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Çetin
Lv 5
Çetin asked in Social ScienceEconomics · 1 decade ago

do you think ,China is right to be concerned and worried about the security of the assets?

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  • 1 decade ago
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    Yes, they have every reason to be concerned. America has been running deficits for many years and now they are planning to spend up to trillions of dollars for the stimulus package and to prop up banks.

    America has no way to pay for this other than to print money due to the low savings of Americans. However, by printing money this will lead to inflation problems and that means the value of China $2 trillion assets will shrink since inflation erodes its value. China is concerned because they don't want to see all their hard-earned savings that they have lent to the US reduced to worthless papers.

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