Friday, September 11, 2009
At first, the headline for the report excerpted below looked like some kind of a funny typo or maybe even an April Fool's joke that comes seven months early. But, upon further inspection, it is not the U.S. Dollar that is concerned about demand for U.S. debt (though it should be), but economist David Dollar, who toils away at the Treasury Department.
U.S. Concerned on Debt Demand, Treasury’s Dollar SaysMr. Dollar's optimism regarding future U.S. budget deficits may ultimately prove to be unfounded (see, even that sounded like some kind of joke). Don't be surprised if they have to trot Mr. Dollar out repeatedly to assure the Chinese that their investments are safe.
Sept. 11 (Bloomberg) -- The U.S. government is concerned about overall demand for Treasuries, not appetite from individual countries, said David Dollar, the U.S. Treasury Department’s economic and financial emissary to China.
“The interest rate on long-term treasury bonds is at a very low level by historical standards,” Dollar said today at the World Economic Forum meeting in Dalian, China. “That says that the market has confidence the U.S. will get the fiscal problem under control.”
In an interview with Bloomberg Television, Dollar said that countries still favored holding reserves in dollars because of the breadth of the U.S. market.
“The U.S. dollar happens to be the best choice,” Dollar said. “It is one of the few very good places where you can put large amounts of assets and have confidence of their future value.”