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What Would Happen If Everyone Joins China In Dumping Treasurys?
On Tuesday evening in "Devaluation Stunner: China Has Dumped $100 Billion In Treasurys In The Past Two Weeks," we quantified the cost of China’s near daily open FX operations in support of the yuan.
As BNP’s Mole Hau put it on Monday, "whereas the daily fix was previously used to fix the spot rate, the PBoC now seemingly fixes the spot rate to determine the daily fix, [thus] the role of the market in determining the exchange rate has, if anything, been reduced in the short term." And a reduced role for the market means a larger role for the PBoC and that, in turn, means burning through more FX reserves to steady the yuan.
Translation and quantification (with the latter coming courtesy of SocGen): as part of China's devaluation and subsequent attempts to contain said devaluation, China has sold a gargantuan $106 (or more) billion in US paper just as a result of the change in the currency regime.
Notably, that means China has sold as much in Treasurys in the past 2 weeks - over $100 billion - as it has sold in the entire first half of the year. Today, we got what looks like confirmation late in the session when Bloomberg, citing fixed income desks, reported "substantial selling pressure in long end Treasuries coming from Far East."
The question or rather, the series of questions, that need to be considered going forward are:
"What happens when China liquidates all of its Treasury holdings is anyone's guess, and an even better question is will anyone else decide to join China as its sells US Treasurys at a never before seen pace, and best of all: will the Fed just sit there and watch as the biggest offshore holder of US Treasurys liquidates its entire inventory…"
And make no mistake, these are timely questions, because the combination of collapsing commodity prices, China’s devaluation, and the threat of a Fed hike have put enormous pressure on EM currencies the world over and that, in turn, means a drawdown of EM FX reserves and pressure on DM bonds. As JP Morgan put it last month, "the sharp reversal in EM FX reserve accumulation between Q1 and Q2 is consistent with the sharp reversal in DM core bond markets. Core bond market yields collapsed in Q1 but saw a big rise in Q2. This is a good reminder of how important FX reserve managers remain in driving core bond markets."
Indeed. And just how important, you ask, is that for US Treasurys and, in turn, for Fed policy going forward? For the answer, we go to Citi:
Taken in isolation, a reserves drop of 1% of USD GDP (=$178bn) would infer a rise in 10y UST yields by 15-35bp based on a range of academic studies.
And more to the point:
Suppose EM and developing countries, which hold $5491 bn in reserves, reduce holdings by 10% over one year. This amounts to 3.07% of US GDP and means 10yr Treasury yields rates rise by a mammoth 108bp (35bp*3.07).
In other words, if EM currencies remain under pressure - and there is every reason to believe that they well - the reserve drawdown necessary to stabilize currencies and maintain unsustainable pegs means more Treasury liquidation and massive upward pressure on yields. Here's a look at EM reserve accumlation vs. the yield on the 10Y (inverted):
As for what this means in the US, we go to Citi one more time:
These moves are unlikely to happen in a vacuum. For instance, any move by these magnitudes would choke off the US housing market and see the Fed stand still or ease.
Of course one of the catalysts for the EM outflows is the looming Fed hike which, when taken together with the above, means that if the FOMC raises rates, they will almost surely accelerate the pressure on EM, triggering further FX reserve drawdowns (i.e. UST dumping), resulting in substantial upward pressure on yields and prompting an immediate policy reversal and perhaps even QE4.
And as we never, ever tire of reminding readers, it all harkens back to last November...
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they won't...ther's nowhere else to go
higher interest rates...
Goldman Says Stock Market Sell-Off Will Soften Fed Rate Increase $TLTThe whole thing is a ponzi, supported by the US military. The fed is screwed because as foreigners move away from the dollar and Treasurys, fiscal responsibility lands back on US shores. OMG... can't have that, now can we!! That scenario guarantees a dollar revaluation because the US is a social state driven by consumption, not production.
What happens if they dump faster than we pump? Timing is everything.
The olde "One Lump or Two?" dilemma!
"and an even better question is will anyone else decide to join China as its sells US Treasurys at a never before seen pace"
Easy answer. Using our military on China or Russia is problematic. Everyone else gets the stick.
If this selling becomes the beginning of a bond market rout, what will people turn to when they are just now realizing that stocks are risky again. Precious metals will have their day in the sun soon enough, as long as you're patient.
