People are completely missing the point here. China has been selling down its USD assets for years, with little effect on the USD or Treasury market. What has shifted isn't China, or any single player "scheming" to dump UST. It's the global preference for holding UST as a risk-free asset. - ThreadSky

prchovanec.bsky.social • 3 days ago

People are completely missing the point here. China has been selling down its USD assets for years, with little effect on the USD or Treasury market. What has shifted isn't China, or any single player "scheming" to dump UST. It's the global preference for holding UST as a risk-free asset.

Reposted from Oldman Shoutingatclouds🇨🇦🏈

www.cnbc.com/2025/04/15/u...
“Not everybody agrees with Beijing resorting to selling Treasurys. "China selling down Treasury holdings would effectively be shooting themselves in the foot," said Michael Brown from Pepperstone.”

Isn’t it cute how they still think it’s economics as normal?

Comments

pauldimilla.bsky.social•2 days ago

Humans look for complicated patterns (with extremes of conspiracies) to satisfy their cognitive biases, sometimes disregarding simple explanations that conflict with these biases.

prchovanec.bsky.social•3 days ago

And if that continues, it is a much, much bigger deal than anyone's political decision to try to dump Treasuries.

r-floman.bsky.social•2 days ago

Don’t forget agency debt too, how much US debt, both US government, agency and corporate debt do foreigners actually hold in aggregate? 10-20 trillions dollars? If those are seeing selling pressure too, what are the implications for US businesses, banking and housing?

prchovanec.bsky.social•3 days ago

I'm not saying that what's happening in the Treasury market is no big deal. I'm saying it's a lot bigger deal than any of these narratives about China or Canada dumping Treasuries recognizes.

bierquaffer.bsky.social•3 days ago

I get it but where is the money going?

prchovanec.bsky.social•2 days ago

Dollars don't disappear (unless there is debt deleveraging), any more that Treasury bonds disappear. For every seller there is a buyer, and vice versa. The question is at what price, relative to other assets.

rodgilbert.bsky.social•2 days ago

Trump has destroyed the world’s trust. And some will make the argument that once he is gone that things will go back to normal.
I seriously doubt that. We elected him TWICE even knowing what he is. It is not who can’t be trusted. It is that the American public can not be trusted

biggerinjapan.bsky.social•2 days ago

People who claim Canada is coordinating a dump of treasuries to move the market have no comprehension of the size of this market, or how oversubscribed Treasury auctions tend to be.

biggerinjapan.bsky.social•2 days ago

The only thing that moves a market this size is global preferences. UST used to be a 0 risk asset - something you'd buy in order to trade it for cash quickly in a crisis. Now it carries systemic risks, and the price has changed accordingly, and probably permanently.

staceyryn.bsky.social•3 days ago

Apparently, decades of explaining the concept of "face" to Westerners had no effect.

realkeithlarson.bsky.social•3 days ago

Agree. I’ve been assuming it is real trade and currency assumptions. They would rather hold assets of partners they will trade with and that they expect further dollar depreciation.

xeynon.bsky.social•3 days ago

It's bizarre to me that people seem incapable of comprehending the idea that it's no longer a "safe haven asset".

goravseth.com•3 days ago

Alexa, please define "safe haven"...

xeynon.bsky.social•2 days ago

American exceptionalism biting us in the ass.

The funny thing is there is no real safe haven right now. Every country is a basket case in its own way.

benderlives.bsky.social•3 days ago

@stephaniekelton.bsky.social can you do an explainer on the impacts of this?

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