China Just Dumped the Largest Amount of U.S. Debt in History
Dropping It Like a Hot Potato, the Lowest level of U.S. Debt Ownership in Decades, Not Just a “China-Leaning” Countries Problem
At this point, the government is completely and totally bankrupt. It’s like Wile E. Coyote that’s walked off a cliff, but doesn’t really realize it yet.
~ Doug Casey
We just learned that China has accelerated its de-dollarization efforts with record sales of U.S. debt.
Turns out, China dumped a staggering $53.3 billion worth of U.S. Treasuries and U.S. agency bonds in the first quarter of this year.
Interestingly, the Chinese government announced the sale right after issuing a joint statement with Russia, where both nations emphasized their resolve to keep moving away from reliance on Western countries.
No doubt, this will seriously dent the appeal of U.S. debt on the international market. But let’s take a closer look to see exactly why.
Yes, It Is a Big Deal...
Now, this isn’t the first time China has unloaded a portion of the U.S. debt it owns. For example, the country sold $21 billion in U.S. Treasuries and agency bonds in late 2023.
But what makes this latest dump stand out is that it’s the first time China has shed such a big chunk of debt so quickly.
The move brings the nation’s holdings of U.S. government debt to around $767 billion. That’s the lowest level of ownership in decades.
It’s quite something when you think about it… Just a few years back, China was leading the pack in investing in U.S. debt. Things changed around 2018 though, when the trade war with the U.S. began. By 2019, China ceded the position to Japan as the biggest holder of U.S. debt.
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