This story is too much of a unlikely "what if".
What is more likely is, that EM countries that have taken on debt in US$ will have to buy $ (to pay back interest and debt), thereby bidding it up and lowering $ interest rates. The US stock market will rise again.
It looks like the jumping has started
http://www.rt.com/news/313539-man-jumps-stock-crash/
And what would they buy USD with? Their rapidly collapsing currencies? Or by selling their rapidly collapsing commodities into a down global market?
"And what would they buy USD with? Their rapidly collapsing currencies?"
Yes, they print some more of their rapidly collapsing currencies or sell some PM or other assets (if they have any) or they declare default...
Money is Debt. Gold is Money.
http://www.planbeconomics.com/2013/03/money-is-debt-gold-is-money.html
Ironic use of the words "dump" and "treasurys" together, don't you think?
I don't own any (even though the gov-scum says I "owe" hundreds of thousands of thin air debt because fo them), but I would certainly take a dump on them. Or clean up a dump with them ;-)
Cuz a big fucking dump is all they're really worth anyways.
Until it all collapses, The Fed just prints more digits, creates more "Swap" arrangements with other CB's and has them buy more Treasuries such that there is always a ready Buyer for China's dumped Treasureies AND it can all be kept "Off Balance Sheet".??
China, as of know, has us by the balls. They own our debt. They (most likely) have more gold than us. We have a HUGE trade deficeit to China. We must remember that the coming coolapse is not China's fault. Our Federal Resrve and government got us into this mess. DO NOT LET THEM TAKE US INTO ANOTHER WAR TO GET THE BANKERS THEIR "OWED" MONEY.
We need people who are free-trade non-interventiaonlaist, not warhawks in our political offices. Trump wants us to ivade the middle east and take their oil!!! He wants to demand China around, even though they have the upper-hand currently. He wants to lockdown the country and bring us to more war.
Jeb, Hillary, Sanders, Carson, etc. all want more war. The wars are nothing but banker's wars. Don'yt let them implant your minds with thoughts that China is behind the coming (occurring) financial meltdown!
Of course there is ONE candidate (again) that is a free-markets, anti-fed, non-interventionalist, balanced budget, cpro civil rights kind of guy.
He has filibustered on drones. He stood up to the TSA. He has a plan to eliminate the IRS and balance the budget. He wants to end all foreign aid. He is a constintutionalist, which means CONGRESS, not the President has the power to declare war, he does beleive Snowden should be hung, he wants to audit and end the fed.
If you dont know, I'm talking about Rand. I agree with him on 99% of the issues. That's why I am donating half of every sale of my candles with silver coin prizes to his campaign: https://www.etsy.com/shop/ScentSavers?ref=hdr_shop_menu
Half the slae price of candle sold now through September 7th, will go to support Rand's moneybomb on September 7th!
End the Fed. End the IRS. End the Wars. End the Spying. End the drug war.
I agree with the Captain. Several Chinese friends I know told me they are moving out of their RMB holdings and into gold. Evidently in China you can buy gold through your bank and get a passbook just like a savings account except the bank holds the gold for you. Some of them are doing the 50-50 thingy buying 50% physical and storing it, and 50% passbook gold held by Bank of China or some other big bank there. But they are afraid of a 20-30% devaluation in their RMB cashola.
China's banks seem much more enthusiastic about gold then in the West and the Chinese gubmint encourages buying gold.
I wonder when the USA banks will start selling gold if ever?
Fear not, the Donald will change all this. Presumably by either passing laws to stop Corporations offshoring jobs (Which would result in the same Corporations moving offshore themselves) or by imposing large tariffs on imports from China (which would be against WTO rules and would lead to higher prices for most goods).
Yes, the Donald also said that he would impose a 35% duty on imports by FORD, should they build a factory in Mexico instead of in the US. Voters like to hear that, it's good for jobs. I only wonder how he would pull that off with the North American Trade agreement in place?
http://www.detroitnews.com/story/news/politics/elections/2015/06/16/trum...
"These fucking Jews are thieves, they are liars, they are mother fuckers, and it's time we took care of these bastards." - Bobby Fischer.
Ugh...you do not understand free markets. Its mainly the tax code and the fed that is driving jobs overseas. More regulations and tarriffs only mean higher prices for consumers.
