Clinton Begs China To Buy More T-Bonds; Says 'we are going to rise or fall together'

Discussion in 'Economics' started by ByLoSellHi, Feb 22, 2009.

  1. Wow, does this make us look weak. Publicly panhandling on behalf of our reckless government - pathetic.

    Clinton Urges China to Keep Buying U.S. Treasury Securities
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    By Indira A.R. Lakshmanan

    Feb. 22 (Bloomberg) --
    Secretary of State Hillary Clinton urged China to continue buying U.S. Treasury bonds to help finance President Barack Obama’s stimulus plan, saying “we are truly going to rise or fall together.”

    “Our economies are so intertwined,” Clinton said in an interview today in Beijing with Shanghai-based Dragon Television. “It would not be in China’s interest” if the U.S. were unable to finance deficit spending to stimulate its stalled economy.

    The U.S. is the single largest buyer of the exports that drive growth in China, the world’s third-largest economy. China in turn invests surplus earnings from shipments of goods such as toys, clothing and steel primarily in Treasury securities, making it the world’s largest holder of U.S. government debt at the end of last year with $696.2 billion.

    China’s leaders understand that “the United States has to take some very drastic measures with the stimulus package, which means we have to incur debt,” Clinton said. The Chinese are “making a very smart decision by continuing to invest in Treasury bonds,” which she called a “safe investment,” because a speedy U.S. recovery will fuel China’s growth as well.

    China boosted purchases of U.S. debt by 46 percent last year to a record. The Chinese government said last week it plans to keep buying Treasuries, adding that future purchases will depend on the preservation of their value and the safety of the investment. China’s currency reserves of $1.95 trillion are about 29 percent of the world total.

    ‘No Viable Alternative’

    JPMorgan Chase & Co. predicted in a Feb. 6 report that China will keep buying Treasuries “not only for the near-term stability of the global financial system, but also because there is no viable and liquid alternative market in which to invest China’s massive and still growing reserves.”

    Chinese attempts to diversify from Treasuries into more risk-oriented assets have not fared well. It has lost at least half of the $10.5 billion it invested in New York-based Blackstone, Morgan Stanley and TPG Inc. since mid-2007.

    Asked by Dragon TV about the “Buy American” provision in the $787 billion stimulus package, Clinton downplayed worries that it would be a step toward protectionism, saying the provision “must be compliant with our international agreements.”

    “Protectionism is not in America’s interest,” she said.

    Clinton also said today that Treasury Secretary Timothy Geithner will co-chair an expanded bilateral dialogue on strategic and economic issues. The framework of that dialogue will be announced in April, when Obama and Chinese President Hu Jintao meet at the Group of 20 forum in London.

    Treasury, State

    Under the Bush administration, the U.S. and China held a Strategic Economic Dialogue run by the Treasury Department, without the assistance of the secretary of state.

    Clinton said the Obama administration felt that model was “very heavily dominated by economic concerns and by traditional Treasury priorities. They are very important, but that is not the only high-level dialogue that needs to occur.”

    Clinton was in China to meet with senior Chinese officials yesterday, including Hu, Premier Wen Jiabao and Foreign Minister Yang Jiechi.

    Today Clinton privately attended services at the Haidian Christian Church. She also met in the U.S. Embassy with 23 women activists in law, gender equality, poverty, AIDS and children’s rights, a continuation of similar gatherings she held when she visited China as first lady in the 1990s.

    Human Rights Groups

    She didn’t meet with any dissidents during her stay, and was criticized by overseas human rights groups for saying that U.S. concerns about restrictions on freedoms in China must not interfere with cooperation on financial crisis, global warming, negotiations about North Korean nuclear program and terrorism.

    China was the last leg of her first overseas trip as the top U.S. diplomat, which included stops in Japan, Indonesia and South Korea.

    “World events have given us a full and formidable agenda,” Clinton said yesterday at a Beijing press conference with Yang following a 90-minute meeting. “It is essential that the United States and China have a positive cooperative relationship.”

    Yang will visit the U.S. on March 9 for further discussions about the new strategic and economic dialogues.

