August 8th, 2011
02:04 PM GMT
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In China, the state-run media is full of scathing editorials about America's mounting debt. 

Commentary published by the Xinhua news agency over the weekend stated the U.S. should live within its means. The agency said the alarm has rung and Washington politicians need to stop playing chicken. 

An article in the Communist Party newspaper Global Times reads "The World Should Kick America's Behind". 

The downgrade of U.S. credit by ratings agency Standard and Poor’s from AAA to AA+ is feeding fears in some circles that China could damage the American economy, by selling its massive debt holdings. 

However, those fears are based on a couple of myths:

Myth #1: China has dominant ownership over the U.S.economy

China is the largest foreign owner of U.S.debt – with 1.16 trillion dollars worth of  Treasuries as of May.  That is a big number.  However, it is only eight percent of America's total government debt.

Myth #2: China could go on a selling spree

China might look to diversify its holdings over time (as in decades), but analysts say any sudden sell-off of U.S.debt would merely erode Beijing's own financial standing. 

Because of China's policy to keep the yuan low against the greenback and support its export sector, much of the nation's wealth is trapped in U.S. dollars. 

China is amassing huge dollar surpluses and can only invest those trillions of dollars in a deep and liquid market such as U.S. Treasuries.

What's more, China has done little to reform its economic system - like float the yuan. 

So as much as the nation criticizes the U.S., the S&P downgrade is now serving as a wake up call here that perhaps Beijing needs to alter its policies to become less dependent on Washington.



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soundoff (153 Responses)
  1. Shane fm WV

    China is not far away from revolution like what happening in Arab world, dictators in China arent going to play much with whats going on in America.

    August 8, 2011 at 2:15 pm |
  2. Dan

    S&P official said if the US had adopted a balanced budget amendment they would not have downgraded our rating because it would have shown a genuine effort to tackle our debt problem. Isn't that what the Republicans and Tea Party wanted? Those crazy Repubs and Tea Party guys.

    August 8, 2011 at 2:23 pm |
  3. Chuck Leonard

    Wake up call? The last ten years we've been getting a "wake up call", and now we're late for school. The credit downgrade is more like getting the covers ripped off the bed by dad. What is it going to take, a slap in the face?.

    August 8, 2011 at 2:26 pm |
  4. Wes

    Balancing trade with China is in our immedaite future. Even China is telling us to improve our economy! When will elected politicians get it? Trade moderation with China will begin to shift manufacturing back to the U.S., stabilizing the economy, which will encourage in investment in the U.S., create job growth, and revenues.

    August 8, 2011 at 2:27 pm |
  5. mm

    Americans need to stop importing Chinese cheep crap. Let's bring the manufacturing jobs back here. I bet Americans won't mind paying a little more for better made good – Made in the U.S.A. Then we China would get their butt kicked!

    August 8, 2011 at 2:29 pm |
  6. Concerned

    Considering that American purchases are driving the Chinese economy, and China has been doing their best to keep the dollar low, I find it amusing that China believes it can demand anything. I also find it amusing that they feel they are "doing the United States a favor" by lending money and buying dollars.
    The reality is that this cheap money is what led to out of control housing rates (due to low interest rates) and the eventual realestate bubble. People were purchasing more than they could afford, and the credit lne ran out.
    China would probably be doing the U.S. a favor by slowly selling their reserve in dollars, considering it would make American products more competitive. And I have yet to hear a politician begin to talk about saving the American manufacturing base, which is what ultimately will help the economy and save jobs, rather than ship the work to China.

    August 8, 2011 at 2:30 pm |
  7. Descarado

    Hope and Change? Evict Obama 2012!

    August 8, 2011 at 2:39 pm |
  8. Robert

    It is nice to see it publicly posted that China does not own America. The Chinese will bluster, but they know which side their bread is buttered on.

    August 8, 2011 at 2:42 pm |
  9. guest

    way to go china. you are only hurting yourselves. if you dont believe we are
    a good credit risk, take your money elsewhere. you arent going to find a better
    outlet for your goods with smaller risk.

    August 8, 2011 at 2:49 pm |
  10. john

    Should America's young be in the streets protesting what Washington/Wall st has done to this country?
    Should Americans march into Washington and arrest the entire republican party and hold public trials on the steps of the Capital?
    Should the youth of America emulate the british young?

    Is this our Egyptian moment missed?

    Are Americans apathetic?

    August 8, 2011 at 2:49 pm |
  11. hammerdsteel

    US....Woke up for 3 days of govt. rangling and bitching, went back to sleep! Zzzzzzzzzz!

    August 8, 2011 at 2:53 pm |
  12. Nuno

    All it would take for China to become the world's super power was to
    SELL all its dollars in one week

    August 8, 2011 at 2:53 pm |
  13. Joel

    This video, although perhaps a bit exagerated, may awake some alarming curiosity into the situation.

    http://www.liveleak.com/view?i=629_1312594600

    August 8, 2011 at 2:54 pm |
  14. Scott

    We should do what Trump said, tax China 25% for all imports from China. Come on Government.... start thinking of helping this country for once.

    August 8, 2011 at 2:54 pm |
  15. Nuno

    That's why I'm also buying what China considers to be valuable ;)
    You wont see me with dollares

    August 8, 2011 at 2:55 pm |
  16. scott

    china should shut the f up....before we write the chinese portion of the debt right off the books and freeze all chinese assets!!!!!

    August 8, 2011 at 2:56 pm |
  17. Wasted1

    The problem for everyone will be the exploding internal demand for goods and services by the newly middle class in BRIC/South Africa - and, for developed nations, a leveling of incomes. America spends more on its war machine than the rest of the planet combined. We are lunatics.

    August 8, 2011 at 3:02 pm |
  18. Matthew

    China has been waging economic war against America for far too long, and they're more than lucky that our nation has done little, if anything, to fight back. China might be a rising power, but it is one completely dependent on cheap exports to the United States and Europe, theft of technology from said places, a deeply undervalued currency, and a domestic property bubble and debt crisis far in excess of anything found in either the US, or the EU.

    Get the deficit down, then ban China from buying any more treasuries. Slap a 10%-15% general tariff on all imports from China in the immediate term, and develop a tariff system that completely eliminates any advantage they obtain by keeping their currency too low.

    Its time someone let China know they're playing with a very hot fire.

    August 8, 2011 at 3:06 pm |
  19. Earnest T Bass

    So, This is what I invested into Globalization for. Real good advice Fidelity. Just stay on the green line my A$$

    August 8, 2011 at 3:16 pm |
  20. William

    It is inevitable.

    Google "Yin, Yang and Political system"

    August 8, 2011 at 3:20 pm |
  21. Yeah right..

    USA # 2! USA # 2! USA # 2! USA # 2! USA # 2!

    Spare me China... go to hell.

    August 8, 2011 at 3:23 pm |
  22. Anpadh

    It is truly pitiful that America's best hedge against a discounted dollar is that too many people have too many dollars. That may serve as a temporary dam but, in a few years, or perhaps even just a few months, the world will find ways of getting rid of those excess dollars. It seems financial analysts have not heard the phrase, "Necessity is the mother of invention." If the world needs something better than US dollars, it will either find something or create something that meets the need. Short of the US joining the Euro community and converting its currency from the USD to the Euro, I cannot see any logical way that the US is going to keep the dollar's value stable, even in the short-term.

    August 8, 2011 at 3:24 pm |
  23. davegeorgia

    Timmy and his Trillion $$$ Trouble, blames S&P for the blunder? blames the Tsunami in Japan? blames the Tea Party? blames the Trouble from the Arab Spring? what about the TERRIBLE bo pres disregarding the ryan TAX REFORM
    and 4trillion$$$ Cut Cap and Balance that S&P advised? TURMOIL is the TRADEMARK of bo the ZERO admin, more ZEROES on the deficit, more ZEROES on govt spending, let's have no mo bo the ZERO, impeach indict incarcerate

    August 8, 2011 at 3:26 pm |
  24. James

    Clearly there is a propaganda war happening between the two countries.

