Slow Steady Destruction of Our Dollar: The Printing Press Works Overtime

China alarmed by US money printing – Telegraph:

“China’s task is to switch from export dependency to internal consumption, but that requires a ‘change in the ideology of the Chinese people’ to discourage excess saving. ‘This is very difficult’.

Mr Cheng said the root cause of global imbalances is spending patterns in US (and UK) and China.

‘The US spends tomorrow’s money today,’ he said. ‘We Chinese spend today’s money tomorrow. That’s why we have this financial crisis.’
Yet the consequences are not symmetric.

‘He who goes borrowing, goes sorrowing,’ said Mr Cheng. It was a quote from US founding father Benjamin Franklin.”

Cheng Siwei, former vice-chairman of the Standing Committee and now head of China’s green energy drive, said Beijing was dismayed by the Fed’s recourse to “credit easing”.

“If they keep printing money to buy bonds it will lead to inflation, and after a year or two the dollar will fall hard. Most of our foreign reserves are in US bonds and this is very difficult to change, so we will diversify incremental reserves into euros, yen, and other currencies,” he said.

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