The U.S. Congress, with bipartisan support, is considering legislation that could reduce the flow of funds into the U.S. bond market, cut financing for the War on Terror and support for the real estate market, increase long-term interest rates, and slow economic growth.

The purpose of this proposed legislation is to eliminate the trade deficit with China.

The U.S. Constitution gives Congress the prerogative to regulate international commerce,

About 25% of the trade deficit relates to the China trade.

(See: “Is The U.S. Trade Deficit Sustainable?“)

Funds originating from the trade deficit are a major source of financing for the U.S. bond market.

(See: “U.S. Bond Demand Has Exceeded Supply for a Decade“)

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