    August 8, 2011 at 3:28 pm |
  25. Howlinwolves

    Does any news agency actually publish all relevant facts in any story these days?

    First of all....who the heck is S&P to judge America's creditworthiness? These are the same guys who gave AAA credit ratings to all the junk mortgage backed securities 5 years ago that brought our economy to its knees.

    Second of all....it's become obvious that the Republicans are willing to sacrifice the US economy in order to get Obama out of office next election. S&P entire executive team are staunch Republicans. Put the pieces together.

    Finally, who the heck is China to comment on another country's debt? The Chinese government lies about absolutely everything. Their true debt level is gigantic. All their road projects, dam building, creating ghost cities that no one ever moves into. To finance all this, the gov't loans money to corporations owned by the cities and this money is considered uncollectable....but it never appears as debt on China's national debt. Bloody hypocrites.

    August 8, 2011 at 3:30 pm |
  26. Shame on China

    An article in the Communist Party newspaper Global Times reads "The World Should Kick America's Behind". I say, go for it. Let's take off all our Chinese made clothes, stop buying chinese junk, so they can have full access to our behind so they can kick it all they want. I say China, don't bite the hand that feeds you.

    August 8, 2011 at 3:36 pm |
  27. Robert

    Chinese politicians do not sound too different from US politicians: both groups are SHORTSIGHTED and unable to properly plan for the long run. The USA is running up huge debts not caring about the future or what this does to its youth and children. The Chinese leadership is a one trick economic ponny also unable to see the long term consequences of their decisions... where would China be today if it carefully invested its surpluses internally to create PRODUCTIVE infrastructure INSIDE China that would benefit the people and producue returns on investment?

    August 8, 2011 at 3:38 pm |
  28. pkyl

    Typical CNN rubbish. Who exactly is dependent on whom ?
    The EU is China's biggest trading partner, not USA.
    Since when do you hold more sway than your lender ?

    August 8, 2011 at 3:39 pm |
  29. JC Inter

    Yes, if China dump its US T-bonds, herself will fall too. But if the Tea Baggers pull another debts ceiling fiasco at the end of Sept, ALL rating agencies will down grade us to A+. The perfect storm is brewing on the horizon, GOP needs to put those freeloaders under control.

    August 8, 2011 at 3:42 pm |
  30. NotYou

    Americans live within their means? Ha ha ha.
    Greedy, fat republicans will NEVER agree to such a thing. This country is going right down the toilet, and deserves to have it's ass kicked...the sense of entitlement, the "me first" philosophy, lack of concern for fellow countrymen...we are doomed.

    August 8, 2011 at 3:43 pm |
  31. zack912

    bring our troops home,we have drained all are resources robing iraq and afgan and losing generation of deaths caused by the wars.bring that money tab back home and renew are policy and free palistine and let the world live in peace.

    August 8, 2011 at 3:43 pm |
  32. Jarhead

    If China still refuses to float its currency within one month, the US should announce a change of currency and issue one unit of that new currency for two old dollars. The US would instantaneously cut its debts in half. And to please China further, that new banknote could be printed in red.

    August 8, 2011 at 3:43 pm |
  33. Ryan in Michigan

    It makes me wonder what China's credit rating is. I know Britain and Australia are higher than the United States now, but is China, or is their economy and government still too unstable?

    August 8, 2011 at 3:44 pm |
  34. Colmery

    At todays price all the gold in the world is worth about 9 trillion dollars – not enough to pay off the American debt. If the US Dollar gets replaced by gold then the price of gold will be several multiples of its current price, maybe $US5000 in a year, or much much more, depending how big the stampede is. I'd guess that just the prospect of that happening and the consequence for the volume of investment capital available for economic growth is enough to get US corporations thinking that they need to pay something like the tax that is paid in wealthy stable economies.

    August 8, 2011 at 3:45 pm |
  35. rosethornne

    Tax millionaires and billionaires, and charge third party political organizations a fee, and use that to buy back all debt held by China.
    Then, force a trade balance.

    August 8, 2011 at 3:46 pm |
  36. Ruderalis

    The real question here is, what dialect of Chinese should us Americans learn? I hear Mandarin is widely used.

    August 8, 2011 at 3:48 pm |
  37. 2bits

    America needs to kick China's behind.

    August 8, 2011 at 3:48 pm |
  38. Ruderalis

    The real question here is, what dialect of Chinese should us Americans learn?

    August 8, 2011 at 3:49 pm |
  39. HN

    Interesting!
    So China's tagging of Yuan on dollar now looks favorable to the US and unfavorable to China. Goes to say that sound principles always come through in the end. I think China has a unique lesson to learn here.

    August 8, 2011 at 3:49 pm |
  40. Geraint Owen

    What about the fact that china bought the treasuries – leant us the money – so we could buy their goods, thus helping them become more middle class? They encouraged us to help them do this...

    August 8, 2011 at 3:51 pm |
  41. sweet_genius1

    This is what China wants. Once they crush us, they will be the world's superpower.

    August 8, 2011 at 3:51 pm |
  42. proudamerican

    why should we care what china thinks? at least in america we have the right to bear children. heaven forbid if their first born is a girl.

    August 8, 2011 at 3:52 pm |
  43. KY usa

    We saw 911. Get ready for financial 911. Its on it's way. Once the trigger is pulled it's a no stop event.

    August 8, 2011 at 3:53 pm |
  44. Monta

    when i finished reading this article, i feel america is too arrogant. You keep raising your ceiling as you keep borrowing money, you can't just borrow new money to pay back old dedt, that's not gonna work in a long term. and why you just said you are not afraid of china selling it massive dedt holdings? do you afraid that world selling them? i know this would nver happen but my point is america should be more responsible to the world, dont just transfer some economic problems to other countries.. if you keep so arrogant, you are gonna lose dominant dollar position.

    August 8, 2011 at 3:54 pm |
  45. M

    Who cares what China thinks, or does for that matter

    August 8, 2011 at 3:56 pm |
  46. drew

    Americans are stupid. They voted for the Congress we have today. Its not really the Presidents fault. Congress wants to play games with the Debt, so if China wants out then we diserve it.

    August 8, 2011 at 4:04 pm |
  47. cedaly1968

    It is kind of interesting to me that after the long, hard cold war, America emerged victorious and created a Chinese Communist superpower who steals our intellectual property and constantly tries to hack our government and military networks. Maybe it's time to look at American corporate global sourcing a little more intelligently?

    August 8, 2011 at 4:04 pm |
  48. drew

    Americans are dumb

    August 8, 2011 at 4:06 pm |
  49. Staci

    Could care less about what CHINA is saying. HOWEVER the U.S. needs to stop kissing a** of China and start thinking about their own people!!

    August 8, 2011 at 4:08 pm |
  50. Ed Hill

    Our pathetic polititions.Get out, go home.Replace all of them!We need people who can lead.

    August 8, 2011 at 4:10 pm |
  51. Historian65

    I read this and I think, "of course China must and will protect itself." What ambitious nation wouldn't? I would be shocked if China's long-view thinkers are not already working on ways to develop the country's potentially massive DOMESTIC economy. When that happens China will no longer be vulnerable to US internal political struggles. When China can lift a larger percentage of its population out of poverty, and that population buys Chinese-made goods, then the country will have greater power. When China no longer needs the US to buy its products, the entire global game will change. China will dictate its term as the US has been doing for so long. It's happened before. It will happen again.

    August 8, 2011 at 4:12 pm |
  52. RIDGR

    What would happen to China if the US pulled its companies and jobs back to America or another country? Would they still be making $ if they weren't selling products to the US? They'd be making only the $ we owe them? China products are the worst, just buy something on eBay!!! I don't understand why everyone is worried? The Fed are like migicians, making $ out of thin air. And how can you make $ if it never existed to begin with? That's what I don't understan, so if anyone can clarify in laymans terms. Thanks

    August 8, 2011 at 4:14 pm |
  53. gypsy0032

    WE need to become less dependant on China. If it says "made in China", walk away. I try to do this in favor of "made in America" as much as possible.

