China's $2 trillion dollar problem.
Everyone knows China has been funding U.S. deficits. We buy a lot of stuff from China in doing so China lends us a lot of money. They currently hold $2 trillion in U.S. government bonds. Why this matters? Well, its a lot and they need the dollar and the U.S. economy to stay strong. If the dollar decreases in value (say 20%) the value of those bonds will decline by 20% (that's a big loss). China needs the U.S. economy to stabilize and for American's to keep purchasing Chinese goods and services.
It’s really important thing to be aware of all these news since that can really help us trade better and allows us to be successful. Right now I am working with OctaFX broker where there is lovely daily market updates provided and it’s for almost every currency pair, commodities and indices, so that really help anyone work easily according to his strength and allows one to be fairly successful really easily without much trouble or difficulty at all in any situation.
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