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Q: How will China's economic crash affect the world?
China says it will simply recall loans it has made to poorer nations that can't afford to repay; some nations have already stated they won't pay. It also plans to call in foreign reserves, which would affect the economies of the countries China has it's money in.
But what if other countries simply freeze those reserves to protect their own economy? This could be quite simple by suing China for breach of WTO regulations or something similar, and freezing assets until the matters are decided.
In the case of USA, It is rumoured that the government has already determined that China owes almost $1 trillion dollars from unpaid war bonds (plus interest) dating back to the 1930s.
So could the rest of the world cover itself by "changing the rules" just as China constantly does?
10 years 37 weeks ago in Money & Banking - China
a fire sale of assets at 50 percent to raise reserves, seemed to remember the japanese doing this in the late 80's, history repeating itself again,
japanese company bought rockefeller center for 900 million plus and sold 550 million 5 years later.
trying to sell into a down economy to raise capital, sounds like a plan to chaos, wonder if this was planned for china all along, as it was for japan,
playing monopoly with a house bank that makes the rules is never smart and if nobody trust your numbers or actions, the game will eventually be rigged against you., but china is so clever, im sure it want happen to them.
It would be nice scenario. Really.
They can recall, but if some countries refuse or will be unable to repay, what they can do ? Send the army ? Send the Lawyers and treat them to pay in cash by each single citizen ? Or what else ?
I can tell you, what will happen.
In the time of collapse of Chinese economy, the most involved will be already enjoy their Long Island drink on Florida beach, and those stucked in the China, ehm, you know .. .
Or, They will begging us for sending the food to them, because you know, they can not supply themself, as other way of repayment the dept. Just keep them one year ... There will be someone jumping and screaming like Mr. Kim in N.K.
... barking dogs never bite ...
