China calls US debt deal immoral

[fd24]

The risk of America's possible default has echoed throughout the world with global stocks rallying following the House vote. But despite the immediate economic relief, more voices calling to replace the dollar as the world currency are being heard.
*World markets in Asia are rallying, buoyed by the deal finally passing. Many leaders are shocked at how little time it took for the US to pass the deal. Chinese newspapers are calling the entire US debt deal debate “irresponsible” and “immoral”. So although people are celebrating, there is a lot of cautious optimism in Asia. People do not want to jump the gun as they are worried things are not finalized yet.

Asia has a huge vested interest in what is going on in the United States. $3 trillion of US debt is held by Asian countries, primarily China and Japan. Confidence has gone down in Asia. Another thing that worries people in Asia is whether or not $2.4 trillion that is slated to be cut from US spending has become another sort of a political game in Washington.

Many critics of the US deal worldwide are saying that it is not going to help American unemployment in any way, which directly impacts the Asian economy as well. Asia is the manufacturing center of the world, so if the unemployment problem is not solved in the US that also means that consumer confidence goes down for America. And that in its turn means they are not going to be buying exports from Asia, which can really impact on jobs.

There also has been much talk in Asia about an alternative reserve currency or looking into a basket currency, including Japan and China as well.
Shame on american con men. Long live China

 

[LetsGetRowdy]

Chinese Yuan should replace the Dollar as world reserve currency.

 

[Sliver]

Chinese Yuan should replace the Dollar as world reserve currency.

You can start by letting yuan valuate according to the market.

 

[somebozo]

The principle of US financial institutions that is based on lending and usury is immoral to begin with. How can a nation survive on constantly borrowing money to spend more than its earns. It is a non sustainable cycle and leads to war which we are seeing today in Iraq and Afghanistan.

 

[Oldman1]

Chinese Yuan should replace the Dollar as world reserve currency.

Should do that. Being encouraging to do that but the Chinese refuse, I wonder why....

 

[khurasaan1]

The principle of US financial institutions that is based on lending and usury is immoral to begin with. How can a nation survive on constantly borrowing money to spend more than its earns. It is a non sustainable cycle and leads to war which we are seeing today in Iraq and Afghanistan.

This 2.4 Trillion $ deal amount is sanctioned to start a new World war.......against Pakistan , China and Russia......ummm.....

 

[khurasaan1]

Should do that. Being encouraging to do that but the Chinese refuse, I wonder why....

Cuz everybody needs a true currency and that is Gold only..........not the paper money ....cuz everybody can print that........

 

[khurasaan1]

You can start by letting yuan valuate according to the market.

The only solution to the world economic deception and default is to bring the Gold within our trade....the rest is all rubbish.......

 

[aakash_2410]

Chinese Yuan should replace the Dollar as world reserve currency.

Yuan and Euro is not that strong. China can re-value/appreciate their currency but that would mean less exports.

Japanese Yen can replace the Dollar but the world's second largest economy [China] would never allow that to happen.

 

[Maritimer]

After Putin calls the US 'parasites', China says the US is 'immoral'. Why don't they stop the rhetoric and actually stop trading in US dollar. The global financial system needs serious reforms.

Meanwhile, China has already dropped US credit rating.

 

[jha]

No, They should have let their country default....

 

[fd24]

No, They should have let their country default....

Let's start from the top. In the event of a default, the nation's pristine credit rating would be trashed. This would result in much higher borrowing costs for the country.
Next up - the US dollar would absolutely collapse, as confidence in the country and its currency would evaporate overnight. Some people point to a country such as Argentina as evidence that a debt default is not such a bad thing - well, the Argentine Peso isn't the world's leading reserve currency.

The collapse of the dollar would lead to a sharp increase in the cost of nearly everything, as more US dollars would be needed to pay for imports. The collapse of the dollar would lead to a massive increase in inflation.
Equity markets would crash. The housing market would crash even more as credit would become nearly impossible to obtain.

US consumers would be obliterated nearly overnight. Savings would be wiped out due to rampant inflation and the collapse of the major North American market indexes as well as the real estate market.

Companies would be crushed by a US consumer that would no longer have any buying power. In addition, credit would dry up virtually overnight, which would force untold numbers of companies to shutter their doors.

Unemployment in the country would spike to obscene levels. The country's "safety net" would likely no longer exist. Social Security would likely be a distant memory - we've raided the Social Security piggy bank to fund the nation's deficits over the last number of years - where would the money for Social Security come from in the event of a default? The US government owes programs such as Social Security, etc. more than $4.6 trillion.

The IMF has approximately $200 billion available in lendable resources. Let's assume that the US hit the IMF up for a loan - this loan would come with harsh stipulations, as we've seen in other countries over the past couple of years. The United States would need to make extremely painful spending cuts, which would throw the entire nation into disarray.

A US default would have dire ramifications on our major countries throughout the world, and it would be very likely that there would be a chain reaction of sovereign debt defaults.

This is just a taste of what would almost certainly transpire in the event of a debt default in the United States.
Lets get sensible they were never going to default.

 

[gambit]

Let's start from the top. In the event of a default, the nation's pristine credit rating would be trashed. This would result in much higher borrowing costs for the country.
Next up - the US dollar would absolutely collapse, as confidence in the country and its currency would evaporate overnight. Some people point to a country such as Argentina as evidence that a debt default is not such a bad thing - well, the Argentine Peso isn't the world's leading reserve currency.

The collapse of the dollar would lead to a sharp increase in the cost of nearly everything, as more US dollars would be needed to pay for imports. The collapse of the dollar would lead to a massive increase in inflation.
Equity markets would crash. The housing market would crash even more as credit would become nearly impossible to obtain.

US consumers would be obliterated nearly overnight. Savings would be wiped out due to rampant inflation and the collapse of the major North American market indexes as well as the real estate market.

Companies would be crushed by a US consumer that would no longer have any buying power. In addition, credit would dry up virtually overnight, which would force untold numbers of companies to shutter their doors.

Unemployment in the country would spike to obscene levels. The country's "safety net" would likely no longer exist. Social Security would likely be a distant memory - we've raided the Social Security piggy bank to fund the nation's deficits over the last number of years - where would the money for Social Security come from in the event of a default? The US government owes programs such as Social Security, etc. more than $4.6 trillion.

The IMF has approximately $200 billion available in lendable resources. Let's assume that the US hit the IMF up for a loan - this loan would come with harsh stipulations, as we've seen in other countries over the past couple of years. The United States would need to make extremely painful spending cuts, which would throw the entire nation into disarray.

A US default would have dire ramifications on our major countries throughout the world, and it would be very likely that there would be a chain reaction of sovereign debt defaults.

This is just a taste of what would almost certainly transpire in the event of a debt default in the United States.
Lets get sensible they were never going to default.

I take it you are one of Her Majesty's prized economists? Did the Nobel Committee missed your name some time in the past?

 

[luckyyy]

US can recover just by banning wall-mart to import cheap stuff from china....
it killing local US industry & rising unemployment...
walmart imports almost over $30 billion from china annually ...

 

[fd24]

I take it you are one of Her Majesty's prized economists? Did the Nobel Committee missed your name some time in the past?

No mate. I'm just good at cut and pasting what the world is writing. Why are you so super sensitive?