Is China already "kidnapped" by US?

Is China already "kidnapped" by US?
Oct 20, 2008 03:29
FRANKENSTEIN Points: Join Date: Nov 29, 2004 Status: offline	By the end of September, China has accumulated 1.91 trillion foreign reserves, of which 65 percent are US dollars, 25 percent Euros and other currencies such as Pound and Yen taking 10 percent. Currently, the whole world is experiencing a very serious financial crisis, which happened in US originally. Reading the statistics above, you will find that China has held a great deal of dollars. Due to the financial crisis in US, China will suffer huge losses in its foreign reserves. No matter China sells or keeps its dollar assets, its foreign reserves are starting to shrink. Apparently, China has been "kidnapped" by US. With a hold of almost 2 trillion dollars foreign reserves in hands, what should China do to keep it from damage?

Oct 20, 2008 03:29

FRANKENSTEIN
Points:
Join Date: Nov 29, 2004
Status: offline

By the end of September, China has accumulated 1.91 trillion foreign reserves, of which 65 percent are US dollars, 25 percent Euros and other currencies such as Pound and Yen taking 10 percent. Currently, the whole world is experiencing a very serious financial crisis, which happened in US originally. Reading the statistics above, you will find that China has held a great deal of dollars. Due to the financial crisis in US, China will suffer huge losses in its foreign reserves. No matter China sells or keeps its dollar assets, its foreign reserves are starting to shrink.

Apparently, China has been "kidnapped" by US. With a hold of almost 2 trillion dollars foreign reserves in hands, what should China do to keep it from damage?

Oct 20, 2008 18:16	#1
WCTMAN Points: Join Date: Dec 17, 2005 Status: Offline	Ironic, isn't it? The socialist Chinese paying for the capitalist American's decade long binge of spending, spending and more spending. Here we have one of the poorest countries in the world, per capita, lending money to the richest so that its citizens can buy homes they can't afford, SUV's they now can't afford to drive, and big screen TV's they now can't afford to watch.

Oct 20, 2008 19:52

MARRIE
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Join Date: Jan 7, 2008
Status: Offline

There is a joke on our political ideology: There is two ways to go ahead, one is socialism and the other capitalism. Out leader in a car asks the driver which way we have taken. The driver answers: it's capitalism road which is becoming wider and wider, brighter and brighter. Then the leader says:: Stay on the track and change to road name to Socialism.

WCTMAN, WalMart keeps the American families from brankrupcy. It's your choice and nobody forces you to buy Made in China.

I am wondering what the 2nd country following USA Stephen Harper is going to visit as soon as his second term begins. Liberals critisize him for his breaking up 50-years friendship between sino and canada. Now it's high time for Harper to change his strategy to activate economy.

Oct 20, 2008 20:43

ICEBERG
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Join Date: Sep 10, 2007
Status: Offline

With a hold of almost 2 trillion dollars foreign reserves in hands, what should China do to keep it from damage?

I don't know. China has tried to use its hudge amount of foreign reserves to invest in the US markets but it has proved that it was just a failure. Someone advises that China should sell out all its US dollar assets which takes 65 percent of its total foreign reserves in order to avoid great losses. This is not a good idea too. Selling out dollars might collapse US economy. You have known that the credit crisis in US has caused a serious global economic crisis. If US economy collapses, China will be impacted seriously too. So China won't sell dollars.

Marrie, actually I have noticed that many recent reports have similar views. Some of them suggest that the western countries should learn from the socialist country (probably China??) to fight the global financial crisis. As for the joke, it is ironic, isn't it?

Oct 20, 2008 21:00	#4
GRIZ326 Points: Join Date: Jun 12, 2006 Status: Offline	Kidnapped? No. China's just been caught in the game. However, unless a country actually defaults, the losses are only paper losses and will eventually return to the asset's former, relative value.

Oct 21, 2008 05:02	#5
WCTMAN Points: Join Date: Dec 17, 2005 Status: Offline	Marrie, no worries. I live in China, no need to shop at WalMart. And, I'm not American.

Oct 28, 2008 20:43	#6
DREAMLIFE Points: Join Date: Sep 5, 2007 Status: Offline	Who kidnapped who? If China doesn't want to suffer great losses, just sell its dollar assets in the foreign reserves. Then US will be deadly in trouble. However, China won't do this. The financial crisis has spread throughout the world. If China sells dollars, the US economy might collapse and other countries will be affected too. Horrible results!

Oct 28, 2008 22:30	#7
GARYKINKADE Points: Join Date: Jan 8, 2008 Status: Offline	China and the U.S. are now partners in a financial dance and they both need each other in order to finish to the music.

Oct 29, 2008 23:10	#8
COOLSPRINGS Points: Join Date: May 19, 2008 Status: Offline	You see Gary how Chinese love land by weighing more reserves on Fannie Mae and Freddie Mac. USD is appreciating and treasury bond is hot, which seems implying there is betting behine to avoid huge USD reserves devaluated. Yes, they are dancing although china doesn't say anything on bail-out.

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