If we greatly lower the corporate tax rate from the crazy 35% to be at least one of the lowest (most free) in the world, corporations would be flocking back. If we cut back on regulations that make it harder and more expensive to business in America, then our jobs would stay here. If we abolish the IRS and make taxes easier, plus give workers back some of the payroll tax, we will all have more money to spend on goods. If you end the fed, people could actually save money that stores value, instead of an ever decreasing dollar.
If only there was candidate that had a plan to do all this...Oh wait its RP once again!
Agreed to an extent but would you really vote for someone who fucked over his own Father, who is by far intellectually superior anyway? If he can't be trusted to respect his own Father, can you trust him? No, I didn't think so...........;
WHAT WOULD HAPPEN IF "TREASURY'S" COULD ONLY BE ISSUED BACKED BY EXISTING COLLATERAL?
Come on, ZH! Ask EYE-OPENER, JAW-DROPPING questions!
Please don't become a lapdog!
Hint - There is no treasure left to manage. They are issuing "plunders."
I gave you a 'greenie' because you are discussing the reality of the situation (NOT BECAUSE YOU ARE TRYING TO SLAM THE TYLERS FOR ATTEMPTING TO POINT OUT THE OBVIOUS IN A RHETORICAL QUESTION). Careful, Orange County.
WHAT WOULD HAPPEN if EVERYONE joined CHINA in dumping USTREASURIES?
This is a 'no-brainer'. You're fucked, they're fucked, everyone's a fuck-fucked. Carnage economically, followed by global thermonuclear war. Riots, martial law 'scenarios', wives whining about the fact that they can't buy tampons, unruly children punching holes in their bedroom walls because their I-phones stopped WERKING, Erin Burnett finally showing her A-cups in an attempt to gain viewership on PMSNBC, Cramer doing a public suicide, and A STANGE GLOW from 50 miles away followed by a shockwave that breaks all the windows in your tenamant building. Banks closed, credit lines suspended, Spics and Jigs running loose in gangs shooting 'whitey', Hillary masturbating and slavering, Draghi trying to escape with all the loot on Hitler's Gold Train, The 'rich and famous' banging on the iron doors of 'Crystal Palace' trying to get in, Stackers LAUGHING and CRYING at the same time (because they TRIED TO WARN YOU, but you WOULDN'T listen), and all kinds of stuff.
In CONUS, it's TEOTWAWKI. HERE is a video that will familiraize you with the REALITY of what IS happening:
https://www.youtube.com/watch?v=oIdPPVkkHYs
Quit talking TRASH about the Tylers.
I guess they did their job, though. They got YOU to wake the fuck up and LOOK AT THE REALITY.
Thanks. But the Tylers know I appreciate them from way back when when I amicably referred to this locale as cyber-delphia.
What I do not appreciate, and this is no fault of theirs, yours, or others, that peeps LOOK at reality.
I say, STOP LOOKING AND UNDERSTAND.
The difference is GAZING at totem poles or tearing them down!
MontgomeryScott, ZH, TEAR DOWN THE TOTEM POLES! (...pretty please with sugar on top!)
I tear them down, but I, you, and 'Tyler' are only ONE (individually).
I'll take it one further, though.
At the end of the day, I still STAND. I have set a course, and have not wavered from it (wherever 'the journey' and the Master of my Creation decides that I should travel to).
My 'understanding' is like looking in a dark mirror. The evils that I have comprehended and are being led to understand far outwiegh any philisophical arguments about the great 'what-if' arguments that are posted here (or on ANY OTHER websites, or in the global realm of human comprehension as you have been led to believe 'it is').
The comprehension of REALITY is but a cornerstone on what you describe as 'understanding'; but it is simply a stepping-stone of the various abilities that humans have at their disposal (if they are not too afraid or cowed by the PTWTB to take the next steps).
Cultures around the world, historically, have carved or etched symbols in dead tree wood to 'mark their worth'. Tally-sticks and Totem poles are but TWO examples. 'Hey, Mr. Tally-man, tally ME BANANA! (daylight come, and me want to go home)'.
Here's a little classical music from Harry Belafonte, to ease the pain:
https://www.youtube.com/watch?v=6Tou8-Cz8is
With understanding and comprehension of reality, responsibilities are heavy and apparant.
