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The US owes China $800 Billion, probably in Treasury bonds at an interest rate of 3%.
Plan A
The US has 307,000,000 citizens, and 105,000,000 households with a median household income of $52,000.
$800,000,000,000 = approx $8,000/household
105,000,000
The US government could put together a stimulus package, give $8,000 to each household, and then take out an $8,000 loan from each house, at a rate of 3%, and pay off the entire Chinese debt.
That way, the Chinese debt would be gone, and the US government would owe $800 billion to its own citizens, instead of China. US citizens would be also earning 3% interest, which would be a huge stimulus.
Plan B
Banks could be required to reduce (or offset) the mortgage of each household by $8,000, and the amortized payment savings for those households, would go to pay off Chinese debt in entirety. Since mortgage interest is higher than Treasury Note interest, households would realize a profit, and stimulus.
