We can finally breathe easier: "Beijing vows not to use U.S. debt for political gain" WHEW, eh?

[Poll_Blind]

Good news: Beijing vows not to use U.S. debt for political gain.

That's right, the world's largest slave economy just sent us a bouquet of flowers with a lavender-scented note saying "Even though you gave me herpes I promise not to tell any of my girlfriends about it."

Sweet.

Who would have thought it would ever come to this? Nobody, that's who. Because this never happens, that's why. No, the only time you put out statements like that is two weeks after you've realized that the U.S. has passed a tipping point of debt from which it can never return. And that it's going to keep borrowing money from you all...the...way...down.

I have no idea where the bottom of that well is, but it probably makes the well in The Ring look like an all-you-can-eat buffet in Vegas.

Mr. Yi's delivered his verbal vote of confidence in Treasury debt a few days after the Congressional Budget Office issued its preliminary analysis of President Obama's budget blueprint through 2020. Publicly held debt is scheduled to soar by nearly $13 trillion during the 2010-20 budget period, the CBO said.

CBO expects U.S. publicly held debt to surpass $20 trillion at the end of fiscal 2020, reaching 90 percent of annual economic output. That is up from 40 percent at the end of fiscal 2008.

To finance this soaring debt burden, the U.S. government will have to depend on foreign investors, especially China, whose trade surpluses are likely to remain massive in the next decade.

Foreign investors now hold $3.5 trillion of publicly held U.S. debt, or nearly 50 percent of the total. That's up from $14 billion in 1970, or less than 5 percent.

Tell this to your kids, the ones who are sucking on the lead-painted trinkets they got at the dollar store. Can't tell the dog, dog died. Dog ate dog food. Silly dog.

China and Russia gave Communism a bad name and as they've perverted their own political systems into caricatures of their original intent, so have we in America turned Capitalism into a joke.

In this case, with one hell of an ironic punch-line. Don't you think?

PB

[w4rma]

1. BS. (nt)

[supernova]

2. You can bet your sweet CDS that the opposite is true

Get ready folks, they are about to call in our chips.

[Poll_Blind]

5. The country notoriously famous for BILLING the families of the executed for the bullets used is....

...going to cut US slack?

Yeah, I'm with you on this one.

PB

[LakeSamish706]

3. When does mandatory Chinese begin in our schools is the real question? n/t

[FarCenter]

4. They don't care what political system we have, so long as the tribute (interest) is paid

[The Magistrate]

6. That Sounds Like The Kiss Of Death, Sir

The open statement they are commencing to exploit our debt politically commencing on receipt of the note....

[OutNow]

7. In a related story - Hitler - Stalin sign nonagression pact

We know how that one turned out.

[Poll_Blind]

9. Indeed.... n/t

PB

[pampango]

8. But what are the Japanese saying? They hold more of our debt than the Chinese.

"Last month, the Treasury Department revealed that China's official holdings of U.S. Treasury debt declined from more than $800 billion in July to $755 billion in December. As a result, Japan replaced China as America's No. 1 foreign creditor."

""The U.S. Treasury market is the world's largest government bond market," said Yi Gang, the head of the State Administration of Foreign Exchange. "Our foreign exchange reserves are huge, so you can imagine that the U.S. Treasury market is important to us," he said during the annual session of China's parliament."

Lately, Obama has been meeting with whomever he wants to, allowing the sales of arms to Taiwan, and imposing tariffs on some Chinese exports to the US. Doesn't sound like he's too afraid of China holding the debt over our head. If China cuts back more on buying our bonds, either some one else will buy them or the interest rate will go up. That would hurt but it would not be the end of the world and it would hurt China. As the interest rates went up the value of our bonds they still have will go down.