After President Obama decided to impose a 35 percent tariff on Chinese-made tires, China reacted angrily and predictably: threatening to impose its own tariffs on American auto products and chicken meat. Nationalist bloggers urged China’s leaders to Full Story »
Posted by Fabrice Florin - via New York Times (Editorials), New York Times (Opinion), Real Clear Politics
If it abruptly stopped buying Treasury debt, it would slash the value of its own, mostly dollar-denominated foreign reserves. But the United States would also lose. American consumers and companies would have to pay more for Chinese goods. And if China were to cut back its purchases of United States government bonds, the Treasury Department would have to raise interest rates, driving up the deficit even further.
just more effectively, mainly because of its far lower labor costs.
