[nigerian1981]

As the largest holder of US foreign debt China could call in that debt.

[zrail]

I'm sure it's been explored before, but that's not how it works. If China started dumping their Treasuries lead to significant domestic inflation, which they definitely don't want.

Also, minor point, Japan holds more Treasuries than China.

https://www.investopedia.com/articles/investing/040115/reaso...

[timerol]

That's not how US debt works. It pays back on a schedule. China could stop buying new US debt, and will continue to receive payments on US debt it owns, but China can't call up the US and demand full repayment immediately.

[chihuahua]

They can call and demand full repayment, but the only response would be laughter.

[MagicMoonlight]

They can’t because this isn’t make-believe world where there’s some sort of world police enforcing nonsense.

If someone tries to destroy your country you just say no. “Sorry china, we aren’t paying lmao”

And then they can’t do shit. Then you embargo them for being aggressive and destroy their country.

[MattGaiser]

Not how debt of virtually any kind works except from the mafia. Very few debts can be arbitrarily called.

[bequanna]

That isn’t how debt works.

They could sell the debt that they currently hold, sure. The response would likely be a short term rise in interest rates followed by the Fed simply intervening and purchasing Treasurys.

[balls187]

Japan owns more US debt than China does. [1]

1. https://www.thebalancemoney.com/who-owns-the-u-s-national-de...

[JumpCrisscross]

> China could call in that debt

And we could sanction the PBoC and freeze the accounts into which we repay the debt they hold. The China-owns-our-debt line ignores the realities of sovereign debt.