    August 8, 2011 at 4:17 pm |
  54. Roelof

    Last crisis whole Hong Kong was filled with empty ships. With the rising food prices and another crisis in the US, China could end up with a civil war.

    August 8, 2011 at 4:17 pm |
  55. Ramrod

    The rating game is sort of Mickey Mouse. AAA, AA, A. Did I ever hear about a B or a C? In my school there were grades of A, B, C, D and Fail. The teachers never awarded an AA grade or a AAA grade. So if the US could get its house in order do we get an AAAA grade?

    August 8, 2011 at 4:17 pm |
  56. Ron O

    We need cut spending by an additional 2 trillion and find a way to initiate a tax that EVERYONE has to pay into that is specific to paying down our debt for a set # of years.

    August 8, 2011 at 4:18 pm |
  57. Name*speedslowly44

    While it is good to know that China 'does NOT' hold all of the US's debt, you have to admit that EVERYTHING they are printing about "the US debt" is SO VERY TRUE! Our government DOES NEED TO LEARN TO LIVE WITH IN IT'S MEANS.

    August 8, 2011 at 4:21 pm |
  58. Onegood1

    Please view our debt and spending crisis in a rational way. Once you see that excessive spending is ruining this country, I invite you to join us at the next Tea Party rally in your area. Let your voice be heard that you do not want the U.S. to become a communist country as Pelosi Obama & Reid (POR) are trying to make us.

    August 8, 2011 at 4:21 pm |
  59. patrick

    I solved the equation to SAVE THE US ECONOMY!!... we don't quit barrowing from China, rather, we barrow more, barrow, barrow, barrow till they say, "no more," now here is when we tell them GFYS, and refuse to ever pay them back. we don't stop there, to show the world we're not being cheap–we continue making payment on our debt, but we pay Tibet instead, shouldn't have messed with Tibet, sorry China...I'm sure we can get the rest of the world behind this plan(except China)

    August 8, 2011 at 4:22 pm |
  60. bullock.

    I'm belived that timothy gantheir and presdient obama are too many problems with job also amercian want get out of presdient obama cause he make too many of risk

    August 8, 2011 at 4:22 pm |
  61. Eric in RTP

    The PEE party and neocons would have you believe that China has us by the balls, until a Republican is in office... then deficits and debt don't matter

    August 8, 2011 at 4:25 pm |
  62. shawn

    I think we need to stop being big brother to the world and worry about are selfs!!!!

    August 8, 2011 at 4:27 pm |
  63. toby

    the argument in this article is incredibly weak

    August 8, 2011 at 4:27 pm |
  64. Justin

    American flag should be a bar code america sold it self hitler predicted all this hitler should of won the war we should follow hitlers blue prints

    August 8, 2011 at 4:27 pm |
  65. Ferd of Aragon

    China is nothing if all Christians stop buying chinese goods till China stops oppressing Christians!

    August 8, 2011 at 4:28 pm |
  66. Mca

    Mr. Fear is so dominant right now, it is so thick, the fog caused by Mr. Fear that no one can think or see rationally. Pepper fear with uncertainty, distrust, structural dysfunction and lack of leadership, it make a perfect recipe for chaos. There was an old story about a man meeting Mr. Plaque, the man ask if he is going to end it and Mr. Plaque answered, no, I will just probably end the lives of a few thousand but my brother Mr. Fear will do the rest.

    We should all calm down. Panicking won't add a single percent to the DOW, S&P or the overall economy. Of course, there will always be a few significant entities that would profit from chaos but they also know if it continues they'll lose too in the long term.

    Stop the fingerpointing and bickering. It seems the primary reason for the S&P downgrade has not gone through our heads. It is the politicizing of the debt problem. Truly, if one really wants to solve a problem, one would be openminded and set aside long held beliefs in order to find viable solutions.

    China will rant and rave, much like some in America will continue to point and bicker but in the end, no matter how hard it is to accept. The world is getting smaller, China needs America. America needs China. The world need each other. For now, let us get our House in order so we can tackle the world. The whole world wants and demands it. Let us all calm down and those in power to lead (the Congress and the President) stop thinking about politics and do what needs to be done – work on cutting debt AND raise revenue. This is basic budgeting 101 for any household. Most Americans understand this. Is it fun-no. Do we enjoy this- no. But most Americans know deep down it needs to be done if we want to survive long term and if we want our future and the future of our children to br bright. The idea or act is not new. It has been done in generation past. It just happen it is our time.

    August 8, 2011 at 4:29 pm |
  67. Captain Nemo

    Thank you, oh wise and noble Tea Party solons,

    Blind to the true outcome of your Koch-corporate overlord’s plan, overlords who, with patriotic clamor, are shorting the dollar;

    Thank you, and your deluded followers who wear ill-tempered, foul, hateful ignorance and pride as badges of honor:

    Thank you for raising the interest rate on our children's children,

    For dooming generations unborn to a life of debt bondage, a state illegal in most of the civilized world.

    Hail, oh wise, so noble Tea Party zealots

    And the GOP apparatchiki you terrify,

    All of you so insulated from, so denying of the evident, predictable, avoidable, inescapably immoral consequent vicissitudes of this folly.

    If we raise the entry age for SS and Medicare, if we pare waste and fraud in both, will you,
    Tea Party alleged patriots, then sign off on:
    Raising the corporate tax rate on profits from phony offshore mailbox addresses
    Closing loopholes on corporations making massive profits
    Ending corporate welfare for entities making massive profits?
    Raising the tax rate on those who have seen nothing but rate drops since the 1980s (hint: that is the RICH, not the poor).
    Will you?
    How about this:
    Will you drop the corporate tax rate ONLY FOR PROFITS CREATED IN THE US? Specifically, if your profits, your headquarters, your jobs, your manufacturing, your R&D are all on US soil, you get taxed at or less than the lowest overseas corp tax rate. Will you sign off?
    We bribed our companies with tax breaks to ship our economy offshore (like saving water and plant food by cutting off a flower’s roots). Let's bribe business with tax incentives to bring it back home...

    Why NOT, oh wise, oh noble, oh fair and balanced Tea Party delusion dwellers?

    Oh, why not?

    August 8, 2011 at 4:30 pm |
  68. gabed53

    China is a threat in the sense that they ever more publicly criticize the US. They obviously want to push us over and take a bigger role in world influence, I believe we should lightly increase tarriffs on products coming from china and provide a means for bussinesses in the US to acquire capital to create more compitition in the global manufacturing market hence creating jobs , let alone china's huge investment in industrial espionage wich in turn saves them the cost and labor of research and innovation. Wish some our leaders would read more of machiavelli and such

    August 8, 2011 at 4:31 pm |
  69. Amit-Atlanta-USA

    Truly common Americans, especially the Independents (like me) who have the brains NOT to toe either the GOP or the Democrat, and also now the WORTHLESS Tea-party agenda are the ones who have paid the greatest price in this destructive game of brinkmanship.

    Quite frankly the rest truly deserve it!

    Hopefully, this debate will be a trend setter for Americans to think a little harder while viewing issues from both sides (if they indeed have the ability to think!), or at least listen to opinions of unbiased experts before betting their horses!

    The debate clearly shows a lack of leadership in both the camps, more so in the GOP who have literally been hijacked by the worthless tea-Partyers. While all along many Americans thought Sarah palin was the stupidest & meanest of all American politcians, Michelle Bachmann with her stand on this issue has clearly surpassed Ms.Palin in exposing herself to the levels she can stoop to, just to get elected!

    Amit-Atlanta-USA

    August 8, 2011 at 4:31 pm |
  70. Cody

    I say we do the American thing here. Don't pay. It will be like stealing. So what we go to war with China. It is going to happen any ways.

