Bush Boom, We Harldy Knew Ye

From Holden:

The Bush Economy reaches its Oh Shit moment as China decides it no longer wishes to finance our debt.

China has resolved to shift some of its foreign exchange reserves — now in excess of $800 billion — away from the U.S. dollar and into other world currencies in a move likely to push down the value of the greenback, a high-level state economist who advises the nation’s economic policymakers said in an interview Monday.

As China’s manufacturing industries flood the world with cheap goods, the Chinese central bank has invested roughly three-fourths of its growing foreign currency reserves in U.S. Treasury bills and other dollar-denominated assets. The new policy reflects China’s fears that too much of its savings is tied up in the dollar, a currency widely expected to drop in value as the U.S. trade and fiscal deficits climb.