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Thread: Foreign demand falls for Treasuries

  1. #21
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    Re: Foreign demand falls for Treasuries

    Quote Originally Posted by donsutherland1 View Post
    DOD should not be immune to being asked to become more productive, though one should not lose sight of the fact that the U.S. has a need for a larger and more effective military capability than many other countries do given its myriad critical interests. In fact, if DOD were exempted, such a move could actually undermine long-term U.S. national security capabilities. For example, if the operating costs associated with U.S. military operations grew sufficiently execessive relative to those of its enemies, that would increase the likelihood of success of relatively low-level attrition-driven campaigns conducted against the U.S. and its interests. The key for enemies would merely be to exploit U.S. financial challenges/inefficiencies until the U.S. operation became unsustainable from a budgetary or political standpoint.
    Yes, that was OBL's stated plan. And its been working! However, I do not understand what do you mean by this:"U.S. has a need for a larger and more effective military capability than many other countries do given its myriad critical interests."

    What are our myriad critical interests that require a larger more effective offensive military capability?

    Our current military spending almost equals the rest of the world combined. Why would cutting that spending by 50% hurt our defensive capability?
    Treat the earth well: it was not given to you by your parents, it was loaned to you by your children. We do not inherit the Earth from our Ancestors, we borrow it from our Children. ~ Ancient American Indian Proverb

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    Re: Foreign demand falls for Treasuries

    Quote Originally Posted by jujuman13 View Post
    China by selling a percentage of their substantial holdings of US Treasuries should be seen as sending the message to the US 'Get your spending under control'.

    Attempting to bring Left or right Politics into this discussion is merely a distraction.

    Simply put China is saying what every other holder of US debt is saying.
    There is no left/right issue with military overspending. Both parties have supported it and it is major part of our government's overspending problem.
    Treat the earth well: it was not given to you by your parents, it was loaned to you by your children. We do not inherit the Earth from our Ancestors, we borrow it from our Children. ~ Ancient American Indian Proverb

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    Re: Foreign demand falls for Treasuries

    Quote Originally Posted by Hatuey View Post
    You commented on Obama's "out of control spending". I pointed out you're a partisan hack who doesn't care about how the money is being spent unless there is a Democrat is in power.



    So it was okay when Bush was doing it. Not okay when Obama does it. Your selective outrage is quite obvious.



    There are no questions in your OP. Just silly rhetoric.
    You make a lot of false assumptions. The point is what happens to our economy and the value of our currency if China is selling off our debt?

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    Re: Foreign demand falls for Treasuries

    Quote Originally Posted by Catawba View Post
    The graph is striking to see how the debt grew after the unfunded tax cuts to the wealthy coupled with increased military spending under Reagan And W.

    The only time we leveled off the debt after Reagan was when we raised the taxes a bit on the wealthy and reduced military spending.

    If we are truly concerned about reducing the debt, we need to do the same thing today.
    You mean during Clinton?

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    Re: Foreign demand falls for Treasuries

    Quote Originally Posted by ptif219 View Post
    China is selling our debt what will this do to our economy? Obama's out of control spending may need to stop.


    FT.com / US / Economy & Fed - Foreign demand falls for Treasuries


    Foreign demand for US Treasury securities fell by a record amount in December as China purged some of its holdings of government debt, the US Treasury department said on Tuesday.

    China sold $34.2bn in US Treasury securities during the month, the US Treasury said on Tuesday, leaving Japan as the biggest holder of US government debt with $768.8bn. China overtook Japan as the largest holder in September 2008.

    The shift in demand comes as countries retreat from the “flight to safety” strategy they embarked on upon during the worst of the global economic crisis and could mean the US will have to pay more to service its debt interest.

    For China, the shedding of US debt marks a reversal that it signalled last year when it said it would begin to reduce some of its holdings. Any changes in its behaviour are politically sensitive because it is the biggest US trade partner and has helped to finance US deficits.
    I suspect we will see an increase in the US government purchasing its own debt using a third party as a middle man just as they have been doing recently.

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    Re: Foreign demand falls for Treasuries

    Quote Originally Posted by ptif219 View Post
    You mean during Clinton?
    Yes, during his administration we eliminated some of the tax breaks for the wealthy and cut military spending and our debt leveled off for the first time since Reagan cut taxes for the wealthy and raised military spending.
    Treat the earth well: it was not given to you by your parents, it was loaned to you by your children. We do not inherit the Earth from our Ancestors, we borrow it from our Children. ~ Ancient American Indian Proverb

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    Re: Foreign demand falls for Treasuries

    Quote Originally Posted by drz-400 View Post
    China has been keeping its currency artificially low (about 6.8 yaun per dollar).

    The dollar recently rallied recently due to the economic events in europe, so this may be an act by the chinese to maintain its pegged position on the dollar. I am not certain though.
    Chine lowered it's holdings in Q4, before the Euro went into the tank.

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    Re: Foreign demand falls for Treasuries

    Quote Originally Posted by Baralis View Post
    I suspect we will see an increase in the US government purchasing its own debt using a third party as a middle man just as they have been doing recently.
    Watch for inflation.

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    Re: Foreign demand falls for Treasuries

    Quote Originally Posted by Catawba View Post
    Yes, during his administration we eliminated some of the tax breaks for the wealthy and cut military spending and our debt leveled off for the first time since Reagan cut taxes for the wealthy and raised military spending.
    thats not what i see in your graph

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    Re: Foreign demand falls for Treasuries

    Quote Originally Posted by ptif219 View Post
    thats not what i see in your graph
    It not my graph, and I'm not surprised.
    Treat the earth well: it was not given to you by your parents, it was loaned to you by your children. We do not inherit the Earth from our Ancestors, we borrow it from our Children. ~ Ancient American Indian Proverb

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