Why does China's massive purchase of US Treasury bonds have such a great impact on the United States?
China uses foreign exchange to purchase US Treasury bonds through the US Treasury or securities institutions; Buying US Treasury bonds is good for both China and the United States. China enterprises earn a lot of dollars through export processing. These dollars are deposited in banks in China, and banks pay interest to depositors every day. So take these dollars to the United States to buy U.S. Treasury bonds, and then we can charge interest on the dollars and bring the interest received back to depositors. To put it bluntly, it is to preserve and increase value; Similarly, when the United States sells our national debt, they get dollars. After the United States gets these dollars, they can buy processed and manufactured things from us. Many goods in the American market are made in China! This is beneficial to both sides. Besides, the credit of US Treasury bonds is very good, and the United States is a superpower, and its military, science and technology and finance are the first, so it is safest to buy US Treasury bonds, and it is impossible to buy Iraqi Treasury bonds!