China and the U.S. talked for 2 days, China added another 11.9 billion U.S. debt

The U.S.-China Financial Working Group has been talking in Shanghai for 2 days, and the Biden administration clearly wants to “borrow money” from China, and has already taken 3 consecutive steps back from China before sending people to China. At the same time, at this critical moment, a piece of news came, China again increased its holdings of U.S. debt by 11.9 billion. Why is the Biden administration trying to “borrow money” from China? The U.S. side to China and actually even backed up which 3 steps?

According to several media reports, August 15 to 16, the U.S.-China Financial Working Group held two consecutive days of meetings in Shanghai. This is since last September, the United States and China respectively set up “economic working group” and “financial working group” since the fifth meeting between the two sides. A spokesman for the U.S. Department of the Treasury on this matter is a clear statement that the meeting will focus on macroeconomics, financial stability, governance of the International Monetary Fund and capital market issues and other topics.

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It is important to know that, although last November, Chinese leaders met with U.S. President Joe Biden in San Francisco, China and the United States in the general direction of the relationship between the two countries have eased and improved; but in recent times, China and the United States in a number of areas of greater differences, economic and trade relations are still relatively tense. One of the most typical things is that the U.S. side once again announced new tariffs on a series of Chinese imports, including electric cars, solar cells, semiconductors, etc., despite China's strong protests and resolute opposition. It is precisely for this reason that, at the current critical moment of continued tensions in the economic and trade relations between China and the United States, the U.S. side directly sent people to Shanghai to meet with the Chinese side, and the U.S. and China in the end to reach what kind of consensus, which is also quite attention-grabbing.

And another important content of concern, probably is the U.S. debt problem, some experts analyzed that the Biden government sent people to China to interview, but also a clear desire to the Chinese side of the “borrow money” meaning. To know, by now, the size of the U.S. debt has exceeded 35 trillion. The U.S. Peter Peterson Foundation not long ago for this matter, claimed that if these huge debts are apportioned to the U.S. population, it means that each person is indebted to nearly 104,000 U.S. dollars, and each family is indebted to more than 260,000 U.S. dollars. If the U.S. government is unable to effectively alleviate this situation, then once the U.S. debt exceeds the ceiling, the impact on the U.S. economy will be incalculable.

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China as the world's second largest economy, but also holds a large U.S. debt creditor countries, the Biden government will focus on China, seeking to strengthen economic and trade cooperation with the Chinese side, which is naturally not surprising. It is precisely for this reason that before sending people to visit China, the U.S. side has actually taken 3 consecutive steps back towards China. The first step is that, at the end of July, the United States publicly announced that it would delay the imposition of tariffs on Chinese imports. The 2nd step is that, a few days ago, the U.S. Department of Defense announced that Chinese LiDAR manufacturer - WoSai Technology will be removed from the U.S. Department of Defense blacklist. Step 3 is that, recently, U.S. Senator Alex Padilla, a Democrat, and Representative Zoe Lofgren sent a letter to the U.S. Department of Commerce requesting that the U.S. suspend additional unilateral export controls on China.

Meanwhile, just at such a critical moment, a piece of news came out that China has increased its holdings of U.S. debt by another 11.9 billion dollars. It is reported that on August 15, local time, the U.S. Treasury Department released its latest report on international capital flows. According to the report's data, throughout June, the top three overseas debtors of U.S. debt are Japan, China and the United Kingdom. Among them, the first major debtor Japan reduced its holdings of U.S. Treasuries by $10.6 billion, and its current position stands at $1,117.7 billion. The second largest debtor, China, increased its holdings by $11.9 billion, and its current position is $780.2 billion. The third-largest debtor, the United Kingdom, also increased its holdings by $18.1 billion, and the current size of its position is $741.5 billion.

Image Source: Sourced from the Internet

According to relevant data, in the first five months of 2024, in addition to a small increase in China's holdings of 3.3 billion U.S. debt in April, the other four are all reduced, and the size of the reduction is not small, such as in March when the holdings of up to 22.7 billion U.S. dollars. And in June, the Chinese side began to increase its holdings of $11.9 billion in U.S. debt, it seems that the Biden administration wants to borrow money, and the Chinese side is also finally a promise.