Dear USA

Pay back all loans immediately.

Your creditor,
People's Republic of China

If you owe the bank a million dollars and can't pay, you are in trouble.

If you owe the bank a billion dollars and can't pay, the bank is in trouble.

There isn't a damn thing yhe PRC ca do with respect to using the dollar denominated securities it already holds as a means of influencing US policy.

Try to cash them in all at once, or on any accellerated schedule, and China kills its own manufacturing sector and causes massive additional domestic unemployment, destabilizing the already very fragile domestic economic system and political control by the party outside Bejing.

Yeah, we have the Chinese right where we want them.

Like there is no other place for the Chinese to "reinvest" those funds currently invested in US securities?

Are you living in some kind of vacuum, nony?

Piss China off, they move their "investments" from dollars to euros.

They encourage their friends in the Islamic world to change their valuation of oil sales from US dollars to Euros.

*Shazam*...US suddenly financial hegemon has-been.

Same could be done with Saudi funds. Which is why the US is propping up one of the most despicable despotic regimes on the face of the planet. You should hope the revolutionary wackjobs in Saudi Arabia don't bring down the royal family...or the Wahabists don't abandon them for their whoring after western materialism.

You should hope that Saudi Arabia and Iran never see eye to eye. Iran has already started the process to value its oil reserves and sales in euros.

As much as I despise Bush and hate to admit it, at least he got this one right. Finally.

Y'know, the Dalai Lama visited Portland, spoke from the dais above the waterfall, read everyone's mind, some read his mind back, consecrated Portland's 'living room.'

Which fairly well stopped that anachronistic, teutonic travesty of a misappropriation idea, Stickel's Currier & Ives-ancian 'krystal sternicht' ice-skating rink there. Blessings. Blessed event.

Who's George Bush?

You know, my Mom worked with Tibetan refugees back in Texas, and I heard a lot of stories about just what the brutal Communist Chinese scumbags did to that country. Bulldozing countless, ancient temples, shackling old monks up by their hands in basements and beating them to death for refusing to give up their religion, as they urinated on themselves in abject terror, the list is quite long.

Screw You, China.

Just for that alone, should they ever foolishly decide to invade the US and seize some land, I will be behind one of those blades of grass Admiral Yamamoto spoke of. There are worse things than death, and the truly horrific crimes the Commies perpetrated upon the peaceful peoples of Tibet are some of them.

So now standing up to a communist, dictatorial regime is a BAD thing?

T'aint the funds themselves, Godfrey.

Its the Chinese industrial production.

Trash the US economy and you trash the Chinese exports market. And neither Saudi Arabia, nor Iran, nor Europe will soak up those exports.

And the resultant Chinese un employment will take down what is already a very shaky Chinese government.

While neither CNN nor the Times are covering it, there is massive and violent labor unrest throughout the PRC, with CCP cadres routinely being lynched at factories in the provinces, and local PLA units are
increasingly munitying rather than firing on local workers.

My brother was the Reuters video guy in China during the hand-over of Hong Kong era. He told me about visiting some industrial operation, so dirty the cars went through a sprayer on the way out. One of the reporters made a crack about going through the brainwash. I'm not a big fan of police states and I've had two jokes on internationally about China. The first featured their leader's face on a bottle of cologne called, "Oppression". The second was about next year's Olympics: "You can tell China is a police state. One of the new Olympic events will be synchronized thinking."
These economic arguments strike me as another kind of thinking, though: Wishful. It's not what we owe China now, it's that we are relying on them to keep on lending us money. That's what worries me. I'd prefer having our economic future in our hands, rather than hoping for the right set of circumstances internationally to protect our financial well-being. Plus, if resources like oil ever become scarce enough, China could just shutdown the country that uses 25% of the world's recourses: Us. That's a vulnerability.
I also remember thinking that maybe getting Hong Kong back would be a classic case of the Chinese proverb "be careful what you wish for." Maybe China wouldn't swallow Hong Kong. Maybe Hong Kong would swallow China. One thing is for sure: Police states suck. Let's avoid one here.

So now standing up to a communist, dictatorial regime is a BAD thing?

No, its most likely the backing of a religious figure that has hackles up.

What? You think that Tibet should be returned to the native peoples...or sumpin'?

And, why aren't those people doing something about Turkestan? It's enslaved in China, too. I guess it pays to have a friendly fuzzy camelid whose eyes close when he tilts his head back. Beau coup public relations for that...it helps cover up that violent history (within the various Tibetan Buddhist sectaries and against the Chinese).

Okay, so...when are you and your family going back to some other continent than North America?

Move those investments from dollars to euros, Godfrey? Sure, just click your heels! China holds over $500 billion in long-term US bonds. The key word here is long-term; which means that China would have to find a buyer. Who else has $500B sitting around? No one. So you sell $100B and what happens? The value of your remaining $400B pluments, the dollar drops faster than you can say goodbye, the US economy tanks, China's industrial production comes to equally quick end, the entire world ends up in a massive depression that will make the 1930s look like good times. China knows all of this; they are not stupid.

What China needs to do is let its currency float (it is now artifically tied to the dollar). The value of the luan rises, Chinese exports cost more, US consumers buy less, China's industrial production slows from the current 10-15% rate to a more manageable level, the US slows its comsumption of consumer goods therefore less need to borrow from China and Japan (which also hold a massive amount of US debt).