Chinese Think Tank Implies America May Be Falsifying Its Accounting, Says US On Way To Default

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Zero Hedge
Aug 22, 2011

Joe Biden came to China, saw, and failed to conquer the locals’ ridicule. Punctuating just how “effective” Biden’s visit to China was in order to “reassure that the US is solvent” (no seriously, that;s the name of the article) is a just released article in the Securities Times by Wang Tialong, member of Chinese think tank Center for International Economic Exchanges in which he went on to blatantly say that “The U.S. may be on its way to default on its debt despite the U.S. government’s ability to print more money, a Chinese think tank researcher said Monday.” Now this is nothing new in the escalating war of words between the two countries, although increasingly China appears to be attacking the primary loophole that defenders of the unsustainable US debt use, namely the fall back to the USD as a reserve currency. Wang went on further to implicitly accuse the US of fabricating economic data: “There is also no way to punish the issuer country if it falsifies its accounting and there is no way to restructure the issuer either, Wang said.” Well, when China accuses the US of “falsifying accounting” you know you have hit rock bottom.

From Dow Jones:

The U.S. may be on its way to default on its debt despite the U.S. government’s ability to print more money, a Chinese think tank researcher said Monday.

 

There is no guarantee for sovereign debt, which increases the risks the lenders face, said Wang Tianlong, a researcher at the China Center for International Economic Exchanges, a think tank supervised by the country’s economic planner, adding that the issuer could be more careless in using the loans.

 

In the short term, the U.S. doesn’t have much ability to reduce its deficit, Wang said in an opinion piece published in Securities Times. He added that the U.S. lacks the political system to guarantee that it will not default on its debt.

 

There is also no way to punish the issuer country if it falsifies its accounting and there is no way to restructure the issuer either, Wang said.

 

Wang’s comments come after the U.S. Vice President Joe Biden said Sunday the U.S. “never will default” on its government debt and reassured Beijing that Chinese investments in the U.S. are safe.

Slowly, surely, China is realizing that the endgame is nothing short of out of control debt inflation, which is precisely what having no way to “restructure the issuer” means. That plus sending the US to bankruptcy court may be somewhat problematic. It also means that Chinese holdings of US debt will be increasingly worthless, and its population increasingly stabby as the price of hogs resumes its record climb. The only alternative is for the CNY to float and for the Chinese, Russians and Germans to say enough to this broken economic model and launch a gold (and other hard asset) backed currency. The only question is when.

h/t London Dude Trader

 


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4 Responses to “Chinese Think Tank Implies America May Be Falsifying Its Accounting, Says US On Way To Default”

  1. AMERICA GOING BANKRUPT! Economic Collapse – Imminent Global Financial Crisis and U.S. Dollar Collapse!
    BUT I’LL SHOW YOU HOW I MADE A 418% RETURN Using The Black-Box Investment Strategies Of The Rich.

    There are 3 Steps you need to take action right now to protect yourself and your love ones

    (click on my profile name to go to my blog to see my full video)

    Glen Reply:
    August 22nd, 2011 at 5:43 am

    SCAM – SPAM – SCAM – SPAM – SCAM – SPAM

  2. MAY…..MAY be “Falsifying Its Accounting” Bwa Ha Ha Ha Ha Ha Ha

    NO SHIT SHERLOCK

    EVERY number they say is designed to hide that ONE TRUTH.

    America the BANKRUPT.

    Home of the PUSSIES and the CORRUPT

    A few more lies from the END.

  3. Yep BANKRUPT,PUSSIES,CORRUPT is absolutely CORRECT. With emphasis on PUSSIES.

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