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China’s Holdings of U.S. Securities: Implications for the U.S. Economy

Wayne M. Morrison, Marc Labonte

China’s Holdings of U.S. Securities: Implications for the U.S. Economy

Given its relatively low savings rate, the U.S. economy depends heavily on foreign capital inflows from countries with high savings rates (such as China) to meet its domestic investment needs and to fund the federal budget deficit. The willingness of foreigners to invest in the U.S. economy and...