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  • China Gets It Right, But Hurts America [View article]
    The author is correct. If China decides to start spending it's USTreasury debt and USDollar reserves on local development it will be very hard on the US.

    If they are selling US debt and dollars, then by definition they have stopped buying them. This will drive interest rates up for US debt and drive the value of the dollar down.

    Who will fund the US deficit if the Chinese stop lending us the money? If we can't borrow to fund the deficit, will we have the political will to cut gub'mint spending by 30% across the board, or will we simply start printing more dollars and risk hyperinflation down the road? Neither is a very good choice, but those will be the best options we have at that point.

    The US gub'mint and people have lived beyond their means for far too long. The bill is about to be presented for payment and it's going to be painful trying to find the money to settle our tab.
    Nov 13 10:06 am |Rating: 0 0 |Link to Comment
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