'Fast-growing risk to China: Holding $1.2 trillion of US debt'

from economic times of india....

"Timothy Geithner says borrowing more from China to finance tax cuts for the most affluent Americans would be irresponsible. The Treasury secretary has it backward. The real question is whether Beijing is willing to double down on a nation whose balance sheet makes Italy look good. Holding $1.2 trillion of US debt is a fast-growing risk to China. 

Traders have a theory about why the euro is reasonably stable amid a broadening debt crisis: Asian central banks are converting proceeds from recent intervention moves into other currencies. "Asian central banks" has become a euphemism for China, whose reserves now exceed $3 trillion. China is making deals with nations such as Brazil to conduct trade in yuan. It's also making noises about the Federal Reserve's zero interest-rate policies and Congress playing games with the debt limit. If you were managing China's reserves, how many more dollars would you really want in this environment?"................read it here