China, the biggest foreign creditor of the United States, has waded into the American budget crisis, warning Congress that it must resolve the political impasse over the debt ceiling without further delay.
The Chinese Vice Foreign Minister, Zhu Guangyao, told America’s deadlocked politicians on Monday that “the clock is ticking” and called on them to approve an extension of the national borrowing limit before the federal government is projected to run out of cash on 17 October.
“We ask that the United States earnestly takes steps to resolve in a timely way the political issues around the debt ceiling and prevent a US debt default to ensure the safety of Chinese investments in the United States,” Mr Zhu told reporters in Beijing. “This is the United States’ responsibility,” he added.
“The US is clearly aware of China’s concerns about the financial stalemate and China’s request for the US to ensure the safety of Chinese investments,” he said yesterday.
China held $1.28tn in US Treasuries in July 2013, according to US Treasury data, although the true figure could well be higher than this as China also invests through intermediaries.
“The U.S. is the world’s biggest economy and a major country issuing reserve currency. Safeguarding the debt is of vital importance to the economy of the U.S. and the world,” China’s Vice Minister of Finance Zhu Guangyao told a press briefing held by the Chinese Foreign Ministry.
“This is the United States’ responsibility,” he said.
Under the current situation, Zhu advised the U.S. Treasury Department to take the first step to ensure the interest payments of the government bonds and then pay the principles through the replacement of old debt by new.
The good news is that China wants to keep lending us money they don’t have so that we can spend money that we don’t have on things that we don’t need.
The bad news is all of the above, plus that liberalism means that America is destroying its economy and its credit worthiness on Obama’s insane spending spree while acting as a hole for Chinese bankers to toss their money into.
Think of us as the people taking out subprime mortgages and China as the lenders. Except the lenders suspect that they’ll go bust before we do because their wacky mix of Crony Capitalism and Communism with heady doses of corruption is what we’re doing but without any of the environmental concerns.