- The Washington Times - Saturday, March 14, 2009

WASHINGTON (AP) - The Chinese and other foreign investors should have “absolute confidence” in the soundness of their investments in the United States, President Barack Obama said Saturday.

Obama commented in the Oval Office in response to a question about the Chinese premier’s concerns over the safety of his country’s holdings in America. China is Washington’s biggest foreign creditor, with an estimated $1 trillion in U.S. government debt. The Obama administration is counting on the Chinese to help pay for the $787 billion economic stimulus package by buying U.S. bonds.

Obama, who has worked to help revive the slumping U.S. economy since taking office in January, declared that investors have no reason to be afraid and that investments in the U.S. have increased even during the financial crisis.

“I think that not just the Chinese government but every investor can have absolute confidence in the soundness of investments in the United States, and that is not just in U.S. issues, Treasury notes, but also in the private sector and the commerce and the industry that has made us the most dynamic economy in the world,” Obama said after meeting with Brazilian President Luiz Inacio Lula da Silva.

Obama said he intends to make his push for stricter regulation of the financial industry “front and center” at the Group of 20 summit in London early next month. Obama has said tougher, updated rules would likely prevent future meltdowns in the industry.

“We have to do financial regulation, and nobody’s going to be a more vigorous promoter of the need for a reform of our financial systems” than the United States, Obama said.

He has criticized existing U.S. rules and regulations as being outdated for a 21st century industry, and said other nations also will have to update their regulatory structures to prevent a repeat of the current crisis.

Obama said a full range of approaches, including stimulus programs, are needed to turn around the economy, but that “financial regulation is front and center in terms of the issues that we want to deal with.”

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