China has threatened a “painful lesson” for the United States if Donald Trump persists in what it, along with our happy-to-oblige media, is calling a “Trade War”.
Why an attempt to make trade requirements between the USA and China more equitable would be characterized as declaring war is a little beyond my understanding. But let’s move on to what the “lesson” might be.
Logically, since China is our biggest creditor (it holds an astonishing $1.7 trillion dollars of our debt), it can sell off some of that debt.
I’m no economics guy, but what I’ve read is that this will probably spike our interest rates and diminish our dollar’s value. Presumably, that is the “lesson”.
But – and, again, I’m no economics guy so tell me where I’m wrong – if China does this, won’t their USA debt holdings take a hit too?
In other words, aren’t they susceptible to the same “pain” that we would be?
There’s an old saying: “Owe a man $1,000 and you are his slave. Owe a man $1,000,000 and he is your slave.”
That’s a little something China should be thinking about right now.
