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Who [Bought|Sold] How Many Treasuries In 2009?
Yesterday we first pointed out the rotation at the top of foreign US debt holders, with China selling $34 billion in USTs (shifting to a longer duration exposure by selling Bills and buying Bonds) to a new total of $755 billion, and giving up the top US debt holder position to Japan, which with $769 billion in UST holdings regained the top spot for the first time since August 2008. Overall, total foreign debt holdings in 2009 increased by $538 billion, with two unexpected buyers emerging in the face of Japan and the UK, which combined accounted for 58% (or $314 billion) of all 2009 purchases. We say surprising, because it has been long publicized that both countries have their own internal funding issues to grapple with: Japan an uncontrollable deflation and a demographic shift, which would make JGB's a better buying proposition than chasing micro yield in the US, while the UK is engaged in its own version of Quantitative Easing. With the BOE taking on excess supply one wonders how the UK can spare the dime to purchase our own debt (of which we have plenty more to issue in the future)?
Below is a chart that summarizes the change in holdings by major holder.
Summarizing the data:
- Japan is the top holder of US debt at $769 billion, a $143 billion increase from a year prior.
- Chinese holdings increase by a mere $28 billion, ending the year at $755 billion, and down from a peak position of $801 billion.
- Foreign holding were split 23% bills and 77% bonds, compared to 21% bills and 79% bonds at the end of 2008.
And while the change in the top two UST holders was not exactly a surprise considering all the recent jawboning out of China, what was notable was the puke in corporate debt in 2009, of which foreign investors sold a total of $41 billion in 2009, compared to buying of $94 billion in 2008. More on this in a later post. With the roll becoming an issue not only in the UST arena, but in corporate as well, should this defensive posture in corporate debt from external investors persist, then this observation could have even more troubling implications as the LBO wave of 2005-2007 comes due for refinancing.
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UK/J bought bonds from the US. Did the US by the way buy UK/J's bonds during the same period. An other way of "QE"? Anyone knows?
But why does the UK runs such a high deficit and still buys treasuries?
I think you helped save uour economy at expense of their own.
US Federal Reserve buys their junk, we in turn buy their junk. Remember Bernanke gave Europe HALF A TRILLION DOLLARS and he REFUSED to say who got the money to CONgress.
www.youtube.com/watch?v=00ECLxK2YTs
"This is your last chance. After this, there is no turning back. You take the blue pill - the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill - you stay in Wonderland and (I) show you how deep the rabbit-hole goes."
Keep taking the red pills TD et al, the world needs the truth
Isn't Kool-Aid red, too?
Naw, it's every color. It comes in orange, purple, blue, yellow, pretty much EVERY color EXCEPT GOLD!
Master Bates, you should know that the golden is a favorite with the regression set, but they usually have to pay a little more.
True, there are some who drink the gold kool aid every day!
Not as many as those who drink the us trashery coolaid. Gold has more than a decent amount of shorts, and yet it still continues to fight against the wind.
Don't drink yellow Kool-aid... don't eat yellow snow...
Funny things happening to your posts, MB...
har har har har !!!
Once the BS good news runs out it will
ONEY and I care NOT who writes the LAWS," Nat_han R0thschi1ds
Learn the truth behind the fake recovery!!FED does that for the Financial Aristocracy and D1CTAT0RSHIP!
“What to do:
1. Allow the Financial Dictatorship where Wall Street Banksters Owns Congress? http://bartspace12.blogspot.com/2010/02/deficits-unpaid-banks-fed-move.html
2. A State trying to serve its Communities' Needs on Main Street while maximizing productivity and employment?
Is this a Difficult Decision? If you are a Bankster you want #1! If you are everybody eles you want #2!”
“Yes and they are using REAL LOANS - NOT FAKE FRAUDULENT PAPER that is "SURE to FAIL!" so Massive Casino Bets can be ” PAID to CR00KS!
Taking the red pill means there is no going back. Your life will never be the same. No more unicorns and popsicles. Be prepared.
Hong Kong is up becasue the HK$ is pegged to the US and believed to be a proxy for the Yuan. So hot many has been going there. But it is just that. Hot. When the HK$ gets revalued this number will come way down. My guess $100b.
The UK thing just bugs me. There is no reason for this big increase that I can think of. I am sure you are aware that some are speculating that China is buying US paper via the Bank of England. (The direct/indirect bidder issue)
That explanation has no legs. Why would the Chinese do that? If they are doing it, I sure would like to understand the 'whys' of it.
I don't know why but I don't think it's speculative to say it's china.
