The Chinese government has begun a concerted campaign of economic threats against the United States, hinting that it may liquidate its vast holding of US treasuries if Washington imposes trade sanctions to force a yuan revaluation.
In light of this quote it's probably a bit inflammatory to title the thread "China threatens..."

China is making the point that it could retaliate, if necessary. It has been known for years that China owns most of the US govt's debt, though I don't really understand how or why the US allowed such a situation to arise. Of course, living off credit whilst earning less than you're spending might cover the cracks for a while, but it doesn't alter the facts that your economy is screwed. So long as the public see new Chevvies in the drive and have full tanks why worry about the way the economy's going?

The article certainly makes it look as though the US is vulnerable on this one, but I quite agree with others that if the US dollar gets deflated big time, then everone will feel the shock.

As for Clinton:

The threats play into the presidential electoral campaign of Hillary Clinton, who has called for restrictive legislation to prevent America being "held hostage to economic decicions being made in Beijing, Shanghai, or Tokyo".
Is a bit rich, isn't it, when for most of the past 50 years the rest of the world has been hostage to decisions taken in Washington and the Federal Reserve. Sauce, goose, gander etc etc....