    August 8, 2011 at 4:36 pm |
  71. JoeMichigan

    Since no one really knows the Chinese balance sheet, it is all just pure conjecture. We have over valued the Chinese and over estimated their true financial standing. If the US stopped buying Chinese products for just a two month period, the Chinese economy would take a massive financial hit. This should be done now. Stop buying Chinese for 60 days, don't buy the thing you need in only a Chinese product is available. If a product is made by an American company in America then buy that one first even if it costs a bit more. We need to change the economic environment by buying Americas products first and start to create American jobs on American soil.

    August 8, 2011 at 4:39 pm |
  72. tom

    When one (the U.S.) owes the bank (China), $1,000, then the bank owns you.
    When one owes the bank billions, then we own the bank.
    Tell China to kiss the ar$e they want the world to kiss.
    Let me say it again: "China, kiss our ar$se"

    August 8, 2011 at 4:39 pm |
  73. PureLogic

    NOW is the Tea Party happy?

    August 8, 2011 at 4:40 pm |
  74. tom

    TYPE CORRECTED:
    When one (the U.S.) owes the bank (China), $1,000, then the bank owns you.
    When one owes the bank billions, then we own the bank.
    Tell China to kiss the ar$e they want the world to KICK.
    Let me say it again: "China, kiss our ar$se"

    August 8, 2011 at 4:40 pm |
  75. Tom

    The Commies don't understand when we go down they go with us. I agree we should live within our means and manufacture again in the US.

    August 8, 2011 at 4:44 pm |
  76. Roelof

    Canada is AAA rated, Denmark is AAA rated, Germany is AAA rated, Finland is AAA rated, France is AAA rated, Luxemburg is AAA rated, Norway is AAA rated, Austria is AAA rated, Singapore is AAA rated, Sweden is AAA rated, Switserland is AAA rated, UK is AAA rated, Holland is AAA rated, US... oh wait..

    August 8, 2011 at 4:53 pm |
  77. Matt in Fort Lauderdale

    I agree... it is time that the US start living within its means. And doing so we should immediately bring all troops home–from EVERYWHERE. Cease all foreign aid YESTERDAY and stop being the ATM of the underdeveloped world. Who will assume this role... well China will. The are such a rich and prosperous nation, it is time for them to take the torch and lead. Then they might see how easy it has been for them to sit, judge and criticize without being accountable.

    We would have our budget balanced and debt paid off real quick if someone else gave the world their allowance.

    August 8, 2011 at 4:54 pm |
  78. Matthew

    Actually Japan is the largest holder of US debt:
    http://news.xinhuanet.com/english2010/business/2010-02/16/c_13177277.htm

    August 8, 2011 at 4:54 pm |
  79. That'snotTrue:[

    Well investing in gold or silver is better than investing on debit bonds which have a possibility of being paid back with an inflated currency.

    August 8, 2011 at 4:54 pm |
  80. Bob

    China has NEVER had an accurately valued currency. With the government setting the price of almost everything in China, their economic situation is far less transparent that that of the US or most other governments. The only reason they have any value to their currency at all is due to US trade. If they keep mouthing off they are likely to ruin their own economy.

    August 8, 2011 at 4:57 pm |
  81. Ridiculous

    Ridiculous article, why does China need to wake up ? If any nation needs a hard swift kick in the nuts its the US. $14 trillion in debt and only a AA+ rating ? Even a freakin monkey knows that being $14 trillion in debt is horrible, but hey then again the Fed can print more money, sooner or later we will be using dollar bills to wipe our arses. Obamamama has failed in so many campaign promises that it is not even funny, do not promise what you can not deliver. Your speeches are empowering but then again so were Hitler's. There is always room for you in Hollywood, as you do make a fine actor, the next Denzel Washington or Samuel Jackson perhaps. Retire, sit down with Bush and play battleship.

    The US needs an entirely new form of leadership and direction.

    August 8, 2011 at 4:58 pm |
  82. SMARTAZ4U

    Nothing like having your bozom buddy talk about how we need our ass kicked when we need a friend...we should take our Wal Mart back.

    August 8, 2011 at 4:58 pm |
  83. RON PAUL 2012!

    THANK YOU DEMOCRATS! I had forgotten all about my 401k until now. Wish I had thought about it a couple of weeks ago before you trashed the market.

    August 8, 2011 at 4:59 pm |
  84. USf8tsback

    we should stop buying cheap stuff from China and start manufacturing

    August 8, 2011 at 4:59 pm |
  85. cj

    If the American people want to send a message the worst thing we can do is reelect any politician currently in office. If we do we are approving of the mess they have made. Now I would LOVE to see us replace them with independents but if all we do is swap parties it may help a bit.

    August 8, 2011 at 5:03 pm |
  86. Robert Perez of Guam, USA

    China is on the rise and that's a good thing. Here on the American island of Guam, we are only about a 4 hour flight to China. Our island's industry is based on tourism and the vast majority of our tourists are from Japan. But with China becoming richer, more Chinese will be able to travel to Guam. With a billion-plus population, China holds so many future tourists for Guam. This will help Guam's economy, and the American economy in general. A myth a lot of folks in the U.S. mainland think is that while China's economy is on the rise, the people are too poor for overseas travel. But that myth is so wrong. Millions of Chiense have the wealth to travel but due to strict travel visa restrictions to visit the U.S., they don't go there but elsewhere. If the feds only made getting a travel visa to the U.S. earlier, so very many Chinese would be visiting the U.S. and helping our nation's economy.

    August 8, 2011 at 5:05 pm |
  87. Roland

    Show me where the surpluses come from. Its the ultimate game. If 70% of their economy is based on Construction. That contruction money from the central bank. Again show me where the surpluses come from. Since the central bank cut them off the construction projects that is. States have found unique ways to lend money for the projects. Thus eroding the power of the central BANK. Creating HUGE RED ink. Also the construction isn't demand driven its driven simply like the US was that I can make quick money by buying property. But its property priced where no Chinese can afford. So whole communities lie empty. States are bleeding red from defaults. And you downgrade Fannie Mae and Freddie Mac.

    August 8, 2011 at 5:11 pm |
  88. RickF

    This entire Mess is Chinas fault to begin with; they purposely keep their dollar low to allow them to produce goods at a very cheap cost. They also do not trade fairly, and then they want to tell us how to conduct business and to get our act together? Seriously China, piss off and eat shit! They want us to buy from them, but in the long term do not buy US goods. They have created this Hugh unbalanced trade system that it is now out of hand and caused mass unemployment here. There are so many other issues too that go along with this. Like the greedy bastard Corporations looking to make a quick easy buck. Those Soldiers that died over the weekend, I wish that helo was full of our politician and that they were the ones to go down in flames in that Helo. Enough is enough already, and our Govt needs to wake up.

    August 8, 2011 at 5:12 pm |
  89. william nkume kome ebang

    even if America folds her hands for the next century,china will never be like her. i hate the chines system and 'ove my America with all my heart'.

    August 8, 2011 at 5:13 pm |
  90. Richard Click

    No one forced China to buy treasuries. The good old Capitalist USA needs to tack on a buying charge for countries buying our treasuries to help pay down the debt. Our Socialist President and members of Congress want to "give" everything away. Why isn't Iraq and Afghanistan paying us to fight their terrorists? I say get our troops out and let them eat the sand and go back to riding camels. China grows stronger every day because they don't get involved and they don't spend millions and billions and trillions fighting someone else's wars.

    August 8, 2011 at 5:16 pm |
  91. jorge washinsen

    This is a sell off that the big dogs get rich on. They all bailed out at the high prices on the backs of the small people who depend on stock prices to stay up for part of their income.the big dogs are selling out an sitting on their profits for about 85 days and then they will buy back at the cut rate price to avoid taxes..It is a big game that the little man can't play if he sells. It will come back If it was a good stock to start with.If it does not we will all be in the same boat. NO is the time to buy not when the crooks are waiting for the little man to jump in on a high market.This downgrade is a ruse that only stupid falls for.

