- Joined
- Oct 17, 2007
- Messages
- 11,862
- Reaction score
- 10,300
- Location
- New York
- Gender
- Male
- Political Leaning
- Centrist
It's interesting that you should bring this up. If you go back three years to 2011 in the month of July, something very interesting occurs. Basically there is a peak of 1314.9. This is of interest because from the year 2000, up to July 2011 there is a very substantial increase in China's holdings of US treasuries. After that there is a basic plateau and in fact when their holdings again come to that level in November 2013, there is a sell off the next month. So if you look over the last three years basically the are letting the level plateau out. So basically, they are not interested in increasing there holdings. They just want them to level out. This is consistent with the following statement:
PBOC Says No Longer in China
I don't disagree that the rate of Treasury accumulation has slowed, in line with China's goal of achieving greater diversification and in line with its macroeconomic situation. But that's quite different from the two-year-old piece that pounced on one of the typical fluctuations one sees during annual periods to declare, "But more recent Treasury data show China has been selling Treasuries outright." What happened then was a temporary drop in a trend that still shows net increases in China's holding of Treasury securities. When the trend line turns down and that inversely-sloped line persists for some time, then one can reach the conclusion that China has become a net seller of Treasuries. That isn't the case now. The Barron's piece was reached an erroneous conclusion by failing to include a representative sample of China's Treasury transactions.