China calls US debt deal immoral

The risk of America's possible default has echoed throughout the world with global stocks rallying following the House vote. But despite the immediate economic relief, more voices calling to replace the dollar as the world currency are being heard.

­World markets in Asia are rallying, buoyed by the deal finally passing. Many leaders are shocked at how little time it took for the US to pass the deal. Chinese newspapers are calling the entire US debt deal debate “irresponsible” and “immoral”. So although people are celebrating, there is a lot of cautious optimism in Asia. People do not want to jump the gun as they are worried things are not finalized yet.

Asia has a huge vested interest in what is going on in the United States. $3 trillion of US debt is held by Asian countries, primarily China and Japan. Confidence has gone down in Asia. Another thing that worries people in Asia is whether or not $2.4 trillion that is slated to be cut from US spending has become another sort of a political game in Washington.

Many critics of the US deal worldwide are saying that it is not going to help American unemployment in any way, which directly impacts the Asian economy as well. Asia is the manufacturing center of the world, so if the unemployment problem is not solved in the US that also means that consumer confidence goes down for America. And that in its turn means they are not going to be buying exports from Asia, which can really impact on jobs.

There also has been much talk in Asia about an alternative reserve currency or looking into a basket currency, including Japan and China as well.