If you have not figured it out most of us are Tylers on ZH.
And together we stand more powerful than you might give us credit...as one.
We hone our fighting skills against one another so that we will be an invincible army against the Forces of Darkness when it all shall count.
We are anonymous. We never forget. We never forgive.
Long live Fight Club.
May God bless Montgomery Scott...a Tyler.
Huh?! It is not a question of *IF* it is a question of *WHEN* - and then you going to see what of a gigantic pile of treasury dunk will be dump'ed :)
And the *WHEN* is not far, it is much closer than most think. You think China's financial operations werent observed under microscope and disected by everybody in the last
months? You must be kidding :) ...
So instead of using the Treasuries to buy mines, ports, gold, oil, farmland, real estate, and technology, these imbeciles are pissing it away down a rat hole, burning it in their Plunge Protection Team operations? How fucking stupid can you be?
prolly' not stupid, prolly' necessity.
Gotta' find what is compelling this behaviour
The chinese are not stupid. They also buy ports (in Greece), gold, farmland in Africa etc., but they need to balance what they're buying against the possibility of civil unrest.
That means you can profitably sell the Thai Bath against US$, becasuse they will not be able to defend it indefinitely.
Their official objective is to implement an "orderly" depreciation of the Thai Bath. They are not looking at keeping a fix peg but to slow down and smooth out the depreciation.
Sorry to nit-pick: a "bath" is something anyone silly enough to still be in these "markets" will surely take. Sooner not later.
"Baht", THB, is Thai currency.
As satire (which you actually understood the concept of why they were calling a bath) flies over yer head.
Now go and earn ye some Monopoly Money.
"Then who is on the "buying" side of this massive liquidation of US treasuries?"
All the pension funds and US retirees who were forced to buy stocks for yileds will dump stocks and buy the treasuries. Remember China is dumping US treasuries not because they've lost faith in the US$ but to defend RMB and stem capital outflow. All the capital which flowed into China despite severe undervaluation of RMB when China was growing is now fleeing and RMB is getting trashed.
QE4 will be needed for this, the Fed spent $3.7T from QE2 and QE3 buying up US treasury bonds. 90% of all UST bond purchases in 2012, 71% in 2013, and 80% in 2014. Looks like they're going to have to gobble up a LOT more.
Thats apparently Belgium
"Possibility" of unrest?
The Chinese, though not alone in the insanity, have pushed "growth" to the max. Given that perpetual growth on a finite planet is NOT possible, then, surely, the track of growth can ONLY lead to "civil unrest." But... we KNOW that govts' big trick is to distract and blame others (pretty basic human behavior, one that's plenty exercised here too), and that this path culminates in a lot of blood spilling.
Given the game we're playing no one (or group) is necessarily "stupid." The stupidity lies with the game: the premise of perpetual growth on a finite planet is neverr questioned.
Which came first- the chicken or the egg? and is it "necessary" in terms of short term need or long term planning goals
Which came first- the CNY currency crisis or dumping UST?
On a long enough timeline, the egg had to come first.
1) China dumped its Agency debt to UST taxpayer bagholders (along with Russia and thanks to Hank P & his "term sheet")
2) China moved away from the long end of the UST curve
3) China stopped acquiring new short term UST even though their F/X reserves have continued to grow
4) China started the unloading of its remaining inventory (through the slant eyed Belgians)
Then we finally have a convenent "crisis" in appreciating CNY and falling equities
6) China acelerated unloading of its remaining inventory (with fear trade bagholders rushing to prop up prices for the Chinese)
What did Rham say about a crisis???
This is looking positive.
Russia, Egypt support forming anti-ISIS coalition with Syria - Putin
This is simple. When you need money, you sell shit that you have to get the money. I think the econ term is "liquidity". Treasuries are easy to sell for money. Easier than, say, an entire ghost city. What do the Chinese need the money for? What do most people need money for? Blow, hookers, and gambling debts.
It really is this simple, despite all the complicated jargon, graphs, and acronyms.
Except "you" don't have a printing press (or swap lines) and "they" do. This was their choice. Why?
You can get most of those things at a steep discount right, now, too.
