everything in that OP is garbage. watch what china does, not what they say. they buy bonds because their investing brains is the only think they know how to do. They have tried stocks, and their asses were handed to them. Even if interest on bonds is zero, they will buy bonds. why? Because if they put cash in a bank, the bank may disappear with their cash. Therefore China does put money in US debt because they have no other choice. And it is NOT to fund us cusumers. That is just bullcrap. Article posted is typical of how a mouth piece of the china government speaks. If what they say is the truth, why do not they sell? I am sure they are buying even more and asking their managers why they did not buy more, and slapping them on the face. Chinese lack imagination and are idiots. China will always be a non-leading nation (except in number of people).
"Chinese lack imagination and are idiots. China will always be a non-leading nation (except in number of people). " u must live in a country whose currency has been falling for the last few years whose stock market hasn't gone up in ten years whose country is nothing but a paper tiger militarily. they cannot stop the piracy off sudan and the gulf of aden or pacify a couple of 3rd rate countries,whose investment banking industry has disappeared and whose people are stopping to pay their mortgages so they can qualify for gov't handouts etc.
Stop this BS. Free trade benefits both sides and my hats to any government that can feed 1.3 bill people and keep them off the streets. Do you prefer that Asia be like Africa?! And why do we care about government debt? We are private self-sufficient traders. We can be in Honk Kong, Singapore, London etc... who gives a fuck.
1. I have no problem with Europe. 2. I've lived in various places of Europe for a little over 5 years. 3. While trichet is consistant with himself, there are others at the ECB and politicians in the EU who are not consistant with him, and themselves. Which is what I was referring to. Any more comments?
Countries like China and Japan have high savings rates. They buy USD t-bills to diversify their investments. the USD is like gold to foreign investors. Interest rates in USD or bonds are same as in Japan and China but US tend to have higher interest rates in the long term.
we clearly have very different opinions. commodity bubble was fueled by fed's easy money policy. everybody was escaping to commodities to hedge against the perceived risk of inflation it brings (especially in the first half of 2008). ultimately it only made the fall from highs harder than it would otherwise been and we are where we are. thanks god for ecb's balls. i never had much sympathy for (equity) cheerleaders of your kind for super loose monetary policy. after all that's the major reason we are so fucked up. nobody saves and who would at ~0% rates. and here we are again - one of the reasons americans are so indebted...