Reply To: US-China Trade Relations


Freer trade allows people to extend the division of labor which raises productivity and standards of living overall. Tremendous wealth has been created by market reforms in China.

The Chinese have been buying American assets and claims to assets. Like any investment, if they earn a rate of return, they will be better off. If they buy physical assets in the U.S. or hold bonds and stocks of private companies, then they will be paid back. Of course, the Federal government may default on Chinese held Treasuries, in which case expect the Chinese government to retaliate in some manner.

Here is a list of foreign holders of U.S. Treasuries:

Here’s a list of foreign holdings of U.S. assets:

Here’s a list of Chinese holdings:’s%20FX%20Reserves%20and%20Treasury%20Holdings.pdf