The progressive issue many progressives don't seem to like

[jeff47]

49. They don't anymore

They used to buy treasuries as you describe.

The problem they ran into is it requires exponential growth in the amount of treasuries you buy, and it just became too much money.

Why are they doing this? I have no idea

China's economy is based on selling us cheap crap. The problem is that improved China's economy and hurt ours.

In a world without government intervention, the Yuan would go up relative to the Dollar. That would make their cheap crap no longer cheap - and so we'd stop buying it. Their political stability is based on about 3-6% economic growth every year. So this would not be a small problem for China - the peasants, no matter what country, get upity when they're starving.

So they bought treasuries to inflate the Dollar relative to the Yuan. The problem is this can't go on forever. They're trying to make a river flow uphill, and the more water you put at the top of the hill, the bigger the bucket you need to use to move the water.

So they gave up. They've been trying to play games with currency pegs, but that isn't as effective and far more problematic in international politics. The result? Business magazines talking about "re-shoring" jobs back to the US....and others looking for the next country with cheap labor that could be exploited.