China Claims Debt Will Not Be Used as a Threat

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China has publicly changed a tune:

  • JULY 8, 2010

China Says It Won’t Use U.S. Debt as Threat


BEIJING—China’s foreign-exchange agency sought to ease concerns about how it uses its huge currency reserves, saying it operates on market principles and would never wield its holdings of U.S. government debt as a threat.

The statement Wednesday by the State Administration of Foreign Exchange was the latest in a series of moves by the agency aimed at addressing concerns about its influence. Presented in question-and-answer form, the statement, posted on the agency’s website, rebutted what it portrayed as misconceptions about its management of China’s $2.4 trillion in foreign-exchange reserves, the world’s largest.

The statement rejected the notion posited by some analysts and American politicians that China’s large holdings of U.S. debt constitute a “threat” to the U.S. The agency said the market for U.S. sovereign debt remains an important one for China’s reserves, due to its security, liquidity, large capacity and low transaction costs…

In response to what it presented as a question about whether China would use its reserves as a “nuclear weapon,” Wednesday’s statement said such concerns are “totally unnecessary.”

Well, earlier this year, US Secretary of State Hillary Clinton correctly claimed that the debt is a threat to the USA.

Some Chinese officials have also stated that the debt is being used as a threat.  Chinese-run state media have called it their “nuclear option” (China Has Major US Dollar Reserves That It Can Cash In).  The “gold” comment is interesting, because while it is not in China’s interest to buy nearly up nearly all the gold (that would really make gold irrelevant around the world if it did that), China has been increasing its gold reserves and even encouraging their citizens to buy it.  But if it publicly claims that it will greatly increase gold reserves, it would drive up the market and make its purchasing more expensive for the Chinese.  So, publicly they have tried to minimize comments about the governments plan to increase gold reserves.  But it is true that gold is not the only, nor main, asset that the Chinese want.  They want oil, lumber, food, international ports, minerals, land, and political influence (and holding the debt gives them that last item).

Of course, this “debt will not be used as a threat statement” by the Chinese is nonsense.  Much of what China itself appears to be doing is consistent with what the late Deng Xiaoping once expressed,

China must hide brightness and nourish obscurity . . . to bide our time and build up our capabilities (Source: Times Online).

The reality is that of course China expects to continue to use the debt as a political weapon.  However, it is likely to hold on to it for too long and lose somewhat because of it (though it may end up with Australia as partial repayment as part of a European-brokered deal) as the USA will not pay it all back (and if it does, it would be in almost worthlessly devalued dollars).

It matters little what some in China publicly state about debt not being a threat, the Bible is clear that in the time of the end, a great indebted power will fall after its creditors rise up against it (Habakkuk 2:1-9).  According to the Bible, “the borrower is servant to the lender” (Proverbs 22:7).  The USA is insane if it believes that it is safe for it to continue to increase its debt with world powers like China and not face consequences from it.  The USA needs national repentance, not just placating statements from some of the Chinese.

Some articles of possibly related interest may include:

China, Its Biblical Past and Future, Part 1: Genesis and Chinese Characters This article provides information showing that the Chinese peoples must have known about various accounts in the Book of Genesis up until their dispersion after the Tower of Babel.
China, Its Biblical Past and Future, Part 2: The Sabbath and Some of God’s Witness in China When did Christianity first come to China? And is there early evidence that they observed the seventh day sabbath?
Asia in Prophecy What is Ahead for China? Is it a “King of the East”? What will happen to nearly all the Chinese, Russians, and others of Asia? China in prophecy, where?
Anglo – America in Prophecy & the Lost Tribes of Israel Are the Americans, Canadians, British, Scottish, Welsh, Australians, Anglo-Southern Africans, and New Zealanders descendants of Joseph? Where are the lost ten-tribes of Israel? Who are the lost tribes of Israel? Will God punish the U.S.A., Canada, United Kingdom, and other Anglo nations? Why might God allow them to be punished first?

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