OTCQX:BGMZF - Post by User
Post by
chumpismeon Feb 12, 2010 2:07pm
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Post# 16781210
Chinese see U.S. debt as weapon in Taiwan dispute
Chinese see U.S. debt as weapon in Taiwan disputeChinese see U.S. debt as weapon in Taiwan dispute
China's military stepped up pressure on the United States on Monday by calling for a government sell-off of U.S. debt securities in retaliation for recent arms sales to Taiwan.
Today China foreign reserves are more than $2.7 Trillion, which increase monthly due to over-whelmingly positive Trade Surplus with the USA. Moreover, about 70% of China foreign reserves are denominated in US dollars. Further, China is the world's largest holder of US Treasurys. Worst yet China only possesses 1/8 of the amount of gold reserves as does the USA - despite the fact China has 27 TIMES more foreign reserves as the USA. Consequently, one may logically reason China will slowly divest itself of US Treasurys and subsequently snap up all the gold it can gather. The specific objective is to diversify China FOREX risk, and stem the loss in its dollar investments.
In light of above the US dollar will relentlessly decline as the price of gold rises. It is eventual and inevitable.
https://www.washingtontimes.com/news/2010/feb/10/chinese-see-us-debt-as-weapon/