Premium"The Other Canada": Is China Hiding $600 Billion In Treasuries North Of The Border?
For the better part of a decade, the chart of China "dumping" Treasuries has been a staple of every "Sell America" pitch deck.
There is just one problem: the money never seems to actually leave. According to Bloomberg, a growing number of investors and strategists now suspect that Beijing has been quietly moving its US paper to non-US custodian banks, where it no longer shows up as Chinese in the Treasury's data, and that the most popular new address is... Canada. Which, for those keeping score at home, is the same trick China pulled with Belgium in 2014, as regular readers may recall.