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Published On: Mon, Oct 7th, 2013

China to US: don’t default on Treasury Bonds, it’s important for the global economy

The US government shutdown rolls on and Monday the Chinese authorities spoke out, saying the “clock is ticking,” referring to the October 17 deadline to increase the nation’s debt limit or risk default.

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China, the United States’ largest creditor, is “naturally concerned about developments in the U.S. fiscal cliff,” vice finance minister Zhu Guangyao told the BBC.

“The executive branch of the U.S. government has to take decisive and credible steps to avoid a default on its Treasury bonds,” he said, referring to President Obama.

“It is important for the U.S. economy as well as the global economy.”

“We hope the United States fully understands the lessons of history,” Mr. Zhu said, referring to a similar deadlock in 2011 that led to a downgrade of the U.S. “AAA” credit rating.

The White House signaled on Monday that it would be open to a short-term hike in the nation’s borrowing authority as the United States moved a step closer to its first-ever default and a partial government shutdown entered its second week.

Gene Sperling, a senior Obama economic adviser, was pressed on whether he would rule out a two- or three-week extension on increasing the nation’s $16.7 trillion debt limit. Treasury Secretary Jack Lew has warned that on Oct. 17, he exhausts the bookkeeping maneuvers he has been using to keep borrowing.

“There’s no question that the longer the debt limit is extended, the greater economic certainty there will be in our economy which would be better for jobs, growth and investment,” Sperling told a breakfast sponsored by the newspaper Politico. “That said, it is the responsibility of Congress to decide how long and how often they want to vote on doing that.”

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About the Author

- Writer and Co-Founder of The Global Dispatch, Brandon has been covering news, offering commentary for years, beginning professionally in 2003 on Crazed Fanboy before expanding into other blogs and sites. Appearing on several radio shows, Brandon has hosted Dispatch Radio, written his first novel (The Rise of the Templar) and completed the three years Global University program in Ministerial Studies to be a pastor. To Contact Brandon email [email protected] ATTN: BRANDON

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