government to borrow billions?

[burbie]

On tonights evening news it stated that the Goverment is to borrow billions of pounds.
Where are they borrowing this money from?

[Buenchico]

Governments borrow money by selling bonds. Since bonds can be traded, they can end up anywhere in the world. In practice, they'll almost certainly end up where most of the US bonds are - in China. (China could bankrupt the USA overnight if the Chinese government decided to cash in all of their US bonds. They won't do so because the knock-on effects would also cripple the Chinese economy).

Chris

[stokemaveric]

well if thats the the case,if british govt bonds DO end up in china,couldnt the chinese bankrupt the british economy?i guess they could as the knock on effect would not be as bad as if they bankrupted the u.s.........after all what do WE export to china????

[VHG]

>couldnt the chinese bankrupt the british economy?

I thought Gordon Brown had already managed to do that?

[jno]

stokemaveric, the question is more what we import from China - it'd damage their economy if we weren't buying millions of knickers etc assembled there.

[B00]

The mind boggles jno- what kinda underwear do you wear if they have to be assembled? gulp

;-)

[jno]

I'm flattered to have you inquiring about my underwear, B00 - you work on one of those, ahem, telephone services for gentlemen, do you? - but yes, my knickers aren't actually made all in one piece, there are several pieces of silk that have to be sewn together and then there's the pearl edging...