Doug replied: "What goods? Aside from aircraft, what capital equipment would the U.S. export to China? Most of China's capital goods imports come from Japan and other Asian countries."
US consumes more than exports, has balance of payment problems. Borrows to finance the deficit, and Chinese investors in effect convert US debts into US financial assets.
But you say the Chinese can't or are not going convert these financial assets into purchases or licsening of pharmaceutics, aircraft, software, speciality and logic chips, medical equipment, etc from American multinationals.
You may well be right but then this question: Why then the appetite for US financial assets? Rakesh