Russian military? Pffffffffft. Other than nuclear weapons, I just don't see the threat. Name one war where Russian military equipment stood up to its western counterpart and won. I'm waiting........
Watch RT and their Speznaz competitions. Their soldiers are a joke. They look like undisciplined kids. They can hardly stand in parade formation. Also look at stories and pictures of those Russian servicemen killed around Donesk. Then watch our guys in Iraq, especially in Fallujah. Our army is battle tested, Russia, not so much.
the "correlation of forces" is a local thing with a time dimension, don't cha' know.
- Ned
Respectfully submitted for your approval, Mr. Styles:
One 'Nazi impersonator' who wishes the ZH readers to focus on an opponent who was beaten into economic submission in 1989 (the OLD CCCP/USSR).
The wish to re-live the 'glory days' in the guise of rallying 'patriotic support' within the controlled masses of the occupied States of the CONUS is still STONG in this one.
"LET'S DO THE TIME-WARP AGAIN!"
https://www.youtube.com/watch?v=4_4aWTAkCFY
'Dr. Who' evacuated the planet a long time ago, by the way. WE are METALUNA, now.
That went right over my head. No idea what you mean.
This humor right?
NO, it's NOT, unfortunately.
THIS is a paid government troll college student from HAIFA making his quota by posting on sites such as 'Zero Hedge', trying to talk total bullshit about the reality of the situation.
Ask this Zionist FUCK about the 'Iranian Nuclear Threat'; just to see if I'm wrong.
There are TWO factions working here on the internet. The 'Nationally Oriented', and the 'Non-Systematic Opposition'. BOTH are BOLSHEVIK, and BOTH are from the LOST TRIBES (Ashkenazim and Khazarim). 'Soft socialists' and 'Totalitaian socialists', but the goal is the SAME. MISDIRECTION and PROPAGANDISTIC DIATRIBE is their primary tool in the war of information.
HOW MANY THERMONUCLEAR WARHEADS does ISRAEL ACTUALLY HAVE, by the way? I wonder if he is an 'art student'; or if he works for 'Urban Moving Systems' and is just logged on to DOCUMENT THE EVENT.
Paying tuition and books perchance?
"Other than nuclear weapons, I just don't see the threat.".(per hellhitlery)........wtf....duh.we're talking earth splitting, vaporizing, 10K degree shock waves rolling down 5th avenue, vaporing everything in it's 10 second 500mph blast path. there are not going to be any 'conventional' wars anymore, sorry. we've bulked up on ALL of this military little shit just to make the MIC and the politicians rich. get a grip, and fuck off.
Is this a threat? http://www.rt.com/news/313537-russia-egypt-putin-meeting/ To the ZWO? I hope so. Real Hope and Change?
A threat to the ZWO? Doubtful. They are probably covertly in on it. Lots of Russian "Jews".
That is the message the zinos want the masses receiving. I'm sure they appreciate you doing your part.
"Name one war where Russian military equipment stood up to its western counterpart and won."
Vietnam. AK vs M-16
WW2. T-34 vs Panzer
Cold War. Tu-95 vs B-52
Now. S-300 vs Patriot
The Patriot? You can't be serios McCormick? I would take a M-16 or M-14 over the AK but really why bother with them when you can own an HK 91? The Patriot is the poster child for a failed weapons system.
T-34 vs Panzer? Ever hear about Kursk McCormick? If US tanks are so great why does everyone want to buy a Challenger?
Hillarious! That worked out real good in Afghanistan didn't it. 9000 hectares of poppies "the stick" is guarding for NATO.
It's the 'ole he's heavin' while you're hoein', catch-22 type a thing!
High speed computers modulate the process to maximize Der Peoplesfucking.
ACHTUNG!
Das 'computenmachine' ist NICHT fer 'Gerfingerpoken' unt 'Mittengrabben'. Ist easy SNAPPEN der SPRINGWERK und causen POPPENCORNEN mit SPRITZENSPARKEN. Relaxen, und watchen das 'blinkenlights'.
(A sign posted on the Acroloc CNC milling center that I set up and operated while making the experimental titanium gunbolts for the then-in-development AH-60 'Apache' helicopter's 3,000 RPM 'gatling gun', in Torrance, California)
P.S.
The Okuma CNC lathe was a MUCH-BETTER-BUILT machine.
