Booh! said:
Kasz216 said:
Booh! said:
Lostplanet22 said:
Booh! said:
Lostplanet22 said:
And ten years ago it was 1/10th of the GDP of Italy....And?
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It won't last, like it didn't last for Ireland and Spain.
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Yes agree, if they have to beg in Beijing for money Italy will not last long anymore.
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Why not? USA begged China for years now, Italy can do the same.
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The US didn't beg anyone. China buysUS debt because unlike Italy... Chinese Debt is worth something.
It's basically the only economy and currency big enough to act as a decent reserve for the Chinese government to store their money.
I mean the Euro? No chance, not while every Eurostate has it's own independent fiscal policy.
Not to mention that the Chinese tie their currency to the Dollar, meaning in dollars they are far less vulerable to exchange rate changes then they would be the Euro.
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That's what you think and, while I don't know what the Chinese think, I know what they are saying. They have been saying for the last months that they want to diversify their reserves and cut their dependency on the dollar [1][2][3].
Moreover the Dagong Global Credit Rating, the state-owned chinese credit rating company, rates the debt of the US as A and the debt of Italy as A- (on a scale from CCC to AAA). That's a good hint at what China wants and probably thinks.
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They've been saying that for the last 10 years. It doesn't change matters that there isn't anything for them to put their money in.
http://globalpublicsquare.blogs.cnn.com/2011/08/14/why-china-needs-u-s/
http://www.realclearworld.com/articles/2009/02/why_china_needs_us_debt.html
