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Analysis: What is Plan B if China dumps its U.S. debt?

01-19-2011 • Reuters

When borrowing money it's always good to have a Plan B in case a big creditor pulls the plug. That should be true whether the sum is a few thousand dollars or about a trillion, the size of the United States government's debt to China.

With Chinese President Hu Jintao due to arrive in Washington on Tuesday, it is worth asking about U.S. officials' Plan B just in case one day relations take a surprise turn for the worse and Beijing dumps its holdings of U.S. treasuries.

1 Comments in Response to Analysis: What is Plan B if China dumps its U.S. debt?

Comment by Olde Reb

Entered on: 1/20/2011 7:44:58 AM

I believe the T-securities held by foreign nations are, in greater part, a form that can only be sold to the U.S. government. If China wants to sell too many too fast, the US government could repudiate the debt ??

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