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Originally Posted by Cruisingdad
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Not to worry CD, despite Danjarch's warning, the Chinese aren't stupid. At least they're not as dim as the author of that Yahoo article.
China is somewhat enslaved by our debt. As long as their economy is export based they can't stop buying or even sell our debt. If they were to sell all of its U.S. Treasury bonds, it would mean China is converting most, if not all, of its dollars into their own currency.
China's economy would tank overnight. While the country would sell off all of its dollar reserves, thus tanking the dollar, this would in effect increase the value of the yuan at the same time — which means they shoot themselves in both feet as fewer nations would be able to afford Chinese exported goods — including the United States.
In short, it never pays to bankrupt your best customer. So, they can take the hit on tires. As for a trade war? What the hell do they buy besides chicken?
Let them jump up and down or learn to play by the rules they agreed to. Not to worry .....yet.