I guess the big story here is that people have been warning they would do this voluntarily in some attempt to punish the US and drive down the value of the yuan and drive up the interests rates so they can continue to undercut US businesses.
The fact they have been forced to do this is another scenario all together. This brings up an important question: What happens when the bidders who are absorbing all this paper, stop bidding? Then what does the Fed with all this paper in a highly liquid market?
Make no mistake though, this is the game the Chinese like to play with their currency in order to keep the value of the dollar high and the yuan low. Back in early 2015, they did the same thing:
Federal Reserve data published late on February 18 reveals China dumped about $75 billion in US bonds in the last six months of 2014
Breitbart broke the story last week that China’s real economic growth had crashed to 1.7% in the fourth quarter of 2014. We also warned last August that China appeared ready dump part of its $1.32 trillion holdings of US bonds in a scheme to drive American interest rates up; thereby strengthening the dollar and devaluing the Chinese currency.
The fact they have been forced to do this is another scenario all together. This brings up an important question: What happens when the bidders who are absorbing all this paper, stop bidding? Then what does the Fed with all this paper in a highly liquid market?
Make no mistake though, this is the game the Chinese like to play with their currency in order to keep the value of the dollar high and the yuan low. Back in early 2015, they did the same thing:
http://www.breitbart.com/national-security/2015/02/19/trade-...
Federal Reserve data published late on February 18 reveals China dumped about $75 billion in US bonds in the last six months of 2014
Breitbart broke the story last week that China’s real economic growth had crashed to 1.7% in the fourth quarter of 2014. We also warned last August that China appeared ready dump part of its $1.32 trillion holdings of US bonds in a scheme to drive American interest rates up; thereby strengthening the dollar and devaluing the Chinese currency.