China threatens bond war on Japan

China should attack the Japanese bond markets and cause a full-scale funding crisis, unless the latter nation reverses a decision to nationalise the Senkaku/Diaoyu islands, a senior advisor to the Chinese government said.

Jin Baisong, a member of the Chinese Academy of International Trade and Economic Cooperation which is affiliated to the Ministry of Commerce, said China should wield its power as Japan's largest creditor and "impose sanctions on Japan in the most effective manner". This would deal a "heavy blow" to the Japanese economy, which is already on the brink of a fiscal crisis. Writing in the Communist Party newspaper China Daily, Baisong said: "An analysis of Sino-Japanese economic interdependence shows that Japan's economy will suffer severely if China were to impose sanctions on it. China's lo...