China Financial News

[Gale Hawkins]

Asia Times Online :: Beijing caught in debt dilemma

This article raised several concerns in my mind.

If this many firms are actually failing in China will this affect farm equipment exports in any manner?

If China as a large source of cheap loans was to dry up what could that do to our interest rates?

Many in China have only see success in many years so how will they deal with any sharp/long financial reversals?

 

[creekbend]

Due to cheap labor in the past, many upstart new Companies raked in vast profits. I saw a documentary about China that reviewed entrepreneurs that were driving around in Bentleys and other expensive autos. But within the last several years, the working class have developed into a form of middle class. Higher wages, better working conditions and other demands have resulted in less profits for these new Companies. Rest assured that the financial stability of the governing party of Red China's government will fare better. If worse comes to worse, all Red China has to do is cash in their Treasury notes. I remember reading in Newsweek around 8 years ago that if Red China decided to cash in all their T-Bills at one time, the government of the United States of America would be forced to react in one or more of these ways. 1- declare bankruptcy, 2- declare that the current currency is defunct and insolvent, and 3- print a new form of currency thus establishing an entire different Treasury and Financial system. 8 years ago was when our last grandson was born. Just my opinion, it is not my intention to stir up a hornet's nest, but the Thread opened the inevitable door to this possibility. There are bound to be additional posts, some positive and some negative. We live in a Global economy now and problems in one region usually affects other Countries economies.:tractor:

 

[YanmarFever]

Creekbend,

When one borrows, he is a slave to the owner of the debt.

The US. is in deep do do, its a good time to get out of debt before tshtf.:thumbsup:

 

[creekbend]

Creekbend,

When one borrows, he is a slave to the owner of the debt.

The us is in deep do do, its a good time to get out of debt before tshtf.:thumbsup:

I agree 100%. The current National debt has increased dramatically in recent years. One only has to review the available data in regards to the last several years' acquired debt. We have lost a large amount of our once dominant diplomatic clout, largely because of our increasing trade deficit with Countries such as Red China. Just my opinion. It may not be seen as being politically correct, but I will always refer to the Country of China, as RED CHINA. There is an old adage that goes somewhat like this: Those that forget history tend to repeat history. I sincerely wish that everyone has a good night.

 

[ultrarunner]

Due to cheap labor in the past, many upstart new Companies raked in vast profits. I saw a documentary about China that reviewed entrepreneurs that were driving around in Bentleys and other expensive autos. But within the last several years, the working class have developed into a form of middle class. Higher wages, better working conditions and other demands have resulted in less profits for these new Companies. Rest assured that the financial stability of the governing party of Red China's government will fare better. If worse comes to worse, all Red China has to do is cash in their Treasury notes. I remember reading in Newsweek around 8 years ago that if Red China decided to cash in all their T-Bills at one time, the government of the United States of America would be forced to react in one or more of these ways. 1- declare bankruptcy, 2- declare that the current currency is defunct and insolvent, and 3- print a new form of currency thus establishing an entire different Treasury and Financial system. 8 years ago was when our last grandson was born. Just my opinion, it is not my intention to stir up a hornet's nest, but the Thread opened the inevitable door to this possibility. There are bound to be additional posts, some positive and some negative. We live in a Global economy now and problems in one region usually affects other Countries economies.:tractor:

How could China even "Decide to Cash In T Bills"

Are not all T Bills fixed for a specific time... some 30 years out?

 

[Gale Hawkins]

How could China even "Decide to Cash In T Bills"

Are not all T Bills fixed for a specific time... some 30 years out?

Money Market: Treasury Bills (T-Bills)

 

[EMB5530]

Money Market: Treasury Bills (T-Bills)

Thanks for the link to the Info:thumbsup:

Im an investor now hehehe:laughing:

 

[dmccarty]

Creekbend,

When one borrows, he is a slave to the owner of the debt.

The us is in deep do do, its a good time to get out of debt before tshtf.:thumbsup:

This s only mostly true.

One is a slave to the debt if you give a rat's behind about said debt. How many people are walking away from upside down mortgages even though they can pay the monthly bill? We have had TBNers state they are walking away from house loans though they can pay the mortgage.

The borrower does not have much to fear if the debt owner cannot reclaim the loan.

If China cashed in T Bills or played some other financial game there would be great pain in their country. The Chinese have for thousands of years put great focus on stability. They very much fear revolts and revolutions and for good reason. If the US stopped buying goods made in China they would be hurt very badly. So would we. But they would have very large unemployment more so than they have today. There have been thousands of protests in China over the last few years which is amazing given they are a totalitarian system. These protests have been growing in size and number as the Chinese people get fed up with the government theft and corruption. The CCP is going to have to be very careful on how they respond to internal and external events to stay in power. Playing games that would hurt the US financially would also hurt China and the CCP.

They might have a loaded gun but it is aimed at both the US and the CCP. My two cents is that the gun is more apt to hurt the CCP much more than the US if it is fired.

One has to question the financial health of China in general. There have been numerous articles in the WSJ over the years regarding the health of Chinese banks, loans, businesses, stock markets, real estate markets, etc. The US has money problems but so does the CCP.

According to the US Treasury, China holds 1.1 trillion dollars of US debt out of a total of 4.6 trillion. http://www.treasury.gov/resource-center/data-chart-center/tic/Documents/mfh.txt. Tis quite a bit of debt but the US GDP is 15 trillion dollars We would be in better shape if the US government did not owe almost 15 trillion.

There is a fourth way to pay of the debt which is to cheapen the value of the dollar.

Later,
Dan

 

[Gale Hawkins]

Dan I agree with your thoughts on China. The best we can hope for is a stability at the top over there. The Genie is out of the bottle because many have tasted at better life and expect it to never end.

The one plus we have in this country is the ability to let off a little steam when selecting new leaders but that is not the case as much in China.

I think there are both good and bad things developing in China and we can only hope the good carries the most weight.

 

[creekbend]

Money Market: Treasury Bills (T-Bills)

Thanks for providing that link to ultrarunner and others. It's not the fact that they may or may not make that decision. The fact remains that China holds a major financial strangle hold on this Country. Plus our total National Debt must be reduced as soon as possible. It has increased around 4 trillion in the last several years. China is currently drilling for oil off Cuba, investing in mineral exploration in Australia, and is getting a firm foothold in Africa--plus others. The largest military landforce on the globe, rapidly increasing naval forces, are also a concern. Just my thoughts. I hope everyone has a good day.