lowering demand for us paper means higher interest rates. higher interest rates in the us means devaluation of foreign (non us currency), all other things equal.
us is going to slow gdp when interest rates go up (look at fed...they are scared). so this is basically a stealth currency deval and a shot accross the bow to obama (sitting admin will take the hit if gdp in us goes south).
typically, this is crytpic and below the radar type of stuff but almost certainly is meant to broadcast a message.
I don't think China has much of a choice to be honest. They're still not able to get a Chinese middle class to buy goods made at home at the rate they want. So, I think their economic program of being the world's factory floor has been a failure so far. They (Chinese Community Party) really need to rethink their strategy and look towards other methods of improving the living standard because it just doesn't look like their brand of market socialism is working (I'm using the term market social very loosely here).
It's more of an observation in regards to what seems to be the CCP's end goal of lifting all of China's people out of poverty. It's been sacrificing services like healthcare and education to get their economy up and running, but it seems to only benefits only a few of China's citizens. So, I just wonder if the CCP has given up on the goal of socialism to communism.
