In 2019, an article in a magazine in the United States said that China had to pay back the yellow son a hundred years ago, otherwise the United States would not recognize the $86 billion US debt held in China's hands. This word came to the air, and everyone felt that this was the old account new account, and there was nothing. In the article, it was said that the benchmark was rolled to the trillion level, but it did not mention the historical truth, so hardly mixed the old account and modern finance together.
A hundred years ago, we had to start from the 1900, when the forces of the eight coalition troops entered Beijing, and the Qing government could not bear it, it had to sign the “Dangerous Treaty”. In the treaty, China had to pay off 4.5 million two silver, 39 years to pay off, the total interest was 9.82 billion two. The United States was divided into 32.93 million two, in exchange for about 24 million dollars at the time. This money the government crushed the head together, added tax debt, interest rates also layered over, and actually paid far beyond the contract.
The United States didn't get it for nothing. In 1904, Rou Keyi, the U.S. Minister to China, went to verify the losses. After checking, he found out that the United States actually only lost 11.65 million U.S. dollars, equivalent to more than 16 million taels of silver, and the overcharge of 10.78 million U.S. dollars had no basis. Rou Keyi's report was handed over to the State Department, and President Roosevelt pondered it for a while. On May 25th, 1908, Congress passed a resolution and decided to return this part, but there was one condition: the money had to be used to help Chinese students study in the United States. Not for nothing, but with a purpose.
In 1909, China and the United States set up a tourism aesthetics office, which specially selected students to send them there. In 1911, Tsinghua School in the western suburbs of Beijing was built in this way, and the main fund was this refund. The first batch of 47 students went to the United States by boat, and many of them became the backbone of China's modernization after completing their studies. On July 16, 1925, President Coolidge signed another order to waive the remaining $6.13 million and continue to spend on science education. This refund is not charity. The United States wants to draw closer relations through education and cultivate pro-American forces by the way. There are thousands of international students in Geng, which have far-reaching influence. Tsinghua has gradually changed from a primary school to a top university, and many facilities and teachers in it have been touched by this light.
In the case of the refund, the U.S. own archives are clearly written. State Council documents show that the 1908 withdrawal money from the 1909 period came, the Qing government had to report the purpose, the United States also sent people to oversee, afraid of his use. Yuan Shikai as the Northern Ministry wanted to take money to mine, but the U.S. did not work, insist on the use of education. Liang Ying as the U.S. Ambassador, ran before running after this amount, spent a lot of time. Yuan's study was not a smooth, early years of students English foundation poor, cultural shock great, but overall pushed Chinese talent output.
In return, this old debt has long been a problem.On January 11, 1943, China and the United States in Washington signed the Treaty on the cancellation of U.S. foreign rights in Washington and dealing with related issues, and the United States officially renounced the remaining compensation rights.Waydowing Ambassador and Secretary of State Hale signed the treaty clearly stated that the old account can be cancelled.Archives can now be checked, the U.S. State Department treasury is locked.In the Hu Jing diary also remembered that the U.S. representatives said "old debt is closed, new chapter is opened."At this time, the second war is in the heat, China and the United States are allies, and the abolition of foreign rule law is to China's anti-war momentum
After the establishment of New China in 1949, the 21st September announcement came out, all inequal treaties were abolished, including compensation. The U.S. side was not entangled, the archive was so lying. The U.S. media now reversed the account, it was nothing to do. In international law, this is called the "bad debt not to pay" principle, the debt under coercion is not equal, the new regime is not obliged to carry. The United Nations and the IMF recognize this set, the U.S. law itself can not stop. In 2019, the article came out, international rumours, IMF officials at private meetings shake their heads straight, saying that this is a political trick, and the financial rules can not beat the eight-step.
In the case of US bonds, China’s holdings have changed, and it’s not at its peak in November 2013, at the peak of $1.3167 trillion, when there were more foreign exchange reserves, and the US debt was stable when it was bought as a security. As a result, December 2024 fell to $759 billion, July 2025 was lower, 730.7 billion, to the lowest level since 2009. Reduced by more than 40%, and not less. Why decrease? for many reasons. Economically, U.S. policy has shaken, the U.S. Federal Reserve has raised interest rates like a hike, the dollar exchange rate has rolled, and risks are high.
Politically, the US-China trade friction has not stopped. U.S. added tariffs, disconnected, Chinese enterprise costs exploded, foreign exchange must prevent the point. If assets are frozen like Russia, who dares to hold U.S. debt? Moreover, the U.S. government bonds have accumulated to more than 36 trillion, the annual deficit has broken a record, in 2025 it is estimated to exceed 1.4 trillion, interest rate is 900 billion. The government relies on debt issuance over the day, the welfare bank economist Wang Wei said that this is in line with marketization, global uncertainty, and the independence of the U.S. Federal Reserve is also suspected. The Monero report also shows that China has no structural deficits, preferred short-term
This remark by the US media is pressure in its bones. In recent years, China and the United States have been at loggerheads in trade, science and technology diplomacy, and the United States can't do it, so it creates momentum by public opinion and wants to disturb China's rhythm. At home, the debt of the United States is frying, people are complaining, and the media throw this topic away to divert attention. The snowball is getting bigger and bigger, the economic difficulties are deep, and the government is anxious. It uses China's old debts as an argument and forces China to buy more US debts. Whimsical, China doesn't eat this set. Reducing holdings is a strategic choice to maintain economic security. The international community is watching the excitement. Al Jazeera analyzed that U.S. debt accounts for more than 122% of GDP, which is the wartime level. With the tide of reduction of holdings, the debt crisis is not far away. China is the third largest holder, Japan and the United Kingdom. Japan holds more than 1.1 trillion yuan and the United Kingdom holds nearly 800 billion yuan. In the month that China reduced its holdings by 25.7 billion yuan, foreign countries held a total of 9.16 trillion yuan, a record, but China's share shrank significantly.
In fact, the United States wanted to shake China’s neck, but the lessons of history were there. The return of the surfaces of the public interest, in fact, is part of the policy of opening the gate, the United States wanted to split the cup in China. The reimbursement of funds, educated talent, in turn helped China to modernize. The 1943 treaty was an ally gesture, the peak of U.S. influence after the Second World War, and now, the wind turns. China’s foreign currency is more than 3 trillion, reducing U.S. debt, transferring gold to other assets, and steadfastly fighting. The U.S. media cries, in exchange for the loss of credit. The IMF officials broke, the old debt crawl, destroyed the international financial order.