Bank Of China Official: The World Is Running Out Of Money To Buy
Zhu Min, deputy governor of the People's Bank of China has issued a stark warning to President Obama and Treasury Secretary Tim Geithner. China's appetite for United States Treasuries is rapidly declining.
China believes it is getting harder for governments to buy United States Treasuries because the US's shrinking current-account gap is reducing supply of dollars overseas. This view was echoed by Zhu Min, a Chinese central bank official said yesterday.
In a discussion on the global role of the dollar, Zhu told an academic audience that it was inevitable that the dollar would continue to fall in value because Washington continued to issue more Treasuries to finance its deficit spending.
"The United States cannot force foreign governments to increase their holdings of Treasuries," Zhu said, according to an audio recording of his remarks. "Double the holdings? It is definitely impossible."
Read more: at Shanghai Daily