China vs. the US: Who's going to win this?

Recently, the US and China have been sparring a bit.

We recently made a 6.4 billion dollar military arms sale to Taiwan which, of course, upset the mainland. That always gets them going.

Then we recently increased our tariffs on their steel and tires.

Higher tariffs on anyone is never well-received, naturally.

This week we also found that President Obama is going to meet with the Dalai Lama , personally, finally, too.

The President can't back down from this meeting, frankly, because he had already put it off at least once, just before he went to China. If he were to put it off now, again, he would look soft on China, it's perceived and he'd be seen as giving in to pressure on them.

Anyway, they aren't liking this meeting.

All this on top of the fact that China is our biggest lender.

Most people would say they "own us."

It seems to point out that China may have already won any contest we're in against each other.

We hope that's not the case but we're so intertwined and, as I said, we owe them so many billions and trillions of dollars of our debt, how can we really fight them in any arena, without shooting ourselves in a proverbial foot? How do you fight your banker?

The banker always wins.

The banker is in control.

Remember the cynical--but true--"golden rule"?

"He who has the gold, makes the rules."

Food for thought.

On the one hand, we can hardly afford to upset them.

On the other, we can't be seen as weak and/or giving in to them, even if they are our financial masters.

This is going to be a tough relationship to handle for some time to come.

(Unless China's economy collapses).