please specify the source as i have to submit the article.
2007-12-06 08:28:25 · 2 answers · asked by rob 2 in Social Science ➔ Economics
The interest rate on US Government bonds and therefore all US loans which, varies with Government bond rates, would increase until enough investors would choose to buy the bonds. Some of the needed money would be from money that is now used for investment in the US so investment would slow down.
The financial markets are Global so as China invested in other countries some money that is now invested there would move to the US which would dampen the effect. The US government might even decide to balance the budget.
2007-12-06 09:14:38 · answer #1 · answered by meg 7 · 0⤊ 0⤋
It would be real bad for US -- low investment, rapid decline in dollar, economic depression, possibly a banking crisis.
Source is my own head plus years of education.
2007-12-06 16:35:55 · answer #2 · answered by Anonymous · 0⤊ 1⤋