China and the U.S. Dollar

We have pointed out over the past years that China has been a huge buyer of U.S. bonds. This has been a relationship of mutual rewards over the past decade....we buy their stuff which they make for cheap....they borrow us more money to buy more of their stuff.

As we have pointed out....buying stuff is what makes the world go 'round.

As of late, this relationship has gotten a tad concerning. China now owns over $1 Trillion of our debt. The bible tells us that the borrower will become slave to the lender, so that is concerning for the U.S. But on the other hand, China now needs the U.S. to keep the value of the U.S. dollar at a worthwhile rate....otherwise they could see it all go up in smoke. And with their economy in dire straits....they need us to pay them pack in dollars that are worth something.

Mr. Wen voiced concern on March 13 about China’s dependence on the United States: “We have lent a huge amount of money to the U.S. Of course we are concerned about the safety of our assets. To be honest, I am definitely a little worried.”

The main worry of Chinese officials has been that American efforts to fight the current economic downturn will result in inflation and erode the value of American bonds, Chinese economists said in interviews in Beijing on Thursday and Friday.

Read full article here; http://www.nytimes.com/2009/04/13/business/global/13yuan.html?_r=3&ref=global-home

Finally, I will remind you that China has a huge amount of assets on the west coast of the U.S. At the rapture of the church, the U.S. will collapse in every sense of the word. Make no doubt....the Chinese government, who is just rolling out a brand new navy, will swoop in on California just as fast as they can send troops. They will do this to lay claim to the assets that are theirs. And who would be there to stop them??