China tends to account for a very large share of purchases through the UK.
From mid-2006 to mid-2007, about 2/3s of the UK’s purchases of Treasuries were ultimately reassigned to China. I would expect the something similar is happening now — all of China’s bill holdings tend to appear in the US data in real time, but only a fraction of China’s long-term purchases tend to show up directly in the US data.
http://econompicdata.blogspot.com/2010/02/china-sells-treasuries-or-did-...
http://blogs.cfr.org/setser/files/2009/06/china-tic-may.png
The US and UK have been one big happy Anglo-Saxon family for more than 200 years. The House of Morgan has always been more or less controlled by the Rothschild interests, and geopolitically the two nations have basically acted as one since the early 20th century. Both will sink or swim hand in hand.
FWIW-
I have been told it is because the US is putting pressure on China to revalue their currency. So by devaluing (buying our debt) secretly through the UK, it takes some of the pressure from the US off of them. This is what i have been told from a source anyway.
It's the US' bitches who bought and keep buying.
Any true sovereign state wouldnt load up on toilet paper.
Holding US treasuries is a good indicator for the scale of dependence of the butt fucking father called "USofA".
The late British actor/comedian Terry Thomas would say, "Good God, we have QE running amuck amongst us!"
The UK is clearly a holding tank for someone else. The $64,000,000 question is "who is that someone else"? Is it the Fed, funding through so-called currency swaps? Talk about an off-balance sheet SPV!!
It is like a central bank circle jerk, where everyone is happy to monetize and fantasize until someone gets off. The hope is that by then the prestidigiflation has worked its magic on the global economy.
aww, ya beat me off to it Hedgeless.....
Either UK and Japan are in on a gigantic ponzi scheme with each other buying the others debt and / or Japan and UK are taking on a huge trade (Short their own debt (hence debt issuance) / long US debt).
Who disagrees? Any other logical and rational explanations? I guess you could argue they buy eachothers debt to help debt markets function, but this is a more polite way to say they have a form of a sovereign debt ponzi scheme going on amongst themselves.
Why has our Poweres That Be not "killed" naked CDS' yet?
Is Greece the only country who has used Goldman's services to play fast and loose with hiding debt?
Is Japan the new/next Greece from the perspective of contractual obligations it has entered into ... aka derivatives ... naked ... except for their tax payer's money?
Has Ben or Tim entered into any such financial instruments?
When does off the books become a one way ticket to the slammer?
Anyone see the USD quietly rallying today? The Nasdaq can't get past its 50 day MA either. This zone above S&P 1100 is loaded with resistance.
And why would the markets stop at a fifty percent retracement anyway?
We're going to inflate to the moon anyway!
Your on the wrong forum guy, you should be over at GLP posting your drivel. Wish you could stay, here's your hat.
Offshore UK = China
^^Yep, the game continues.
a good blogpost in fact on the UK build = China sneaking purchases.
http://econompicdata.blogspot.com/2010/02/china-sells-treasuries-or-did-...
let's have both UK/US central banks print $500 bil each and use said amounts to come to one another's aid. when either party's auctions fail, counter-party steps up to buy. after three years both countries can do a simultaneous swap of this debt, costing little. then we could sell derivitive contracts on the likelihood of default on these inter-central bank bailouts.
nah, never mind
Maybe someone knowledgeable would opine on the possible connection between the March 2006 cessation of the M-3 metric, which counted Eurodollars (including dollars in UK banks) and this periodic "resurgence" of UK UST buying whenever we get in a bind, which is now all the time. How difficult is it for the Fed, sub rosa, to "recapitalize" UK banks on the understanding they will show up at the Direct window at the next auction?
Japan is finished. It's over.
It's pretty naive to think that the bankrupt UK is buying treasuries of its own accord. It's one of the world's biggest money laundering centers. The Fed could be buying via UK for all we know (and probably is).
Can someone explain why the data at this link
http://www.federalreserve.gov/releases/h41/
shows that the assets of the New York Fed, the Richmond Fed, and the San Francisco Fed have exploded while all the other regions' assets haven't (e.g. Minneapolis). Is it related to the real estate values in the regions? In other words, all this MBS and agency garbage they're buying being allocated to the region where the underlying mortgage payment streams (i.e., pipe dreams) were to have come from? Does any of this matter?
are these govt purchases or mutual funds residing in UK?
hah! Suckers!
End around, snake eats it's tail. what did you think they would do, not run it into the ground?
Thsi is some deep sh.1t now ..I tell ya
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