Thursday, January 08, 2009

China Losing Taste for US Bonds

China, which has largely been subsidizing the US spending spree, is increasingly losing its appetite for buying US treasuries. Obama's recent statements warning of several years of annual trillion-dollar budget deficits for the upcoming future, certainly didn't help things. Asian countries had better figure out how to come up with alternative markets, otherwise they're going to be increasingly dragged down by being shackled to a sinking US.

1 comment:

sansk said...

This won't be good for China either becuase China is addicted to export income that comes from selling to US. A US unable to buy Chinease stuff is surefire recipe for social and economic chaos in China.

Ironically, China is not alone in this respect. Many countries are dependent on American consumer for their own economic growth.