow crash the dollar it would be fine. Smart U.S. investors have a lot of international exposure right now and would see the value of those holdings increase. Oil prices would increase dramatically but all the money we would be saving not buying Chinese imports could cover that expense. It would also continue the trend towards investment in alternative/renewable/... energy sources and wean the U.S. off foriegn oil. Our exporters would be much more competitive globally - we are the breadbasket for the world. Maybe I should go read your article before I make all these comments. It is just that you summed up the whole thing when you said Japanaphobia turned out to be nothing. China's domestic economic boom, while real, is fueled by government spending. This is possible because of China's robust trade with the U.S. If we stop buying China, their boom is over, and they know this.