Saving the Net (Linux Journal) [LWN.net]

Saving the Net (Linux Journal)

Posted Nov 17, 2005 8:23 UTC (Thu) by Wol (guest, #4433)
In reply to: Saving the Net (Linux Journal) by kleptog
Parent article: Saving the Net (Linux Journal)

Anyways, what use is a carrier group if China decides to call in America's national debt?

Last I heard, China owned enough American bonds to repay their entire national debt in one hit. They've only got to threaten to dump a load of bonds on the market and America has no choice but to back down - or watch the Dow Jones implode...

Cheers,
Wol

(Log in to post comments)

Saving the Net (Linux Journal)

Posted Nov 23, 2005 3:16 UTC (Wed) by skybrian (subscriber, #365) [Link]

I'm no bond trader, but that makes no sense. They can't "call" government bonds, they can only sell them, at a price agreeable to a buyer. Selling a large amount at once and driving down the price would be a giveaway to anyone with the money to buy them and lock in a higher interest rate. (And, ultimately, since the government prints the money, they can buy all of them.)

Of course it's inflationary in the end...