    The Chinese government’s 4 trillion yuan ($585 billion) stimulus plan is an opportunity for global businesses to take part in the country’s infrastructure construction, Yang said.

    China’s Economy

    China, which surpassed Germany in 2007 as the world’s third- largest economy, is confident of meeting this year’s 8 percent growth target, an achievement Yang says is “China’s contribution to the world economic recovery.”

    Clinton and Chinese officials also discussed how to restart stalled talks, hosted in Beijing, aimed at getting North Korea to eliminate its nuclear weapons program.

    Clinton said she had raised the issue of human rights in her talks with Yang, calling those concerns “an essential component of our global foreign policy.”

    The U.S. State Department accuses China of political repression in Tibet and restrictions on worship throughout China. Groups including Amnesty International and Human Rights Watch said that Clinton shouldn’t set those concerns aside while talking with Chinese officials about other issues.

    Power Plant Visit

    After meeting Yang, Clinton and her special envoy for climate change, Todd Stern, visited the year-old Taiyanggong power plant, a gas-fired low-emission facility powered by General Electric Co. generators and turbines which provides heat for 1 million homes and buildings in Beijing, including the U.S. embassy. The tour was aimed at highlighting opportunities for the world’s two biggest emitters of greenhouse gases to cooperate on clean energy.

    Clinton noted that China, with its rapid industrial development, has surpassed the U.S. as the largest source of carbon emissions and said collaboration on green energy would offer a business opportunity.

    “The international financial crisis is having a big impact on the entire world,” Wen told Clinton at their meeting. “I very much appreciate your comment that people should work together like passengers in a boat.”

    At an earlier meeting, State Councilor Dai Bingguo told Clinton that she looked “younger and more beautiful” than she appears on television.

    “Well, we will get along very well,” Clinton laughed.

    ]i]To contact the reporters on this story: Indira Lakshmanan in Beijing at[/i]
  2. Yip. This request really goes to show just how bad things are when the mighty U S of A has to beg China to buy our debt (aka lend to us).
  3. And nothing less than a very public and degrading act of begging, to add insult to injury.

    You'd think she'd have enough brains to beg privately.
  4. JamesJ


    why not buying some gold... or more interest in mining companies around the world..
  5. We have abused the world with our non-stop deficits. Had the $USD not been the reserve currency, we'd have had our feet held to the fire long ago.

    Our Gummint and Fed have painted us into a corner so that we really NEED China to play ball with us now. I'm not so sure China needs us as badly..
  6. This is why I keep saying...reduce consumption NOW!

    And do NOT consume much even if economy "recovers" because you're no longer helping US economy by consuming all kinds of imported crap, you're helping US get into more debt.

    The problem here is that it *cannot* be a government mandate to stop buying imported shit.

    It has to be a "grass roots" kind of thing where people take it upon themselves to consume less imported stuff.

    Relying on the Chinese to reciprocate with "free trade" is what the US today has to show for it...NOTHING! Only more debt because the other smaller economies always manage to export their way out and save their skin while US gets deeper & deeper in the hole.
  7. The Chinese population & economy are used to hardships. They'll survive even in a depression.

    If the US has a depression today, millions would probably starve.
    Then again, there's so much stored fat in the avg american, maybe it might actually be a benefit in such a situation.

  8. Hey, it takes a lot of balls to go begging to the Chinese.

    And no one can say that Hillary does not have balls.

    The only person that came to Washington with more balls than Hillary after Obama's victory was Barry's lovely and charming wife Michelle.
  9. Let's make it simple....

    Mr. China....Mr. Geithner did not mean what he said....

    He takes it back....

    He really did not mean to call you "a money manipulator"....

    And by the way....we know you do not like it....but if you don't....

    Your case will just get far worse....

    You do know that you not ?

    You do know what US monetization of several $Trillion will mean to you ?

    And if you have not noticed,

    I am not from the treasury department .....
  10. trendy


    Because buying gold or mines is not going to put the Chinese people to work. Selling shit to us keeps them employed. Your argument makes sense from an investment standpoint, but there is obviously much more to it from a governmental perspective.
    #10     Feb 22, 2009