| Will China help US out of financial crisis? | |
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| Oct 10, 2008 01:45 |   |
 | A source said that China would take out 200 billion to bail US out of the financial crisis. But China finally cleared that it never said this. Now Ken Rogoff of Harvard made another suggestion---"China could offer to lend up to $500bn (from its current stock of $1,800bn) to the US government for the rescue of its financial sector." According to him, China won't help US out unconditionally. There must be some conditions attached. Some people think China will give a hand to US. First, the financial crisis will be over and global liquidity problem will be avoided too. Second, if China helps US out of crisis, it can gain some economic interests. US economy will get out of recession. So China's export can be protected. Do you think China will offer 500 billion to help US out of crisis? |
| Oct 10, 2008 14:34 | #1 |
| No the probability for this to happen is extremely small and useless. Injecting billions in the market system is a pure nonsense today. The market is governed by confidence as you already know. And there has been more than ten times the amount you are talking about invested in pure loss. Market actors have lost confidence, it is a selling spiral that will only stop once the market has been rebooted. To be clearer, a few years ago the financial world has completely lost every single link with the real economic activity and so with every national laws. It was making money by and for itself. Today is just a readjustment of the market to the real world. So it will probably go down until the real economic level of the world and then stabilize. Most probably this crisis will end in about a year but only if there is a worldwide answer to the crisis. The main interest of such a crisis will be to build a new organization charged with ensuring that the market respects some global rules. We should see this event as a chance to reset the financial system of the world. But this relies on world governance... |
| Oct 10, 2008 15:33 | #2 |
| It is a worldwide thing; the Asian markets are volatile as well. I don’t think we need to ask for help from China. China has to take care of home, perhaps that’s the best help China can offer to the rest of the world. A very strong Chinese economy will make this world economic recession shorter and less painful to affected world economies. People living in third world countries are certainly more affected; it is a trickle down thing. |
| Oct 10, 2008 15:44 | #3 |
| You are right, we are complaining because we are loosing money but in many countries the food shortage hasn't stopped for the entire year (even more in some countries, especially in Africa). Their life is at stake. |
| Oct 10, 2008 22:22 | #4 |
| China is helping herself if she injects cash in US T-notes considering she is one of the bigest five investors in Freddie mac and fannie mae. |
| Oct 11, 2008 21:10 | #5 |
| I am with JC. First, China needs to take care of its domestic market. This year, Chinese stock market performs worse and worse compared with its peak time. If it can't take care of itself, it is impossible to help others. |
| Nov 28, 2008 02:01 | #6 |
| GUEST28160 | I'm chinese .I think our goverment will help us .because this is things all over the world. |
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