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Now this is JUST the New York Post but could this be a trial balloon regarding how to confiscate the US Treasuries owned by China — $2-3T as I understand recent counts — along the lines of the recent confiscation of Russian $US treasuries — but without the death & destruction of war?
And there you have it. The pretext for how Washington will default on its Treasury sales to China has just been written. In the process US hawks will be emboldened to move against China in the financial realm and possibly seize a substantial portion of its assets held abroad by America and in friendly jurisdictions like Canada. The purpose of this is to give cover to US Military involvement while creating a streategy to avoid outright default against trade partners some years down the road. Its the last ditch effort of a creditor to sink its lenders when the bill gets too high.
I have not seen an estimate of Chinese holdings of US Treasuries as high as two to three trillion dollars worth. It is most commonly reported at around three quarters of a trillion. As well, I have no idea the value of American holdings in China, but I would assume them to be huge. Any confiscation of Chinese assets by the US would be followed by the complete confiscation of American assets by the Chinese, and if relations sink to that level, why would China continue to export goods to the US, and how would the US replace them? If such moves took place, the world’s economy would instantly crash. I suppose it could happen, but it would be an exceptionally stupid move. That being said, the US is making exceptionally stupid moves with some regularity these days.
A voice of reason in the cacaphony of Insanity
Strider – you are correct — my info was out of date – China has reduced it’s holdings by just under 50% over past 10 years. Down from $1.4T to $750B area. I as under the impression that there were processes in place to ensure the original balance remained relatively stable – apparently not!