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Old 8th August 2007, 07:59 AM
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Re: China threatens 'nuclear option' of dollar sales

Quote:
Originally Posted by Drewbert


This is what worries me most. Naturally, if you want the dollar to devalue against the yuan, why would the chinese want US assets, an asset that is going to depreciate. They will dump the depreciating asset for other currency and resources.

The US has to find other ways to reduce overspending, e.g., by tightening credit or raising interest rates - which is the main culprit leading to over consumption and excessive borrowing.
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