    August 8, 2011 at 5:17 pm |
  92. Massbytes

    China is a big part of the problem. They hold their currency down, we buy their too cheap junk, they have our money, we have their junk. And they have the nerve to gripe. Communist clowns they are.

    August 8, 2011 at 5:18 pm |
  93. jorge washinsen

    J. Edgar you could do well to listen also. Your future depends on the middle class for your check also.

    August 8, 2011 at 5:19 pm |
  94. RON PAUL 2012!

    THANK YOU DEMOCRATS!!! Bunch of idiots!

    August 8, 2011 at 5:22 pm |
  95. MeChineseMePlayJoke

    The Chinese government is a joke. They will not learn the errors of their ways until it's too late.

    August 8, 2011 at 5:23 pm |
  96. David D.

    First consumer debt, then crisis, then government debt and downgrade. What caused it?

    We lost sight of a fundamental truth, which is that an economy is built one job at a time...and we have been exporting jobs with a vengeance since the mid-1990’s. The U.S. only added a net 2 million jobs from 2000-2010, versus 15-20 million in each of the three prior decades.

    How did this happen? First, according to Harvard’s Niall Ferguson, our economy has only grown about 1% for a decade, if you exclude bubble-related borrowing and spending and heroic government intervention. We need 3% (Okun’s Law) to avoid increases in unemployment. In other words, the bubble hid reality. China’s share of global manufacturing grew from 5% in 1996 to around 12% by 2008. U.S. manufacturing employment declined from 17 million in 2000 to 12 million by 2011.

    The trade deficit (imports greater than exports) grew from about 1.5% GDP in 1996 to about 6% GDP in 2006, when it peaked at over $700 billion. Today, we have a $650 billion goods trade deficit, which represents about 10-15 million jobs overseas making our goods and oil. Over $220 billion of this annual deficit is with China. We must borrow money from China to buy their goods; this is a mathematical identity related to the trade deficit, a rule that must hold true by definition.

    Why the consumer debt? We are borrowing to sustain our living standard, which must fall if the jobs go overseas and our wages stagnate, because our employers can shift jobs overseas or are required to pay massive healthcare costs on our behalf.

    Why the financial crisis? Massive credit inflows from abroad to finance our trade deficit helped fund the housing bubble. This was one cause among many, but a huge part of the money inflow to the country went into mortgage-backed debt.

    Why the government debt? Stimulus, bailouts, revenue declines due to the unemployed, and additional safety net spending.

    Today, Apple employs 25,000 U.S. workers and 250,000 overseas; this 10-1 ratio is typical of high-tech companies today. If U.S. innovation creates most of the jobs overseas, this isn’t going to get us out of this mess.

    The pursuit of cheap goods is coming back to bite us; the “China Price” does not include our unemployment and stagnant wages and interest on the money we borrow to buy the goods.

    Until we and the rest of the developed world wake up and stop exporting our jobs for what we though was a free lunch (cheap goods) this will continue. Until we stop trading freely with low-wage countries, our economic stagnation and climbing debt will continue.

    August 8, 2011 at 5:28 pm |
  97. lutherwang

    are you trying to instigate the relation between two countries, Chinese newspaper never report the news like that, and Chinese people doesn"t want to kick American people"s back, you are so mischievous on posting this. Chinese government has its own reformation policy and they never depend on washington. Every payment for Chinese people is the proof of their hardwork. Please don't play this trick and distort the truth. Thank you.

    August 8, 2011 at 5:31 pm |
  98. ChrisM

    “It happened on your watch, Mr. President,” screamed Michele Bachmann, exhibiting the full extent of her knowledge of economics. This teabag candidate was one of the FIRST TO CALL FOR A DEFAULT. Does this VERY UN-INFORMED
    TEA PARTY MEMBER think Americans will elect her to ANYTHING. What a very stupid person.

    August 8, 2011 at 5:36 pm |
  99. G Forrester

    The best thing that could happen to the world economy is to tie the most advanced economy [USA] to the most populous.
    [CHINA]. What do you suppose would have happened if they were not mutually dependent on each others success, we would be at war with each other already. This was the very idea behind bringing China and other nations into the capitalist
    system.The world economy is not broken it needs to be expanded with a significant dose of social engineering the very thing that Wall Street frowns at.We cannot practice " Winner Take All Capitalism " endlessly it will create the kind of Imbalance that landed us in the present predicament where a vast disparity between real estate cost and wages derailed the economy. How many recessions inspired by real estate fraud do we need to experience before we lear
    that greed and avarice are not liberties we can freely indulge in. Politics in America may not allow the Republicans to speak honestly about the cause of our present calamity but a solution will not be found if we afraid to be honest with ourselves.

    August 8, 2011 at 5:38 pm |
  100. KLM

    China's take on this is laughable. They really are more ignorant that I would have ever imagined. They cheat with their currency and wonder what happens. Anyone who takes paper for finished goods over that span of time and in that amount is clearly clueless. How did they think cheap plastic junk would have given America the potential to earn more money? None of their money went to infrastructure or really anything that would create a return. All I see to to anything they loose is a correction of value to what they have shipped us. Honestly if anyone cares or takes one word they say seriously I have some ocean front property in Arizona I'll give them a great deal on.

    August 8, 2011 at 5:42 pm |
  101. chinaFinance

    What's more, China has done little to reform its economic system – like float the yuan,
    is wrong.
    China this year has increased the value of yuan by 5%, Eunice Yoon you fail!

    August 8, 2011 at 5:42 pm |
  102. Fred54

    Is Ms. Yoon absolutely out of her mind? "Beijing dependent of Washington"??? Try the other way around. Washington
    is dependent on Beijing. China is the largest REAL holder of US debt because it buys treasuries with is US dollar
    liquidity. The largest overall holders are the Federal Reserve banks themselves that simply monetize the debt which is
    driving inflation and crushing the dollar. Why do you think gold is now headed to $2,000??? They, the FED, are forcing
    a default on ALL US debt by inflating it away.They have to print the money to buy it?? Hello??? Are any of the editors at
    CNN paying attention??? If China sneezes and starts selling treasuries at a discount the rest of the world will read that
    as a move away from the dollar as a reserve currency. That will very likely trigger a run on the dollar because
    countries won't need as many dollars anymore. The Chinese understand perfectly that their investment in dollars is
    being inflated away so they will do what any business would do. They will cut their loses. Articles like this are beyond
    irresponsible.

    August 8, 2011 at 5:46 pm |
  103. SURESH SHARMA

    IT IS LESSON FOR AMERICON TO SAVE TODAY FOR TOMARROW,OTHERWISE THE BAD HABIT OF DEBTS WILL SHOW THE WAY TO HELL TO ANOTHER COUNTRIES.TODAY THE WHOLE WORLD FACED THE GLOBLE CRICES BECAUSE ONLY THE AMERICAN ARE RESPONSIBLE FOR THIS CRISES.

    August 8, 2011 at 5:48 pm |
  104. chinaFinance

    contact if you want tips on how to report financial news.
    Sandy Hendry at shendry@bloomberg.net
    http://www.bloomberg.com/news/2011-02-08/china-s-yuan-seen-reaching-17-year-high-on-rate-increase.html

    August 8, 2011 at 5:52 pm |
  105. Jib76

    To get out of the mess we are in there will need to be some major changes in the federal government's regulation of financial institutions and federal government fiscal and monetary policies. Deregulation of financial instutitons by Presidents Reagan, Bush Sr, Clinton, and Bush Jr allowed them to bundle sub-prime mortgages into $1.5 trillion in AAA rated bonds (by Standard and Poors, Moody's and Fircth). AIG insured these worthless bonds for $1.5 trillion. When Americans found out that the bonds were worthless, Bear Sterns, Leaman Brothers, Merrill Lynch and AIG collapsed. Bush Jr had to ask Congress for the $700 billion TARP. This wasn't enough to avoid a complete collase of the US financial system so Obama asked congress for a $700 billion stimulus. No S&P says that US treasuries are not AAA. Yes the same S&P that rated worthless sub-prime mortgage bonds AAA that got us into this mess. Interestingly S&P says Congress should have closed tax loopholes that exempt US millionaires and billionaires and corporations from paying billions of dollars of taxes.

