When we reported last month that in a shocking twist, "Belgium" holdings of Treasurys had soared by a massive amount in the past three months, making the tiny country the third largest holder of US paper, our Belgian readers took offsense alleging it is impossible that Belgium itself could be buying all this paper, explaining it was all Euroclear. Well, yes: we know and noted that, which is why those same readers probably should have actually read the part in the post which said: "our question is: just who is Belgium being used as a front for?
Recall that for years, the "UK" line item on TIC data was simply offshore accounts transaction on behalf of China. Of course, since China hasn't added any net US paper holdings in the past year, the UK, and China, are both irrelevant in the grand scheme of things. "
So yes, to clarify for our trigger-happy Belgian (non) readers: it is quite clear that Belgium itself is not the buyer. What is not clear is who the mysterious buyer using Belgium as a front is. Because that same "buyer", who to further explain is not China, just bought another whopping $31 billion in Treasurys in February, bringing the "Belgian" total to a record $341.2 billion, cementing "it", or rather whoever the mysterious name behind the Euroclear buying rampage is, as the third largest holder of US Treasurys, well above the hedge fund buying community, also known as Caribbean Banking Centers, which held $300 billion in March.
In summary: someone, unclear who, operating through Belgium and most likely the Euroclear service (possible but unconfirmed), has added a record $141 billion in Treasurys since December, or the month in which Bernanke announced the start of the Taper, bringing the host's total to an unprecedented $341 billion!
Also of note: Chinese holdings of US Paper dropped by $2.7 billion to $1273 billion, offset by Japan's $9 billlion increase in holdings to $1210 billion, as the convergence between the two countries resumes.
One thing that is certain: the mystery buyer is not Russia, which in February, or just as the Ukraine conflict was starting, sold another $6 billion, bringing the Russian total to $126 billion, the lowest since 2011, and the biggest annual drop, -24%, in holdings in history.