China gets stimulated & tosses Treasuries off!

Discussion in 'Chit Chat' started by JMartinez, Mar 5, 2009.

  1. Wouldn't they start selling off their US Treasuries to get stimulated?

    Doesn't really sound too good.

  2. A BBC reporter who just toured China is on the radio right now saying the unemployment rate in China is incredible, as is the gloom among the working class.

    He said there are shut down factories as far as the eye can see, and the government is very worried.

    Jim Rogers may have misjudged the situation, after all.
  3. No, no. He's in it for the long haul. :D
  4. China is a house of cards. No rule of law, communist and no religious foundations to give structural support to society.

    The only thing holding China together now is their economy. If it goes down tubes then China's government will morph yet once again.

  5. they have 5 thousand years of history and a common ethnic identity.

    but its okay, we have jews,they will save us:D
  6. They print Yuan to buy treasuries.
  7. China holds $725bln in treasuries & US bonds. Say they dump 50% in order to build roads and hospitals and such. That's $360bln or 10% of Chinese GDP. So far so good. Now how much of this is going to be offset by higher savings rates in North America and Europe punishing demand for Chinese exports?

    Western savings rates will go up across the board for a decade or two in order to come in line with historic averages; this has a recurring effect on demand for Chinese exports. Any Chinese stimulus however is a one-time effect.
  8. jlbonani


  9. jlbonani


    I like China very much I have been at the Great Walls twice. It really is something like a breathless scenario.

    I just want my money far from there.
  10. None of it will be "offset". It's like suggesting that taking away one of a teenagers many credit cards is going to transform them from a net-borrower into a net-saver.

    Yes, Chinese exports will get hit, but not because of magically appearing savings across the pond.
    #10     Mar 5, 2009