Guarantees world war in many facets as we are already witnessing and with all war; more innocent people die.
Wouldn't rising interest rates on US debt cause capital to flow into treasuries? Which would somewhat offset the increase.
If US interest rates go up then so will Europe and Japan and China and everyone else.
The whole shit pile is connected.
I have a head ache.
possible but given the recent fear there really is no alternative for scared money..TLT to the 50 day around 120 if not 115ish
"The Kids Aren't Alright"
http://gawker.com/today-stocks-were-way-up-because-the-stock-market-is-p...
#micdrop
Its going to be really tough to get buy-in for the next bull market (like Japan) when the false volume has gone mainstream.
I wouldn't worry one bit about that, people in general are idiots with exceedingly short memories and the second the hypists start selling new and "advanced" ways to look at things they will lap it up. Look at the housing bubble echo, everybody has already been hit once... completely forgotten.
Yeah, but there are seemingly less and less contestants for propping up any meaningful bubbles: Japan was exhausted a long time ago; China is starting to exhaust; the US has only been able to continue because of the USD as world's reserve currency.
I mentioned this years ago, that the concentration of wealth would be narrowed and that moves would cause larger and larger sloshings until the gyrations became totally out of control and it all collapses.
" . . . get buy-in for the next bull market . . ."
Non-sequitur?
How about a "steer" market?
I'd rather live in van down by the river than be involved with this casino, in fact, I may have to do just that because this obama economy is just so awesome.
Yore raycess cuz it busches fault
Better hurry yo! Me and my crew already got that beachfront van space sewed up. You can park by the mud flats, but I hope you put a winch on that van.
Make sure the EPA isn't working upstream.
I have seriously considered an A-class RV as a home. Cheaper, no property taxes, tax deductible, mobile and even self sustaining if you put some solars or wind on it. It does depreciate but not so badly.
You are better prepared for a Mad Max, Book of Eli, apocalyptic future. More importantly it feels like freedom and fewer government claws in you.
Totally have given thought to this. A diesel pickup with a big RV trailer. Still would get like 20MPG. Those big RV trailers are WAY nicer than the average NYC apt.
Read Travels with Charlie as a kid and it stuck with me. That and Mr. Mac Daddy Charles Kuralt!
Granted, as a mostly static home that can get up and go would tend to make sense, but...
If you have to relocate something this big you're most likely going to be traveling down govt-controlled roads. You'd also be a big target (plenty of folks would see you as such). And if you get a flat tire?
Not sure how folks figure 20mpg out of one of these things.
As a stationary home they aren't very efficient. Smaller area for sure, but heating and cooling still requires a fair amount of energy.
Don't get me wrong, I've had such thoughts, if it pencils out for ya then great! (but be sure to be realistic)
notice...performance of precious metals
We did and it's just like 2008....
I'd buy at 800
So you are saying you'd rather buy historicly inflated, massivly overvauled stocks with the worst fundamentals in 100 years, rather than majorly under vauled PM's with very tight supply and decreasing production? Interesting logic.
A lot of people would. Including those who have been waiting for the better part of 7 years, while they continue to call for $650...
You'd mean silver, right? ill be glad to sell it to you.
You'd mean silver, right? ill be glad to sell it to you.
I'd say, "We're in the pipe 5 x 5..."
As John Williams predicted a panic selloff of US Treasuries, aka, the US Dollar, will start hyperinflation...in the United States.
You missed a step in the middle involving the US military.
US military is way overrated...
It is also a good thing to remember that it wasn't so much the US military which won WWII as the US manufacturing industries, which allowed America not only to supply its armies and to replace their lost equipment, but also support its allies too, unlike German and Japanese manufacturing...
The Red Army won WWII in Europe...
With Chrysler trucks. Without lend lease equipment (trucks, planes, etc.) they would have lost. BIGTIME
You need to come out of your self-induced coma. The German eastern campaign was fucked from the moment Hitler focused on Moscow instead of on the Caspian oil fields. Leningrad was a bleeder, but Hitler wouldn't let go. Had he concentrated on reaching the Caucasus, he could have cut Stalin off from the oil and then attacked a frozen Soviet war machine at his leisure. Oh well. Hitler was a genius. Until he wasn't.
