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alstry (35.99)

Chinese LOVE Their US Debt

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March 08, 2010 – Comments (10)

Some of you Fools have the misguided belief that the Chinese might be concerned about their treasury holdings.  Such a perspective would be the furthest point from current reality.

The Chinese have approximately $2 Trillion dollars of US debt.  That debt is very liquid and convertible to US dollars practically upon demand.

Whatever happens to the dollar, the one place US dollars will always spend is in the US of A.  And right now the Chinese are BIG BUYERS of US assets.  Assets like office buildings, shopping malls, homes, beach houses, corporate stock etc......

Although $2 trillion is a lot my most standards.....it is not even a fraction of the value of the assets the Chinese can buy with their US debt holding.

So if you think the Chinese are worried......ask yourself why are the smiling each time they buy a farm?????  You think they are worried they may not get value for their bonds.....the more the US implodes, the greater the value they receive.

Welcome to reality my fellow Fools.....hope you can speak Chinese......one who does may be your next boss.

10 Comments – Post Your Own

#1) On March 08, 2010 at 4:32 PM, alstry (35.99) wrote:

It even gets crazier....with Wall Street cutting off the American citizens from credit.....the value of American assets are crashing....FAST AND HARD.....

$2 trillion goes a lot further today than it did just a few years ago.....and expect it to go even further in just a few months.

You better be nice next time you go into a Chinese owned restaurant....with a little loan from their government, they may own your entire town soon.

You think a back door deal was cut between Wall Street and China??  Why do you think so many Chinese IPOs are underwritten by Wall Street Banks.

If Wall Street is willing to outsource an American factory for efficiency even if it destroys a town....don't you think they would outsource America for profits???

Now you are finally learning my little Fools.  You are being sold out by the same jokers you just bailed out.....and they control your "elected" officials, especially as the tax receipts evaporate.

Again...you will understand soon.

You KNEW by 9.09

You FELT by 11.10.9

Not it is happening after 1.01.10

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#2) On March 08, 2010 at 4:41 PM, TheClub55 (21.97) wrote:

What makes you think property is a "safer" investment than the bonds?  If the government ever thinks china is a risk, they can just “steal” the land / industry back in the name of national security (it happens all the time)… almost as easy as it could default on the bonds owned by china.   

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#3) On March 08, 2010 at 4:43 PM, alstry (35.99) wrote:

GET READY FOR ASSET VALUES TO COLLAPSE!!!!!!!!!!!!!!!!!!!!!!!!!

State Tax Revenues Plummet By $87 Billion, Biggest Year Over Year Decline In History; Record State Tax Hikes In Progress

The higher the taxes, the lower the asset value.....and taxes are likely to to waaaaay up as tax receipts evaporate.

You gotta luv Wall Street's game....the Zombulation of our nation.

America going on sale....just not to most Americans.

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#4) On March 08, 2010 at 4:45 PM, alstry (35.99) wrote:

TheClub, 

Because a property that grows corn on it can produce something that can be exported back and feed their people.....and Warren Buffett can ship it to them  on his new railroad....while our people go hungry.

Are you seeing how this is playing out as Mr. Buffett makes money on derivitives????

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#5) On March 08, 2010 at 6:09 PM, alstry (35.99) wrote:

HOW MUCH CRAP IS GOING INTO RETIREMENT ACCOUNTS????

Failed Banks May Get Pension-Fund Backing as FDIC Seeks Cash

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#6) On March 09, 2010 at 9:22 AM, TheClub55 (21.97) wrote:

Alstry... I do realize China could grow corn and ship it back to China, but our gov could "steal" the land back at any time to feed our own people (national security) nearly as easily as defaulting on a bond.  In fact if we were to "beat the war drum" on China (and you talk about war all the time) we could specific default on an China owned bonds and keep others whole in the name of national security as well. 

As other have pointed out we are loosing the rule of law in our own country, ask GM bond holders - so why is difficut to believe that we won't seal from China?  

Ask the big oil comanies how some forgien investments work out, their investment have been "stolen" countless times in the name of national security.  Its more likely Chica will purchase hard good that can be stored w/in their boarders. 

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#7) On March 09, 2010 at 10:15 AM, SkinneeJ (28.12) wrote:

If the government started "stealing" land back from China, that would be the start of WW3.  I don't think that the USA would be in a position to do something like that, especially if we were so hard up for cash that we had to!

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#8) On March 09, 2010 at 10:24 AM, XMFSinchiruna (26.96) wrote:

Slight correction: China has nowhere near $2 trillion in US debt. Their full forex reserves are around that sum, but the US portion of that debt was below $800B last I checked.

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#9) On March 09, 2010 at 1:56 PM, TheClub55 (21.97) wrote:

SkinneeJ - I was just trying to show that buying land is no better than holding bonds... in the extream circumstances that alstry likes to highlight.  As for war w/ China it will be econimic at best (which is a good thing b/c shooting is very bad), we're not landing troops on their shores and they are not landing on ours.  Both sides have nukes and large armys...

 

 

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#10) On March 15, 2010 at 1:50 PM, alstry (35.99) wrote:

Sinchee,

I added in the agency debt with the current implied guarantee plus other denominated assets....

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