I think this is just bluster. If the Chinese or any other country run a trade surplus with the US, that surplua of dollars has to spent on US goods and services. If they stop buying bonds, they will buy something else. Actually, I do not blame anyone for selling treasuries at their current prices they are very expensive and would be quite profitable for a lond term investor.
> If the Chinese or any other country run a trade surplus with the US, that surplua of dollars has to spent on US goods and services.
LOL! Excuse the laugh - you owe me a keyboard.
Where on earth did you ever get that notion?
They can - and do - spend that surplus everywhere else in the world, particularly in the EU and parts of Asia where they are building quite a bit of clout.
Here is how one poster put it: "While China invests in businesses, energy, metals, cheap labor (???) we invest in food stamps, unemployment compensation, stimulus tax credit checks, illegal immigrants, public sector unions, you can see where this is headed."