Yeah. I guess Chrysler was a superior product because the Germans were armored with Ford and General Motors products...built by the slave labor in the Concentration Camps.
Not only did we arm our allies.
We armed the enemy also!!!
(The dirtiest little "secret" of World War II.)
Yes IBM was responsible for tracking the Jews. Standard Oil kept them supplied from the Oil Fields of South America.
And as iwo time Medal of Honor winning, Marine Corps. Major General Smedley Darlington Butler said, in a book he published BEFORE WORLD WAR II, WAR IS A RACKET.
And the American Industrialist profitted handsomely through the untold loss of life and absolute carnage and destruction during the war, and in the aftermath.
And here is a book, by Antony C. Sutton, which you can read if it pleases you to FIND OUT THE TRUTH.
http://reformed-theology.org/html/books/wall_street/index.html
It's also good to remember the Soviet Union won the war in Europe starting with Stalingrad before the US could get up to speed. Stalin was playing around in the Balkans and Baltics grabbing turf waiting for the US and Brits to come in and grab their turf per agreement (and was getting impatient).
Wrong - please read some history.
The most horrifying trait of ignorance is the impossibilty of the ignorant to realize and understand that they are indeed that.
http://acepilots.com/planes/p39_airacobra.html
Between 1942 and 1944, Soviet ferry pilots flew approximately 2,600 P-39s into the USSR from Fairbanks, Alaska. Another 2,000 were shipped (crated) to Iran, assembled, inspected, and flown to Soviet bases east of the Caucasus Mountains. The majority of the 4,600 P-39s shipped to the Soviet Union were the highly developed Q-models.
https://en.wikipedia.org/wiki/Lend-Lease#US_deliveries_to_the_USSR
In total, the US deliveries through Lend-Lease amounted to $11 billion in materials: over 400,000 jeeps and trucks; 12,000 armored vehicles (including 7,000 tanks, about 1,386[26] of which were M3 Lees and 4,102 M4 Shermans);[27] 11,400 aircraft (4,719 of which were Bell P-39 Airacobras)[28] and 1.75 million tons of food.[29]
Please check the date for the battle of Stalingrad. Thanks.
True dat. Don't confuse Hillary here with the facts.
Today's military is fading. New stuff is imigrants. Supported by shit fake 2 party fraud.
You missed a step in the middle involving the US military.
Or bring back a whole lot of manufacturing jobs - as it becomes cheaper to make it here VS pay for it in Yuan or bat or pesos.
Many countries survive selling stuff to the USA - can the USA have hyperinflation while the rest or the world is in a massive deflationary spiral?
They could go to gold (phyisical and paper). They could buy paper gold and force delivery. That would speed things up a bit.
There is no "forced delivery". If they don't have it, they settle in FRNs. If enough people don't lime that, they crash the broker, a la Jon Corzine's MFG, followed by PFG a few months later as an exclamation mark.
The Hunt Brothers tried to force delivery of silver in 1980. Then the rules were changed on them: Sorry, liquidation of positions only, no more delivery. As a result, silver went from $50 to under $5.
Warehouses and munition dumps
would start exploding all over the world.
Its all relative to how many of the those multi ton 20 foot long solid tungsten Rod-From-God things the US has up there.
what would happen if everyone in China jumped in the air at once?
You can't "go" anywhere, if you have no reserves to invest.
When a country is in crises....cash is king.
Gold is one avenue used as protection of one's stored work against the perditions of wonton printing.
primary dealers will buy the lot
primary dealers will [continue to] buy the lot
More false flags until JH can usher in martial law.
nothing would change. Japan buys all of theirs.... Fed can print MOAR!!!
Game Over.
I would like to see how this impacts US pension funds viability.
Tried to tie this premise together with the movement on the 10 year this past week.
http://tothedeathmedia.com/is-the-flight-to-safety-in-treasuries-really-the-result-of-fed-mopping-up-chinas-dollar-dump/
BLICKS soak up treasuries for the Fed, and Swiss buy stocks. Nice scheme until the world rejects the dollar.
Dovie'andi se tovya sagain (It's time to toss the dice)
The Daily Economist
Alea iacta est. The die is cast.
What is that in Pennsylvania German?
Pennsylvania Dutch, Chicken Pot Pie. Shoe Fly Pie?
...am feeling way overdue for a take by Jim Willie...
