Chinamerica goes on vacation

Discussion in 'China' started by amitkriit, Aug 7, 2011.

  1. amitkriit

    amitkriit Senior Member Senior Member

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    The recent weeks’ tense moments over an American default passed India by. This only shows how little India counts as a globalized economy, how shallow are our self-conceptions as an "emerging power" whose views are listened to with rapt attention in the G-20.

    The government didn’t bother to waste its breath on the US default when almost all major players (China, Russia) were beside themselves with excitement - and most minor players, too — be it a trading nation like Turkey or the Persian Gulf oil exporters who trade in dollars.

    What caught the attention was of course China’s reaction. It kept its thoughts to itself until it was fairly certain that the coast was clear and its dollar reserves are remaining intact. Now, flood-gates are opened. Discussions are galore. Of course, they are exhilarating and they throw much light on the intellectual climate in China. The government newspaper China Daily featured an analysis by an American specialist. Main points: A) China’s voice doesn’t count in the US policy-making, as US is an ‘incredibly insular country’ that ultimately knows and would decide on the basis of what is good for itself. B) China’s opinions are either ignored or will be resented. C) The mood in the US is ‘anti-China’ and, defaulting on China debt might even enjoy ‘considerable popularity’. D) If the US hasn’t done that, it is because first, the budget deficit is primarily due to US healthcare system and not really a matter of excessive spending or tax-cutting, and, secondly, US’ borrowings from China stem from its trade deficit rather than budget deficit. “The trade deficit is what gives China the dollars to buy US assets of all types, including US government bonds.”

    So, what is the moral for China’s ‘policymakers’? Put simply, ‘Don’t think you are such big shots as to fancy you wield any clout over the US’s economic policy making’. Hello, ever heard of ‘Chinamerica’?

    Chinamerica goes on vacation - Indian Punchline
     
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  3. kickok1975

    kickok1975 Stars and Ambassadors Stars and Ambassadors

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    China is losing money. But US is losing its credibility, dignity and fundamentals of how this country has risen to the top. Who is bigger loser?
     
  4. thakur_ritesh

    thakur_ritesh Administrator Administrator

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    do you think china has "credibility, dignity and fundamentals" in the indian eyes?

    and if in indian eyes there is none, then does it make any difference to the chinese?

    lets move on, in the real geopolitic world words like "credibility, dignity and fundamentals" have no meaning.
     
  5. asianobserve

    asianobserve Elite Member Elite Member

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    If asked to choose between the US and China, Indians would troop to the former anytime of the day. Nice try...
     
    utubekhiladi likes this.
  6. amoy

    amoy Senior Member Senior Member

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    Who're top holders of U.S. Treasury securities? Not China for sure

     
  7. Daredevil

    Daredevil On Vacation! Administrator

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    Most of them are domestic holders and they will not be affected as much as external debt holders like China. China will at least take a hit of 200 billion dollars to the devaluing of US dollar in the near future. Any attempt by China to sell the treasury bonds will further devalue US dollar affecting the Chinese bottom line by 10% at least. China is trapped between hard place and rock. China has to shut their trap and bear the pain.
     

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