Posted on 10/07/2015 8:36:10 AM PDT by Enlightened1
Central banks around the world are selling U.S. government bonds at the fastest pace on record, the most dramatic shift in the $12.8 trillion Treasury market since the financial crisis.
Sales by China, Russia, Brazil and Taiwan are the latest sign of an emerging-markets slowdown that is threatening to spill over into the U.S. economy. Previously, all four were large purchasers of U.S. debt.
Few analysts expect much higher yields in the Treasury market as a result. Foreign private purchases of U.S. debt have increased amid pessimism about the world economic outlook. U.S. firms and financial institutions continue to buy Treasurys, as do some foreign central banks.
Still, many investors say the reversal in central-bank Treasury purchases stands to increase price swings. It could also pave the way for higher yields when the global economy is on firmer footing, they say.
(Excerpt) Read more at wsj.com ...
So now the Chinese won’t own us anymore?
Interesting but not in a good way.
Darn!
Just as silver was dropping to $14.00 !!!
When you are having financial difficulties, as these countries are, you sell what you can to get needed cash. US T notes and bonds are easily traded and if they sell them before an interest rate increase they may get a bit more than they would after the increase. Just makes sense.
The party can continue until the music stops and the lights go up.
Then everyone sees the mess.
Makers of counterfeit goods know a fake when they see it i.e. Three Dollar Barry.
[Just as silver was dropping to $14.00 !!!]
Gold is actually down (-.20) at this moment but that’s likely to change.
Sad, but true.
If you hold a U.S. Treasury bill paying 2% interest, you're not in good shape over the long run. But if you hold a U.S. Treasury bill paying 2% interest and you are a country like China that devalues its currency by 20%, then your return on your initial investment looks more attractive.
All these countries are desperate for cash to pay their bills.
I think the BRICS Central Bank has A LOT to do with it too.
Exactly!
What about the BRICS Central Bank?
I think that is the main reason.
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