China Losing Taste for Debt From U.S. (Published 2009)

HONG KONG — China has bought more than $1 trillion of American debt, but as the global downturn has intensified, Beijing is starting to keep more of its money at home, a move that could have painful effects for American borrowers. The declining Chinese appetite for United States debt, apparent in a series of hints from Chinese policy makers over the last two weeks, with official statistics due for

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"China has bankrolled its..reserves by..requiring..banking sector, which is state-controlled, to take nearly 1/5 of deposits and hand them to the central bank, (which) has used the money to buy foreign bonds. Now it is rapidly reducing this requirement and pushing banks to lend more money in China"