China: Record Budget Deficit

DPA reports: China sets record budget deficit as economic crisis bites. (Found in EarthTimes) By US or European standards even this record deficit is small (less than 3 % of GDP). But its increase raises questions with respect to the financing of the US budget deficit, which will also attain record levels. During recent years the US has relied on Chinese savings to finance its twin deficits. But what if China will now need more of its savings at home to finance its own deficit?