China Criticizes US Policy

It would appear that the largest holder of United States debt in the world, China, isn’t too happy with the financial direction of the United States. How can they be? China issued sharp criticism of the US policy just hours before Pres. Barack Obama began his Asian tour.

“Liu Mingkang, chairman of the China Banking Regulatory Commission, said that a weak U.S. dollar and low U.S. interest rates had led to “massive speculation” that was inflating asset bubbles around the world. It has created “unavoidable risks for the recovery of the global economy, especially emerging economies,” Liu said. “

The problem with the criticism is that it is accurate. The United States and the administration in general has has done little to show anyone in the world that they have a clue what to do with a failing economy. Throwing more money at the issue is not going to solve the problem. Stimulus number one already proved that. But, plans are on the table for yet another stimulus, to create more debt that we can sell to China and India.

I have a simple question. What happens when China and India decide they don’t want to buy our debt anymore? Those days can’t be far away. We can give lipservice to the economy getting better. The fact is it is not. We can throw more money at the situation, and that won’t help. It is said that there are some corporations in America that are too big to fail. I disagree with this philosophy. Is the United States to big to fail?