    August 8, 2011 at 5:56 pm |
  106. KLM

    China's take on this is laughable. They really are more ignorant than I would have ever imagined. They cheat with their currency and wonder what happens. Anyone who takes paper for finished goods over that span of time and in that amount is clearly clueless. How did they think cheap plastic junk would have given America the potential to earn more money? None of their money went to infrastructure or really anything that would create a return. All I see to to anything they lose is a correction of value to what they have shipped us. Honestly if anyone cares or takes one word they say seriously I have some ocean front property in Arizona I'll give them a great deal on.
    They don't get it. We have everything. We have the most intelligent hardest working work force in the world. We have the most creative people on the planet. We have a solid infrastructure. We hold massive amounts of natural resources while we use the rest of the worlds in the meantime. We trade them paper for their resources. We have the most heavy equipment. We have the most homes. We have the most advanced military and no amount of money in the world can match us. We win because of our people. The most precious advantage we hold is food. No other country in the world can match our food production. If we cut them of they fall hard. China has destroyed their most fertile farm land. They import food to survive. If we chose they don't eat and there is nothing they can do about it. The deck is stacked in our favor I just wish more Americans would see it and stop paying attention to the bogus news.

    August 8, 2011 at 5:56 pm |
  107. stormsun

    Business executives and American government officials need to remember something crucial – China is not America's friend or ally. China (the government, not the people) views America as their enemy and rival, ideologically and economically. China is using the billions of dollars they are now raking in to build up their military at an accelerated pace. So one has to ask: who do they feel threatened by that would require a massive increase in advanced military technology? It isn't Tibet. It isn't Korea or Pakistan or any of their near neighbors. Japan does not pose a military threat to them. It could be Russia, but they seem to have things worked out between them. China, historically, has not been externally expansionistic – but many countries that have found themselves on the ascendency in terms of economic and political power are tempted to do just this. And in the case of a closed, oppressive government like China, and external "threat" or foe is a way to keep their own populace busy and in line.

    August 8, 2011 at 6:02 pm |
  108. Ricardo

    Eunice: This is your perception. You don't know for sure. Politics and economy are so unpredictable. Time will tell us.

    August 8, 2011 at 6:14 pm |
  109. David Dong

    US and China, they hate each other also they need each other. As long as they do have the war, that is good for the world.

    August 8, 2011 at 6:15 pm |
  110. Shrinagesh Muthuramalingam

    Chinese Government is run by a bunch of deadly hypocrites. Deadly coz they will go to any level to tarnish other's image thou not always successful as with the case of Dalai lama.US should stop pampering the Chinese or face peril.

    August 8, 2011 at 6:17 pm |
  111. Jason K

    The global economies are all set to colapse, some even have already. Make no mistake, this is the intent. When "money" is measured simply by "faith" and not "commodity" it is only worth what the two parties involved in a transaction agree upon. Right now, all parties involved in the world are trying to decide that. Eventually the juggling act will fail and all debts will be off. Western leaders will come forth with a plan to institute a one world currency. China will object of course, but if they don't play ball, they will have no one to export to.

    Enter the beginning of the end, one world government. With the loss of seperate "sovereign" nations and the consolidation of power, protection of individual and property rights will be further compromised until they are finally non existant. Thus the ultimate oligarchy will be in place with a few thousand ruling over 6.5 billion slaves.

    Soon, the only freedom and liberty will be found in death.

    Or, we could rise up and restore our republic. Take care of our own and let the rest of the world sort itself out.

    Think about it and choose wisely, but don't take too long, time is ticking away. What will you leave your children.

    August 8, 2011 at 6:18 pm |
  112. eddie2010

    No, it's a wake up call for the US.

    August 8, 2011 at 6:21 pm |
  113. Capiers

    So if much of China's wealth is trapped in U.S. dollars doesn't that make China financially dependent on our actions. We go down they go down kind of thing. I think I am starting to see the big picture. There is am evil plan in the works and the U.S. is manipulating it as always.

    August 8, 2011 at 6:26 pm |
  114. zzzzz

    Appears that everyone is in this together and if China keeps the Yuan low, nothing will change.
    Everyone, including EU, wants to weaken the USA financially, but they want the dollar to stay strong.
    That is the dilemma.
    And who ever blinks, and increases their currency value against the dollar will be the biggest looser : EU vs YUAN.

    August 8, 2011 at 6:30 pm |
  115. lance

    this is a wake up call for americans to buy only american made products. this country was better off when communist china was our cold war enemy, thank washington and greedy corporate america that woke this giant. history tells us this country did the same thing with japan before wwII.

    August 8, 2011 at 6:36 pm |
  116. Dreamer96

    Well I not sure about China, but all of the Mideast is watching how once again a small group of religous nuts are out to destory the world, only now they are a U.S. terrorist group that is called the Tea Party.

    But on the other hand;

    Here I thought the Tea Party was a bunch of crazy nut cases, but now I see they have created the first ever TIME MACHINE, and it is taking our stockmarket backwards in time, just last friday they took us back to the begining of the year, now we are going back to when they were elected..
    When will it stop, 1950, when the world was just the way they liked it???

    Thank You once again Tea Party and the Republican party...Way to go.show more

    The U.S. and China have too much at stake here to do anything but stablize this mess. China can push for the Yuan as the new world reserve, but I don't think that will pass, but it is a real wakeup call for the U.S. to get it's economy in order. The U.S. will have to raise revenue and pay down a good part of this debt quickly in 5 to ten years. A 4 or 5 trillion but sooner than 10 years, maybe 5 or 7.. From what I have found China owns about 1.6 trillion of 4.5 trillion owned outside the U.S. most U.S. debt owned by Americans at around 9.8 trillion, so China should be concerned, but is not the biggest holder of U.S. debt, Social Security, and U.S. treasury are...

    August 8, 2011 at 6:37 pm |
  117. dave

    Thank you for mentioning Chinas refusal to restructure the value of the yuan. China sounds more uncertain and afraid than Americans. They know that when things get bad in the US they will only get worse in China.

    August 8, 2011 at 6:40 pm |
  118. skeptic

    The stock market just slashed America's wealth by 30%, and if it keeps that up, we will became another Argentina. There is no up side in the foreseeable future. The best place to put your money is in China. With Chinese yuan going up 5% a year, it's safer than anything the U.S. has to offer.

    August 8, 2011 at 6:44 pm |
  119. Ruggiero

    So which country is then the biggest foreign owner of US debt?
    Saudi Arabia maybe but I still think its China. The myth isn´t a myth if not proven.
    It is true that it is in Chinas best interrest to evade the dollar as smothly as possible so that they dont evaporate their piled up fortune.
    Unfortuneatly The US is the new Japan.

    August 8, 2011 at 7:00 pm |
  120. Kuldip

    China is a corrupt and oppressive regime and should be boycotted by all

    August 8, 2011 at 7:03 pm |
  121. PEDRO MIRETE GARCIA

    Astonished as I ´ve never been before about U.S.A, I can hardly believe the news regarding ¿? supposed money difficultiesin my beloved country I ´ve never visited but allways getting the all-around information.
    In the last three or four years trough the (antenna parabólica) having a dayly shock (EN DIRECTO)
    Very difficcult for me to believe tah the actual Dollars situation is a normal developement of events (not forced) by interests (hidden)...in the caverns or (Fondo de reptiles). Esto último lo comprendería fácilmente. P. Mirete

    August 8, 2011 at 7:06 pm |
  122. tonyl

    China is rated AA- while lecturing US about putting our financial house in order. There are people living in extreme poverty in China several times over US. China manupilates it's currency to cheat the whole free world and feels justified to lecture the world about finances. With out US by China's junk in to US markets and consumers, china wold be no where.

