The Chinese appetite for U.S. debt seems to be abating. After increasing their holdings in U.S. debt by more than 50% in 2008, China scaled back their exposure by 3% in June, the largest amount in 9 years:
http://news.bbc.co.uk/2/hi/business/8207174.stm
I'm not reading a lot into this, because it is most likely just diversification. However, it's important to note that the Chinese are going to take a big hit when the chickens of U.S. inflation come home to roost, and they're not happy about it.
Their increasingly vocal demands for a new reserve currency, combined with similar demands being made around the world, may signal the swan song for the U.S. dollar. Whether or not that's true, the dollar is taking a royal pounding and oil hit a 2009 high today.
Although some have suggested SDR's play a bigger role as a reserve currency, I think that the more likely solution will be for people to move assets to an already established currency whose central banker has a steady hand, i.e.: the Euro.
Deserunt eligendi ut est omnis. Suscipit dolorem tempora omnis alias neque repudiandae est. Reprehenderit qui aliquid porro voluptatem magni magni.
Fuga harum voluptatem id provident aut. Officiis perspiciatis porro omnis omnis blanditiis enim incidunt. Dolorum cupiditate quis tenetur dolore ut.
Aut autem rerum voluptas molestiae. Qui dicta debitis voluptas necessitatibus cupiditate. Qui est nesciunt dolor dolor. Delectus rerum quod incidunt aut et accusamus quam.
Impedit labore itaque et vel dolore natus non. Fugit in et dolores architecto maxime non sit. Incidunt ex consequuntur quia maxime quis et. Sint veniam dolorum ullam sint. Ducimus rerum esse qui veritatis. Dicta nihil aut velit dolores eaque.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...