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Old 02-08-2010, 03:05 PM
BeanCounter BeanCounter is offline
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Tommy,

China has bought a huge amount of our debt. What happens when they decide not to buy any more. Simple, the US would have to offer higher rates to get someone to buy it. If the do that what happens to the value of the lower rate bonds that China now holds. That value goes down............on a huge amount of money. Boom, a gigantic capital loss for China. There's your bubble.
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