The US Debt Crisis Will Give China A Massive Boost

When Nixon was president many years ago he probably would not have predicted what was happening in the great country of America right now. With the economy in tatters, the Federal reserve taking matters into their own hands, and a very poor fiscal policy Nixon would not be proud to see what is happening right now in the great country of America.

The amount of debt that now circulates America is is enormous. The debt has now accumulated and is now out of control. But as the American economy starts to falter is this really bad for countries like China. Over the last several years China has not been engrossing themselves in debt, and they are known for their healthy saving tactics, with around $1.2 trillion worth of U.S. debt.

China is one of the world’s largest creditors and having so much of the U.S. debt it has every right and demand the U.S. to fix it’s structural debt problems to make sure China’s future is safe. Since the downgrade of the U.S. China now realises how much of a head start it now has for the coming several years. A shift in power is coming for China depending on how well the U.S. can manage its current debt levels, and also work out a strategic plan to fix up these issues promptly.

If the U.S. fails to fix up the is debt levels, it will have dramatic effects on the economy and also the public, who are already angry at the government officials and Obama for his weak leadership over the last several months.

The worry right now is China thinks the U.S. will collapse. But in a way that is bad because China owns a lot of the U.S. and this will affect them in the short term, and also in the grander scale of things. Even though China realises it now has the upper hand, if they are to take over the superpower role of the American empire, it will not happen for several years. You cannot just take a superpower role instantly, it takes time and it is not a simple process.

Right now China is upstaging the U.S. is the biggest consumer of many commodities, construction and also infrastructure to investment booms. It has become less reliant on other global superpowers even though it has its own in house problems right now. But if America continues down its long debt ridden Path, China will start to take the upper hand in the next 12 to 24 months. By then if the U.S. has not taken care of its debts and also government problems China will become the new U.S.

Source by Jon Safer