China Considering Cutting US Dollar Reserves

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Devil = Secret + Person + Garden


China is publicly considering a different direction:

China should reduce its excessive foreign exchange reserves and further diversify its holdings, Tang Shuangning, chairman of China Everbright Group, said on Saturday.The amount of foreign exchange reserves should be restricted to between 800 billion to 1.3 trillion U.S. dollars, Tang told a forum in Beijing, saying that the current reserve amount is too high.

China’s foreign exchange reserves increased by 197.4 billion U.S. dollars in the first three months of this year to 3.04 trillion U.S. dollars by the end of March.

Tang’s remarks echoed the stance of Zhou Xiaochuan, governor of China’s central bank, who said on Monday that China’s foreign exchange reserves “exceed our reasonable requirement” and that the government should upgrade and diversify its foreign exchange management using the excessive reserves.

Well, China will exercise some caution here because in the short run, moving further away from the US dollar risks internal problems (like civil unrest) for China itself.  Yet, if China really were to stop buying USA debt and instead shift most of its holdings away from the USA dollar, this would cause economic chaos for 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).  Last summer, at least one Chinese official said that the “debt will not be used as a threat” (China Claims Debt Will Not Be Used as a Threat).

Of course, this “debt will not be used as a threat” statement by the Chinese is nonsense–the Chinese have used the debt as a threat.  The reality is that 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).

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).  According to the Bible, “the borrower is servant to the lender” (Proverbs 22:7).

Of course, the dollar is having trouble:

John Hummel, chief investment officer with AIS Futures Management LLC, which oversees $500 million in assets, said he is “extremely bullish on gold.”…

His primary argument: Central banks and private investors are increasingly turning to gold as an alternative store of value as paper currencies continue to fall…”At some point, foreign holders will refuse to accept greater amounts of U.S. debt or the dollar as reserve currency,” Mr. Hummel said in a note to investors.

No matter what the Chinese say or do, the Bible is clear that in the time of the end, a great indebted power will fall after its creditors rise up against it:

3 For the vision is yet for an appointed time; But at the end it will speak, and it will not lie. Though it tarries, wait for it; Because it will surely come, It will not tarry…5 Indeed, because he transgresses by wine, He is a proud man… 6 “Will not all these take up a proverb against him, And a taunting riddle against him, and say, ‘Woe to him who increases What is not his–how long? And to him who loads himself with many pledges’? 7 Will not your creditors rise up suddenly? Will they not awaken who oppress you? And you will become their booty. 8 Because you have plundered many nations, All the remnant of the people shall plunder you (Habakkuk 2:3,5,6-8).

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–it would be nice if some were motivated by it by the Chinese statements.

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?
Will the Anglo-Nations be Divided and Have People Taken as Slaves? Will the lands of the United States, United Kingdom, Canada, Australia, and New Zealand be divided? What about Jerusalem? What does Bible prophecy teach? Are there non-biblical prophecies that support this idea? Who will divide those lands? Who will end up with the lands and the people?

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