    August 8, 2011 at 7:14 pm |
  123. Fir55

    Quote:
    An article in the Communist Party newspaper Global Times reads "The World Should Kick America's Behind".
    ------------------------------------
    Oh dear. If that happened, then who would buy all the cheap crap produced by China's factories?

    August 8, 2011 at 7:16 pm |
  124. PEDRO MIRETE GARCIA

    SORRY Gentlemen: Perhaps I had the feeling I was not being "as moderate as you like I should be"
    The times we are going trough as far as United-States is concerned, are for us in Spain so confusing that to BE moderate in or for every single statement wew have to putt in black and white is a difficcult job.
    NOTE I ´ve not even sayd ¿WHERE IS THE MONEY?
    By the way: What time and begining when I will have the pleasure to see Madame Burnett on my screen again?
    Yours. P. Mirete

    August 8, 2011 at 7:17 pm |
  125. Calvin

    Yoon, thank for your a meaningful article that ring the bell to American. Would you please check the amount of 1.16 trillion. I believe that it 25-30% US debts (means ~4 trillion as June 2011). In addition, I would point out that this country had took the advantage of free trade since Clinton era with number of exemptions. Their system is still controlled by Communist party. US credit grading downgraded is not a surprise for Amrican, who understand a little in economic and love their country. To be honest, we are surprised that it happened at this time, NOT at the end of 2010, when the CBG and debts ratio strted skyrocked. It is a shame for see the CHina government critize the US but this US president and congress should accept the mistakes, correct it and move on. Crying does not help the US out of the mud and bancruptcy, but reducing debt and reshape spending, ... does help the US economy anyway.

    August 8, 2011 at 7:22 pm |
  126. jo an

    Turn off the T V and do your own research...The TALKING HEADS...are the biggest part of the problem...

    August 8, 2011 at 7:27 pm |
  127. Leslie Schwartz

    Myth #3: A job recovery in the US is possible without changing the "free trade" policy

    Yes, this is a myth and jobs in the US will never recover unless these job killing trade deals are changed.

    Jobs and investments are being made by corporations which have trillions in cash reserves, but those jobs and those investments are not being made in the US they are being made in China, India, Asia.

    And that will not change and Americans will not get back to work until these job killing trade policies are changed.

    August 8, 2011 at 7:30 pm |
  128. GlobeTrotter101

    I agree with the author. People want to create fear by saying China owns large share of America's debt. It is the largest, but account for 8%, so not really owning America per se. People tend to forget Japan is the 2nd biggest owner of US Treasury.

    Chinese government can easily deal with its internal inflation pressure by allowing Yuan to float, which will benefit China long term and USA short term. A win-win solution.

    One lesson China can learn is don't be like USA.

    August 8, 2011 at 7:31 pm |
  129. zoglet

    Sure China needs to wake up to the US- but the outlook is still worse for the US than it is for China. China can diversify and use its position to insist on a change in the currency used on the commodities market- the US meanwhile, is stuck with the dollar and a massively weakened reputation and faces the prosepect of loosing the dollar on the commodities market- Neo-conservatisem strikes again!

    August 8, 2011 at 7:34 pm |
  130. jas495

    Hell with China!! I am applaud that we do so much business with China, I never buy anything from China, its a bunch of crap! We are so stupid, why in the hell we give our money away to other countries is beyond me! The time we stop doing business there and keep our money here, thats when we will see a upgrade. The same with all these wars!, for what? Oil? It is useless for us to keep fighting and losing our men and women for nothing. It used to be about safety, I doubt its for that anymore, since BinLaden is dead. I dont understand why we have to control every damn country in this world, why cant we consentrate on us and forget everyone else. Mind our own business!

    August 8, 2011 at 7:52 pm |
  131. bobby frank

    American's, whether they are Democratic, Republican, or Independent, should be outraged that nobody has been found guilty of the mess that we have been put in. These people that sold these toxic pills for us to swallow should be held accountable just like any other criminal. All these crooks came out smelling like a rose because the government let them get away with it. I think they all should be thrown out of office and lets start a NEW American Party for the People. Let the heads roll!

    August 8, 2011 at 7:54 pm |
  132. joelle ersther benyayer

    a group of extreme right military close nazi grou and muslims insidthe f=the french defense in var destablise the peace hide theyself in sainte maxime racoute du debdr
    arquement tdrugs trafic weapns hacking the msdulim are from holland alrfeddy do the seem in hollan close to al qaida group joelle esther benyayer

    August 8, 2011 at 7:56 pm |
  133. joelle ersther benyayer

    the french gouvernement dont contriol the cybercruwamnals in sainte maxime and var can be responsable of carckdown cmarkets watch out joelle sther benyayer we are close to cold war economic

    August 8, 2011 at 7:57 pm |
  134. sftommy

    America’s current fiscal problems stem from America’s transfer of wealth began with Reagan's FREE TRADE policies. They were great at first, but in the 1990's China began systematically exploiting weaknesses in the tenet. The result has been slowly over the lat 20 years a transfer of wealth from the USA to China. During that period China has used every tool it has to gain advantage averaging $20-30B per month in a trade deficit totally to our disadvantage. A listing of unfair trade practices on China's part would be lengthy. The benefit of this has not so much been private enterprise in China or even it's peoples as a strengthening of the Chinese government and the ruling Communist party. The conclusion seems to be that the US has been in a trade-war and hasn't acknowledged that fact. Revelations of the breadth of China's cyber-spying last week add a new potency to that trade-war. We need to start protecting our economic borders and preserving jobs and industries in the US. That means admitting we are involved with predatory trade partners, and admitting we need to defend this country economically. That means tariffs!

    August 8, 2011 at 8:05 pm |
  135. Real world

    Don't forget, China's own rating is AA-.

    August 8, 2011 at 8:11 pm |
  136. Smith

    It likes an idea from an idiot.

    August 8, 2011 at 8:11 pm |
  137. Smith

    CNN likes Cuba, also does moderation of comments.

    August 8, 2011 at 8:13 pm |
  138. BigJoeRice

    The Chinese are right; it is about time we in the USA started to learn to live within our means. even though that means we'll have less to spend buying Chines goods. I plan to live well within my means by avoiding any and everything Made in China. If that means I'll go without, well then I'll enjoy the same pleasurable feeling of sacrifice I get when I think of Opec while riding my bike to work.

    August 8, 2011 at 8:23 pm |
  139. Ellen Fix

    Cut the salaries and pension amounts of all government employees by a certain percentage, right now, and we will be able to cut U.S. expenditures tremendously without cutting jobs. Then, stop the wars in Iraq and Afghanistan now and pull the troops home immediately. This is what Americans are experiencing everywhere in the private sector – pay cuts, benefits reductions, and companies pulling in expenditures on non-essential projects requiring cash outlays that don't guarantee a sure return (i.e. conducting wars in two countries with no foreseeable goal). These are simple solutions requiring a hard-nosed boss who is willing to make the difficult decisions that will produce the greater good. Obama needs to clear his head of "can I be elected again" and "what will the party think of me" and "what would the Pentagon do" and just get down to business.

    August 8, 2011 at 9:26 pm |
  140. OneJapaneseMom

    Miss Japan?

    August 9, 2011 at 4:02 am |
  141. Olayemi Oluseun

    The wake up call for the U.S.... and China Is realy a Great burden on my Neck and Shoulder.Here comes a time when the world would have serious problem if U.S fails.Its a great revelation to tell the world not to allow the Dragon to Rule the world becos he would bring Idolatory on the world and God hates Idolatory with perfect hatred,If the Eagle allows the dragon then the world would be tormented by the Power of the UnGodly Dragon.

