Free Republic

Americans have an immediate problem that we all need to face! If government deficits continue to grow at current levels, America's sovereignty could well be at risk in just 5 to 10 years. Foreign markets including the Chinese and Saudi governments holds billions in American debt, Do you want these people to dictate our financial destiny. I certainly hope not.

"Otherwise Treasury securities will reach "junk" status sooner than I expected, But I canvery confidently predict that, in the long term, US debt will become "junk"!

BEIJING (Reuters) - China should gradually reduce its holdings of U.S. debt and can stop buying dollar-denominated bonds, a Hong Kong newspaper on Tuesday quoted Cheng Siwei, a vice chief of China's parliament, as saying. With China a leading financier of the U.S. current account deficit, Cheng's comments sent the dollar lower against the euro and yen and also pushed down prices of U.S. government bonds. The Beijing-funded Wen Wei Po daily carried Cheng's comments, made in Hong Kong on Monday, but it was not immediately clear whether they reflected those of top decision makers who determine the content of...

In late 2003, a Forbes review of former Treasury Secretary Robert Rubin's book "In an Uncertain World" noted: "Rubin is quite certain that eventually the huge deficit will push up interest rates on 10-year Treasuries from the current 4.5 percent to 7.3 percent. Jot down his arithmetic rule for future use: For every rise in the deficit equal to 1 percent of gross domestic product, figure that long-term interest rates will rise by 0.4 percent." Mr. Rubin was quite certain and quite certainly wrong. The budget surplus in fiscal 2000 was 2.4 percent of GDP. The deficit in 2005 was...

You don't need a fortune cookie to learn that China isn't playing straight with the rest of the world. The men in Beijing may be taking some of their clues from the most important page of Mao Tse-tung's Little Red Book: "Every Communist must grasp the truth, 'Political power grows out of the barrel of a gun.'" We've been lulled into thinking the Chinese brand of "free markets" will move that country toward democracy. Maybe someday, eventually, it will. But free markets must be accompanied by personal freedoms and representative government, and that isn't happening. In fact, there are disturbing...

DAVOS, Switzerland - China has lost faith in the stability of the U.S. dollar and its first priority is to broaden the exchange rate for its currency from the dollar to a more flexible basket of currencies, a top Chinese economist said Wednesday at the World Economic Forum. At a standing-room only session focusing on the world's fastest-growing economy, Fan Gang, director of the National Economic Research Institute at the China Reform Foundation, said the issue for China isn't whether to devalue the yuan but "to limit it from the U.S. dollar." But he stressed that the Chinese government is...

LONDON, Dec 7 (Reuters) - The notion that rating agencies may one day downgrade the U.S. government's triple-A bond rating triggered financial market discussion on Tuesday about the previously unthinkable and added more pressure to the dollar. An article in the Wall Street Journal Europe said that analysts and investors had begun to "question the unquestionable" amid worries about budget and trade deficits and the weak dollar. The article made no suggestion that any downgrade was actually in the works from the big three ratings agencies -- Moody's, Standard and Poor's and Fitch. But it cited a research note by...