Foreigners Dump Record Amount Of US Treasurys

Vitaliy_Kiselev

In the week ended December 28, foreign investors sold the second highest amount of US bonds in history, or $23 billion, bringing total UST custodial holdings to $2.67 trillion, a level first crossed to the upside back in April. This number peaked at $2.75 trillion in mid-August, and as the chart below shows the foreign holdings of US paper have been virtually flat in all of 2011, something which is in stark contrast with what the price of the 10 Year would indicate vis-a-vis investor demand. And going back further, the last week is merely the latest in a series of Custodial account outflows. In fact, in the last month (trailing 4 weeks), foreigners have sold a record $69 billion in US paper, a monthly outflow that was approached only once - in the aftermath of the US downgrade (when erroneously it is said that a surge in demand for US paper pushed rates lower - obviously as the chart shows nothing could be further from the truth).

Via: http://www.zerohedge.com/news/foreigners-dump-record-amout-us-treasurys-past-month

brianluce

So where are foreigners putting their money now? The conventional wisdom was/is allegedly that despites its problems, the dollar was still the safest bet in town.

Vitaliy_Kiselev

I think it is because this wisdom Japan and China few days ago agreed to transfer all their contracts to their currencies, avoiding any dollars :-) Or may be not :-)

Faudel

It is , they met on December 26,they decided to use their own currencies for bilateral trade,by the way Japan will invest in chinese bonds, they will probably convice South Korea to join them.
"Hey Yoshihiko"
"yes Hu ?"
"they are probably drunk now, lets throw up this toxic green paper"
"Can i keep some for private use ? You know how wasabi is"
"hmm ?.... use this red paper "

Maybe Wisdom is putting money in gold...

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