US - China Trade War ( What Happens If China Sells US Treasury Portfolio)
The US-China trade war is becoming a tensed one with the United States Threatening to place sanction on China over the origin of the coronavirus pandemic. It is true that the US and China have been going through series of trade wars in last 2 years because china seems to be affecting the US economy with importations. As at today, the stock market dropped over the tension between the two great nations.
The United States and the People’s Republic of China have always been in a mix event and having this trade war might not be the last we might hear about this two countries having mix issues. Since 1949 when Mao Zedong established the People’s Republic of China, The US have always been tense standoffs on China.
Although this trade war might improve America local productions but will China be willing to leave without a fight?
The United States is in so much debt but the most interesting part of it is that China is the United States biggest creditor follow by Japan. In case you do not know, the US is in a debt of $24 Trillion. The United States is in debt to China and you wonder why? Then let’s go back to the great recession in 2008, when China and Russia lent the United States money. China owned about $600 billion of the US treasuries but as the recession started, Russia sold their loans and also asked China to do the same but the Chinese government decided not to and fast forward to 2020, China now owned trillions of dollars of the United States debt.
What Will Happen if the Trade War Get Intense
People have been scared of the potential outcome to the United States economy if there is a trade war with China and this is on the basis that the China owns the a large amount of the United states Treasury portfolio and could sell it all.
What will happen to the United States?
If China sells the United States debt, it will affect the United State Dollar, it will hurt the United State Economy. Do not forget that the US is the one throwing the first blow here to China by placing Tariffs on China while China still holds an Ace card.
Why the fear?
In 2018, there was a trade war between the United States and China and The United States were scared of China selling off the United States Treasury portfolio after which everyone thought there would be a potential recession but that did not happen and now the US is on it again and this time they are more at risk because the economy is already shutdown and there is a confirm recession. What will now happen at this point if the trade war starts and china sells off the United States Treasury Portfolio? Maybe the economy will crumble completely.
This is often regarded as a US-China trade war but this war might eventually affect some other countries. This two economical giants can be very strong that they might have to pull other countries to join them.
That is the fear, these war might not remain within the country as it may escalate to other regions.
Resteemed already. Upvote on the way :)
Thanks @project.hope
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Thanks a lot
From time to time, Us have always been having issues with china. I just hope there is no trade-war between the two countries.
The truth this guys have a very complicated history together. This trade war might just not be good at this point in time.
If the US dollar is still being used as a standard for exchange, US will just get into more debt to pay China and starting a war won't scare the US.
I am sure this is one of US's fear. If the USD losses its hold as the exchange currency then the US economy will suffer.
China and The United State, if this country start a trade was, the UK will have to choose one of them which will also go to other countries in the world. People will have to take sides. The annoying thing is trump keeps saying this is a China virus but before the virus got to US, people said it was US who used the virus as a bioweapon.
The both countries never seize to amaze me. Other countries might have to take sides as an individual nation but when it comes to organisations like the UN, they have to find peace and not support one over the other.
Trump's government has made it look like the US was never a peaceful country. IS was very diplomatic about things until now. I hope there is no trade war between the two countries because the citizens will suffer for it.
The bad that ordinary citizens end up suffering more whenever there is an unfortunate situation like this.
Dear @futurekr
I just bumped into your older publication. I wonder if you will even read this comment of mine ;)
This conflict between US and China is very worrying for many. Thanks for sharing your insight on this paricular issue.
Solid read. Upvoted already,
Cheers, Piotr
I read your older comment and reply and i am doing the same to this which means i will always reply to comments :)
Thanks for reading my post and leaving a good comment.