Asia Stops Buying U.S. Debt - Political Forum

Wheeldog · 05-01-2008, 03:27 AM

http://www.politicsforumpoliticalwor...newthread&f=18

Quote:

......Japan owns more Treasuries than any other nation. .....

America relies on foreign investors, who own more than half the U.S. government debt outstanding, to finance a deficit.......

Diminishing Returns
.......
European Debt

``European debt is more attractive than Treasuries,'' said Nobuto Yamazaki, executive fund manager at Diam Asset Management in Tokyo, .....
The cost of wheat and crude oil has almost doubled in less than 12 months, helping push the annual inflation rate to 4 percent in March from 2.8 percent a year earlier.
......
Asian investors outside Japan are also pulling back. Money managers in China, the second-biggest overseas holder of Treasuries, with $486.9 billion, and South Korea say they favor debt in Europe, equities or commodities.

Beijing-based ICBC Credit Suisse Asset Management Co., controlled by China's biggest bank, said last week Treasuries are ``not attractive'' because of currency risks. ......

U.S. borrowing costs will rise in the ``longer term'' because central banks may slowly cut their holdings of dollars to about 30 percent of their reserves in 15 years, from less than 60 percent now, said Kenneth Rogoff, a former chief economist at the International Monetary Fund in Washington.

``The dollar's primacy in the international financial system is being eroded,'' said Rogoff, a professor at Harvard University in Cambridge, Massachusetts. ``Foreign investors have done very poorly in U.S. Treasuries.''
....
``I wouldn't jump into U.S. Treasuries,'' said Hao Kang, who manages a $443 million fund at ICBC Credit Suisse in Beijing. ``I am not so confident about the currency.''

The U.S. relies on Japan, China and other nations to buy our debt (lend us money). Based on the above article, our creditors have finally had enough. This will have major impacts on the U.S. economy. Even worse, it could encourage OPEC to stop pricing oil in dollars. Our house of cards is beginning to shake.

Izzibeth · 05-01-2008, 08:06 AM

Well, we certainly are getting our wake-up call, aren't we?

I'd like to give a big "THANK YOU!" shout out to my parents' generation and my grandparents' generations (the ones who voted in the current administration) for ensuring that my adult years are going to be as painful and full of struggle as possible. *thumbs up*

discoman · 05-01-2008, 11:48 AM

Quote:

Originally Posted by Wheeldog

http://www.politicsforumpoliticalwor...newthread&f=18

The U.S. relies on Japan, China and other nations to buy our debt (lend us money). Based on the above article, our creditors have finally had enough. This will have major impacts on the U.S. economy. Even worse, it could encourage OPEC to stop pricing oil in dollars. Our house of cards is beginning to shake.

Well what do you expect wheeldog, America continues a reverse economic policy of Tax cuts, and increased Government spending.More government funds are being spent, and the Government deceids unilaterally to cut its Tax
intake for revenue.How do you think that backward policy looks to the rest of the World?.If I were an Asian country I would stop buying U.S. Govnmt.debt instruments also.Because they see this backward policy of Tax cuts,increased Gov spending.They see a country heading for a Economic crisis
and one that may not be able to repay them for their investments.The Federal government must raise Taxes now and decrease the Federal deficeit
now,inorder to restore confidence in their Government securities.

Shiva_TD · 05-01-2008, 02:45 PM

Unfortunately none of the major remaining presidential candidates (McCain, Obama, or Clinton) has addressed paying off the national debt and in fact they have all historically supported increasing it.

The only presidential candidate that addressed paying off the national debt and opposed increases to it in congress was Ron Paul.

discoman · 05-01-2008, 04:56 PM

Quote:

Originally Posted by Shiva_TD

Unfortunately none of the major remaining presidential candidates (McCain, Obama, or Clinton) has addressed paying off the national debt and in fact they have all historically supported increasing it.

The only presidential candidate that addressed paying off the national debt and opposed increases to it in congress was Ron Paul.

This is exactly my point.Out of 15 candidates for the office of President of the United States, only one had a plan to reduce the national debt.What kind of impression will that give many of these foreign countries when they try to deceide weather they shoudl invest in American government securities.?

Pander · 05-04-2008, 11:18 PM

Well, trying to be optimistic here, i would have to say that hopefully this will cause the national debt problem to become more known unto the average American. Thereby causing it to be dealt with, because things only get done when most of the American citizens want it accomplished. If we can't finance our country then the American people will care, because when they're not receiveing their SS check, or their Medicare insurance, or their stimulus check ... lol talk about a slap in the face.

Shaynj · 06-09-2008, 02:33 PM

Quote:

Originally Posted by Izzibeth

Well, we certainly are getting our wake-up call, aren't we?

I'd like to give a big "THANK YOU!" shout out to my parents' generation and my grandparents' generations (the ones who voted in the current administration) for ensuring that my adult years are going to be as painful and full of struggle as possible. *thumbs up*

I do agree, selfish basterds

Shaynj · 06-09-2008, 02:42 PM

China will keep buying our debt, someday they will end up being the world power and they have the cultural patients to pull it off and we are selling it to them with a smile saying thank you for selling us cheap junk at wal-mart

smallpox · 06-09-2008, 07:26 PM

Here's a GREAT idea to fix the problem........................................... ...............................................sto p borrowing money!!!! Oh course the Bush Administration has put the country into a debt hellhole it can't get out of, at least for now.