    August 9, 2011 at 6:29 am |
  142. Prof.Raju Gundala

    Majority of western economies need downgrade and should be below “c” or “d” and these rating agencies are waking up now because they cannot justify such ratings for those bankrupt economies in current condition... In fact countries such as India and China need much better rating than any countries on this earth. Anybody is listening? All current pseudo developed economies will be history soon and going to pay heavy price sooner or later for their addiction for over consumption of natural resources.

    August 9, 2011 at 7:09 am |
  143. nnanna

    america needs 2 sit up. D economy is in a critical state, n d earlier washington stop trivializing d issue d better it wud be for d u.s. Economy.
    China will always be happy 2 see a less stronger america...

    August 9, 2011 at 8:07 am |
  144. aw

    China very well could. If this does happen, the US can only thank our politicians in Washington for dragging their arrogant behinds and playing the political game... failing to think about the consequences!

    August 9, 2011 at 8:39 am |
  145. Olayemi Oluseun

    The only Solution I think would work for U.S.A over China Is to Use the Infinite Science to solve their Problems.Infinite Sciences is the science and Principles that helps you Get Endless Result through Abstract Principles.

    August 9, 2011 at 1:26 pm |
  146. Dan

    China's complaining over the US credit rating is a bit rich, given its own credit rating and all the reasons for it. Today routine problems for American state governors are education, taxes, business climate, state debt, revenues, expenditures, etc. A routine, top-of-agenda concern for Chinese provincial administrators to this day – despite all appearances of a stable polity – is secession. China remains held together at the point of a gun. The US is an unruly family with deep personal divisions – still voluntarily sharing the same house. China is a drug-house, held together by mutual dependence and a very strong arm.
    What's more – China's long-time credit ratings have always and continue to reflect this.
    More: davincismonkeys.com/2011/08/chinas-bad-credit

    August 9, 2011 at 3:18 pm |
  147. Scott

    US Investors will soon realize that the downgrade in credit rating has little effect on the economy. The US Fed will keep borrowing costs low to stimulate the economy. Furthermore, China will continue to buy US debt in order to keep the Yuan from appreciating to it's "true" value.

    August 9, 2011 at 6:41 pm |
  148. Waldemir Gomes Rocha da Silva

    AA+ Crisis – An immediate need to generate Jobs in a dead industry network environment

    I called the AA+ crisis to the consistent worry of USA press toward a rate that really means nothing for a normal citizen but that may create a negative thinking on how to face the new country credit status.
    I am economist for more than 35 years, and living in Brazil I faced several contradictory environment scenarios. I remember when experts used to say that inflation at 3 digits would generate a catastrophe to the country. Brazil reached those 3 digits and no tsunami came into. For several years I noticed that S&P was rating the country in an uncomfortable credit position, while we always were watching a different environment. A government status not necessarily reflects the country economy performance. Accordingly, we left those several crises by having the Brazilian people focusing in the need to work instead of keeping eyes on economic indexes and stock markets (NASDAQ, DOW JONES, ETC…) ups and downs.
    I strongly believe that it is what US citizens should focus on. However, USA is suffering a dramatic consequence of a past strategy of companies trying to increase market share by going offshore.
    People claims for the jobs creation but it is not easily possible and it may take a long time to reach employment level back.
    Why? Let’s get back to the micro economic environment. Companies started going abroad trying to find low cost labor and transferred the plants to other countries where labor or other advantages could generate lower costs for their products. Any management head was concentrated on profits and royalties. The convenience of having market growing offshore and annual profits getting repatriated, seemed to be a big deal.
    A big error I would say, because they were thinking only on the profit entry and forgot that a company is a part of the whole economy and that each cell, as they are, by thinking the same way was destroying the fundaments of the country economy.
    What? Yes labor is a fundament of the economy. Slowly, US as an economic entity was exporting the labor generators (modern plants) by transferring its companies to lower cost labor markets and started importing from abroad. The stupidity came up to the absurd of buying cheaper low quality products from China instead of the good products produced inside.
    Actually while the financial markets were strong in US, the economy could be ran, but no production was in place and two crisis plus one war absorbed much more than it had been produced into the country, if excluding services. Take a look on how many companies closed the doors and were transferred to other countries. Accordingly, what has the country to produce? Aren't the companies are closed? U.S. has great technology accumulation, good technicians but they are all around the world fixing the problems (countries with bad quality and / or low productivity levels)of their companies abroad but receiving salaries where they are not producing.
    USA has to rebuild its industry network. Start again producing cars, TVs, shoes, refrigerators, and radios at a high volume even to export. All basic consumption products to generate labor force needs are the big deal. The basis for the USA powerful economy was based on consumption goods work and not on services. The service era only allowed USA to research but the error was to eliminate the production of goods chain.
    Can you realize USA competing with China with the same products? Without the same internal problems as India and China have been faced?
    The big error of excessive capitalism mind is that economy is moved based on profits. What makes the economy grows is the working capital running fast and generating the positive inflation (prices going up due to increasing demand). This was what happened in Brazil but politicians interest, outside agencies interest and speculation, always criticized the inflation without considering the causes of it. Let us consider the automotive industry. The variable cost of each car includes profit and labor of several other companies. All this force is now outside the country. USA has to do like all the succeeding underdevelopment country did. Close the imports and start producing inside. Labor offer is at low rate and technology may help in having high productivity levels. US should not prioritize services. The country should produce consumption items that each person needs. USA quality is still respected around the world but the ambitious behavior frozen this important element for the market. US became crazy with the illusion of growing outside.

    With my respect to the US community

    August 10, 2011 at 6:03 am |
  149. Akintunde

    Are we witnessing the fall of the pioneer of capitalism in this contemporary age...The fortune amassed can dwindle if sustainability checks are not put in place, financial fair play has not been the watch word of Americas' transaction with the rest of the world...The downturn is obvious and the time ficticious figures are over...America can get over the debt only if it is willing to imbibe political fair play...

    August 11, 2011 at 5:33 pm |
  150. Somebody

    I run sims about the world and it is not lookin good. If something crazy happens it won't hurt the States much but every where else. Lets say the World pushes the States out of contries and Iran doing things in the backround as well if china is.. States gets push goes in a doriment state for only themselves stays on the other side of the world. China over time may break up into small places due to lack of resources and other things another like group will rise hard to say what but not good. The new country/governemnt out of China will rise to power. First person that will get aim at would be Iran of course all the other small countries around it. why Iran becuase they would be Chinas most threat and any other country that does not follow the new government would go down.. They would leave the states to itself and Iran would ask for help. Like I said Grass is not green on the other side u cant always change it back to. This could happen in many years to come.

    August 16, 2011 at 2:12 am |
  151. Oz

    It must really hurt to know that 'those dirty communists 'are the only thing stopping the world economy from complete collapse.Just ask the EU....Who are they turning to for a bail out?Certainly not the Americans,because there is no money left,if you discount the overworked printing presses.

    November 17, 2011 at 6:30 am |
  152. AC.Linn

    Could the U.S. fight off a surprise attack by a land-force of 4,585,000 (active, reserve and paramilitary) Red Chinese militia? If you are an American Christian. Visit this site, see: http://faluninfo.net/ and never buy a single item made in Red China again!

    December 29, 2011 at 10:58 am |
  153. josh murphy

    What the American people should do is go to our local congressman to purpose a trade embargo against china banning imports and exports. For example in India an trade embargo was placed against china since then there at an 8.2 growth rate (2011). Theres many more things we can do like make laws to restrict trading ECONOMIC MINIPULATING COUNTRYS. We can make an 10 year plan wear we build industrial capacity and improve job growth. Cut taxes on corperations and raise minumwage. More money for americans to spend, spent products go to mostly american made products as you think. Maybe even more. Preparing incase the dollar collapses, such as make gold currency, send them to baks if the dollar fails switch money for gold coins. Its predicted in 2016 China will be the worlds biggest economy. America needs to take action. China and the united states are on the rad to the next cold war or maybe WW3

    April 30, 2012 at 9:05 pm |

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