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Tue 7 Aug, 2007 02:12 pm
Quote:China threatens 'nuclear option' of dollar sales
The Chinese government has begun a concerted campaign of economic threats against the United States, hinting that it may liquidate its vast holding of US treasuries if Washington imposes trade sanctions to force a yuan revaluation.
Two officials at leading Communist Party bodies have given interviews in recent days warning - for the first time - that Beijing may use its $1.33 trillion (£658bn) of foreign reserves as a political weapon to counter pressure from the US Congress. Shifts in Chinese policy are often announced through key think tanks and academies.
Described as China's "nuclear option" in the state media, such action could trigger a dollar crash at a time when the US currency is already breaking down through historic support levels.
The Chinese are going to stab us in the back. if we don't turn away from Iraq and Afghanistan to rebuild/recover our strength. Where they're financially and militarily, bleeding us to death.
Fine, threaten to sell Aegis equipped ships to Taiwan if they do so.
If China were to do that, they would be cutting their own throats.
The LAST thing that China wants is a weak dollar because that would completely wipe out any chance of a trade surplus from their number one trading partner... the U.S.
A weak dollar means lots and lots of closed down factories in China because the Americans can't afford their widgets and doohickies.
They will threaten, they will try to influence, but they won't 'drop the bomb' unless they have a guarantee of some other country willing to buy several hundred billion dollars worth of junk a year.
Fedral wrote:If China were to do that, they would be cutting their own throats.
The LAST thing that China wants is a weak dollar because that would completely wipe out any chance of a trade surplus from their number one trading partner... the U.S.
A weak dollar means lots and lots of closed down factories in China because the Americans can't afford their widgets and doohickies.
They will threaten, they will try to influence, but they won't 'drop the bomb' unless they have a guarantee of some other country willing to buy several hundred billion dollars worth of junk a year.
And here I thought you'd abandoned A2K...
Cycloptichorn
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