Subscribe to the Hat Trick Letter; i do. In the August edition "The Voice" stated that people are in for a very rude awakening in the very near future. Both have recently stated that this totally implodes by the end of Q1 2016. At the pace we are at; it appears this to be plausible, but remember this is truly surreal, for apart from knowing the truth, we are left in the framework of conjecture. We have moved from fixed truth to a place of surrealism.
What does it matter when the Fed can print another few trillion and own them all?
In addition to soaking up DOW losses? All your shit is belong to us. There is no point in charting anything, unless it is for posterity's forensic investigation of whatever is coming. This whole mess is like playing chicken, after you already wrecked.
Exactly! I was looking for this idea in the comments. If you think the Dow is protected, it is peanuts compared to the U.S. bond market. Most analyses show that about a 2% rise in bonds/debt costs will bankrupt the USA. There is no way the Fed or U.S. government allows this.
The Fed would take virtually all bonds onto it's balance sheets.
Look, home loans and everything else debt related, including credit cards are related to bonds and the prime rate. Move it one point right now and everything crashes at omce.
The need for a Treasury buyer besides the FED has arrived by the "scare-down" in the markets and flight to "safe haven". If China keeps dumping, the the markets will steadily decline; this appears to be intentional as the rigging can work up or down.
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To take over the world you need to enslave people first, by real war, by financial war, and by debt. There is a reason that there world population is correlated to world debt. As debt expands the population will expand and as it declines the population declines. We will see a massive decline in both when critical mass is reached; we are not even close to that in $$$, but in time we are getting closer. If you are without the love of Christ, then you are just poor. blind and naked without any purpose or meaning to your life and you live in a world called "surrealism"; have you noticed?
Dow rockets up on the days that China is reportedly dumping treasuries. Guess where those US dollars are going?!?!
The Chinese government will in the future be a historical example of the ignorance of communist central planning
Already is an example of central planning ignorance in my book.
Everyone has a plan until a couple billion people take to the streets looking for someone to hack with a machete.
This is such gibberish...sounds like CNBC or Fox.
I am very good at cutting a door and exiting the empire. The critters see the door after I exit, weld it shut, and make sure no one else employs that method, without being caught and made an example of. You have to make your own exit.
Denver Water Votes To Keep Adding Industrial Waste Fluoride, Ignores Natural Fluoride Difference
... all voting conducted on Diebold machines. Quiet, citizen! Drink, drink the pure, pure water. Mmmmmmm!
Precious Bodily Fluids.
Mixes good with mox, et al.
- that really sucks.
Here's a link https://youtu.be/a5_KmB9_fao to an actual video hidden camera look at what the "fluoridation" process actually looks like when adding these poisons to a municipal water supply, Austin, Texas. Sick.
The other poison they add to water is chlorine. The people not fortunate enough to be so poisoned die from water borne infections.
And yet the USD keeps going higher and stronger. I thought collapse was the other way.
/s.
They fed would buy them for pennies on the dollar and that would be that.
Recent treasury auction with low interest implies demand is still good.
OK, I'm slow. If I sell something that means someone bought it - right? So...what's the big deal? What am I missing? Obviously it's not as simple as I think...it should be.
The question is,; With whose money?
In that door. Go in that door.
Bloodbath -
And not even the Sandy Hoax or Boston Marathon type but a VERY real one with dead 401K and IRAs lying dead everywhere.
I started seeing something I didn't like in USTs. Including the Fed today saying no hike and it went down and right back up (interest rate wise). I took this as a warning and used the strong dollar to place my entire 401K in Global equities. Sorry, I know but my new 401K has only 6 real choices and this was the best of them.
Put it in a stable value fund with 2 year or less treasuries etc. for the moment.
The question isn't what other countiries are going to sell their FX holdings, it's who is going to buy it? The Fed?
GS will lend JPM a trillion, JPM will buy USTs and sell to fed for 1.1T, and vice versa, and so on, and then they will do it again, repo the USTs and buy the SnP with the cash while still "earning" the UST interest. then pay very large bonuses.
sorry
I thought the headline read "Dumpling Treasuries"
and I said, "Yeah count me in."
Deconstruction of the Petrodollar.
Only after the nuclear winter.
What would a solar (alternative energies) dollar be like?