Recession and debt

  The reason some people call for austerity measures is not because it would improve the economy. It is meant to tighten a nation's belt and help pay off previous debt. If anything, a strong economy would only further the national debt as imports exceed exports and a weak economy would help bridge that gap as consumers have less income to spend. 

  Austerity is no more fun for the country than it is for the individual. After all, how is using 25 percent of one's income to pay off debt be considered better off? Indentured servants are simply semi-slaves.

  The us economy saw its trade deficit decline from 800 billion to 400 billion a year as a result of the recession. This meant the united states was exporting 400 billion less in fiat dollars to pay for foreign goods and services. For countries doing trade with the us, that is a considerable loss in expected liquidity. However, liquidity can always be substituted with more liquidity. Thus if one nation is no longer exporting paper money, another nation can easily make up for the difference by printing their own.

A statement on the government's website said the State Council had approved a plan to invest 4 trillion yuaninfrastructure and social welfare by the end of 2010.^[4][3]

Chinese banking officials were reportedly considering establishing a fund worth between 600 billion and 800 billion yuan to purchase domestic shares listed on the Shanghai Stock Exchange, particularly those in the Shanghai Composite, in the event the Shanghai Index fell to 1,500 points.^[9]

Public infrastructure development took up the biggest portion -- 1.5-trillion yuan, or nearly 38% of the total package. The projects lined up include railway, road, irrigation, and airport construction.

China's economic growth was sustained by the economic stimulus and in addition, assisted neighboring countries with the economic recovery in 2010.^[12] Chinese economic growth was around 10 percent even as its European and north American economies were slowing. ^[13] The stimulus provided funds for infrastructure projects and housing developments. Some were used to assist local governments to lend money to state-owned companies to develop housing estates, roads and bridges. ^[13] This will drive employment in areas of manufacturing, steel, cement and other sectors of the economy. ^[13][14]

  As stated before, the markets only care about liquidity. They want to see monetary expansion because it makes them see profit. And for consumers, it means economic growth since it triggers businesses to expand. China's economy still grew 10 percent even as trade with the united states fell. Because the Chinese economy does not need american dollars, it simply needs liquidity whether it is RMB, Yen, Rand, Rubles, or shellfish and glass beads.