One of the top creditors of the entity known as "America," Chinese premier Wen Jibao, is getting a little anxious about his investment. Per the FT:

Wen Jiabao, the Chinese premier, expressed concern about the value of China’s large holdings of US assets on Friday and warned America to take measures to guarantee its “good credit”. ...

“We have lent a huge amount of money to the United States,” Mr Wen said. “Of course we are concerned about the safety of our assets. To be honest, I am a little bit worried. I request the US to maintain its good credit, to honour its promises and to guarantee the safety of China’s assets.”

It strikes me that China is in a bit of a bind here. (And not the bind that's usually mentioned--which is that China can't suddenly start dumping its holdings of U.S. Treasuries, because that would cause the price to plummet and devastate its remaining holdings. Just not easy to unwind a nearly-trillion-dollar investment.) The bind is that, on the one hand, a major creditor like China doesn't want to see us become, you know, insolvent. On the other hand, China kind of needs us to help stimulate the global economy and bailout the world's financial insititutions. It's obviously a little tricky to achieve both objectives at once.

Update: In a Q&A after a speech just now, Larry Summers had this to say on the question of government debt. (Not sure if Wen's comments prompted the question. Possible.)

"If my speech was intended to persuade you of one thing, it's that [the crisis] is not a set of economic processes that would simply and automatically fix themselves if you didn't act."

He continued: "I track the markets very closely and my reading is that the central variable is whether we are successful in establishing confidence that the economy will recover and growth will be restored and we will have a sustainable expansion. If we put that at risk in the name of some generalized concern about austerity, we would be doing the wrong thing by the economy and ironically, even doing the wrong thing by the markets."

Further, he said: "If deflation sets in, if GDP collapses further, if the consequences of that [impact] even the insured parts of the financial system; if that happens, the magnitude of the federal borrowing -- as large as it is today -- will be dwarfed; it will be far, far larger."

That sounds about right.

--Noam Scheiber