{"id":38102,"date":"2018-09-21T18:34:52","date_gmt":"2018-09-21T23:34:52","guid":{"rendered":"http:\/\/olduvai.ca\/?p=38102"},"modified":"2018-09-21T18:34:52","modified_gmt":"2018-09-21T23:34:52","slug":"the-dollar-shortage-chinas-bond-selling-are-about-to-corner-the-fed","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=38102","title":{"rendered":"The Dollar Shortage & China\u2019s Bond Selling Are About To Corner the Fed"},"content":{"rendered":"
\"\"<\/div>\n

The Dollar Shortage & China\u2019s Bond Selling Are About To Corner the Fed<\/a><\/h3>\n

Earlier this week \u2013\u00a0news went by relatively unnoticed<\/a>\u00a0by the \u2018mainstream<\/em>\u2019 financial media (CNCB and such) that Beijing\u2019s started\u00a0selling\u00a0<\/em>their U.S. debt holdings.<\/p>\n

Putting it another way \u2013 they\u2019re dumping U.S. bonds. . .<\/p>\n

\u201c<\/em>China\u2019s ownership of U.S. bonds, bills and notes slipped to $1.17 trillion, the lowest level since January and down from $1.18 trillion in June.\u201d<\/em><\/p>\n

<\/p>\n

Remember \u2013 dumping U.S. debt is China\u2019s\u00a0nuclear<\/em>\u00a0option (which I wrote about back in April \u2013\u00a0click here to read if you missed it<\/a>).<\/p>\n

And although they\u2019re starting to sell U.S. bonds \u2013 expect it to be at a slow and steady pace. They don\u2019t want to risk hurting themselves over this.<\/p>\n

I believe China may be selling\u00a0just enough\u00a0<\/em>to get the attention of Trump and the Treasury. A soft warning for them not to take things too far with tariffs and trade.<\/p>\n

Yet already just as news hit the wire that China was selling bonds a few days ago \u2013 U.S. yields spiked above 3%. . .<\/p>\n

<\/p>\n

Don\u2019t forget that China\u2019s the U.S.\u2019s\u00a0largest\u00a0<\/em>foreign creditor. And this is an asset for them.<\/p>\n

And although them selling is worrisome \u2013 the real problems started months ago. . .<\/p>\n

Over the last few months, my macro research and articles are all finally coming together. This thesis we had is finally taking shape in the real world.<\/p>\n

I wrote in a detailed piece a few months back that foreigners just aren\u2019t lending to the U.S. as much anymore (you can read that here<\/a>).<\/p>\n

I called this the\u00a0\u2018silent problem\u2019. . .<\/em><\/p>\n

Long story short: the U.S. is running huge deficits. They haven\u2019t been this big since the Great Financial Recession of 08.<\/p>\n

And it shouldn\u2019t come as a surprise to many.<\/p>\n

Because of Trump\u2019s tax cuts, there\u2019s less government revenue coming in. And that means the increased military spending and other Federal spending has to be paid for on someone else\u2019s tab.<\/p>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n","protected":false},"excerpt":{"rendered":"

The Dollar Shortage & China\u2019s Bond Selling Are About To Corner the Fed Earlier this week \u2013\u00a0news went by relatively unnoticed\u00a0by the \u2018mainstream\u2019 financial media (CNCB and such) that Beijing\u2019s started\u00a0selling\u00a0their U.S. debt holdings. Putting it another way \u2013 they\u2019re dumping U.S. bonds. . . \u201cChina\u2019s ownership of U.S. bonds, bills and notes slipped to […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[19913,88,130,21292,303,19915,839,3650],"class_list":["post-38102","post","type-post","status-publish","format-standard","hentry","category-economics","tag-adem-tumerkan","tag-bonds","tag-china","tag-dollar-shortage","tag-fed","tag-palisade-research","tag-us-dollar","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/38102","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=38102"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/38102\/revisions"}],"predecessor-version":[{"id":38103,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/38102\/revisions\/38103"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=38102"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=38102"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=38102"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}