By James McKee
Europe has been experiencing a great deal of trouble financially despite having taken austerity measures upon itself, and this has resulted in a drop of the value of the Euro against the USD on the online forex exchange. The European economy at large needs a good deal of help, and to date that help has come from European nations helping one another. The United States is not in a position to lend money and most other nations are in the same spot, it seems like everyone is broke…but not China. China is flush with cash due to a symbiotic trading relationship with the United States, and while China is no longer looking to buy as much debt from the US they are looking for other investments. Since Europe is closer to China geographically than the US it makes more sense to keep that region as stable as possible.
It has long been known to China that the United States would rather crawl ever deeper into debt than pay off their debts to China and others. This continual cycle of debt and more debt has caused the US economy and USD to slump against those else where in the world. Such a scenario has remained on the horizon for the United States for some time now and in all likelihood there is going to be no shortage of excuses; however, China it seems has heard enough. The voiced interest on the part of China in buying European debt was enough to cause the Euro to bounce back against the US dollar. While this is all well and good for Europe a shift in China’s economic interests could spell out serious trouble for the USD in the short and long term.
This all spells out trouble overall for the USD on the online forex exchange and more than likely there is going to be a grab for Chinese money. In order to begin paying off its debts the United States needs to make a TRUE effort to do well by its investors and walk the walk. The time for talking has been over for a long time now and austerity measures are the least of what the United States must do to make things right with China and other investors…there has to be change and it must come now. China and the rest of the world have heard enough excuses and are beginning to turn their focus elsewhere.
About the Author
Author is a Forex trader and financial analyst residing in Denver, Colorado. To stay up to date on all the latest developments in the financial world and beyond be sure to check out the online forex trading regularly.
