China’s president Wen Jiabao admits he’s “definitely worried” that the banana republic known as the United States will default on its debt. And it probably will–although not in the way Wen fears.
The U.S. will likely default by triggering hyper-inflation, obliterating the value of the $1 trillion that the U.S. owes China. This tactic will also obliterate U.S. citizens who have been dumb enough to save money, of course, but better that (from the government’s perspective) than drowning voters in mountains of debt.
NYT: “President Obama and his new government have adopted a series of measures to deal with the financial crisis. We have expectations as to the effects of these measures,” Mr. Wen said. “We have lent a huge amount of money to the U.S. Of course we are concerned about the safety of our assets. To be honest, I am definitely a little worried.”
He called on the United States to “maintain its good credit, to honour its promises and to guarantee the safety of China’s assets.”
Good luck, fella.
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