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The most obvious play in recent geopolitical/monetary history:
Safe [Chinese FX management] began to shift the composition of its dollar-denominated portfolio in 2017 and the pace picked up after Russia’s full-scale invasion of Ukraine in 2022. Even though Moscow had reduced its dollar-denominated reserves since annexing Crimea in 2014, Chinese officials saw how easily Russia’s overseas dollar assets were frozen — and worried that, in the event of a serious confrontation with the US, China’s much larger holdings could face a similar fate. 
and, according to two scholars at Tsingua University quoted in the FT piece
...the freezing of Moscow’s overseas assets “is a stark reminder of the financial hegemony the US wields through the dollar-based international system”, and that “the lesson for China is clear”. 
Background:
As overseas consumers spent trillions on the manufactured goods pouring out of China’s factories, the dollars that flowed the other way were often recycled into Treasuries — helping Washington to finance its budget deficit.

"Beijing’s heavy exposure to dollar assets is a legacy of its export-driven economic boom and decades-long trade surplus with the west."

And this:
Between January 2022 and December 2024, China cut its official Treasury holdings by more than 27 per cent to $759bn, US Treasury department data shows, far outpacing the 17 per cent decline between 2015 and 2022. 
A slow de-dollarization (of FX reserves #946143 and #747181) but a de-dollarization nonetheless. Some of that has moved to owning agency bonds (Fannie/Freddie bonds) and to owning bonds via Euroclear/Clearstream so not quite moving away from the dollar but still a reduction in monetary confidence.

But officials with knowledge of Safe’s workings say the agency does not regard massive dumping as a sensible option, preferring a gradual transition from Treasuries to other short-term assets and gold over a period of years.
Also, this is more worrisome than any sort of covert Chinese decoupling from dollars:
Any aggressive selling of Treasuries could be quickly neutralised by the Fed, which has a full set of tools including emergency quantitative easing to stabilise prices and push yields back down. 
i.e., Fed printing the difference. ugh.
As an aside: as if Europe didn't have enough financial and Ponzi- pension-related problems... (#968945)
The problem has always been where to go:
A familiar problem with China’s diversification attempts is that even significant asset classes such as Japanese, UK or German government bonds cannot match the vast liquidity of the Treasury market.
At the very end of the piece there's a short mention of gold, which forms a larger share of Chinese holdings than before (but still single-digit percentages). The orange elephant in the room is #bitcoin, which isn't mentioned. I dunno, man: all the roads lead here eventually. Welcome Chinese monetary expats.

If only there was a globally neutral asset, designed to increase in value forever and that had infinite liquidity to pile into, and that nobody could seize or prevent you from using.

Surely somebody is pitching them this, yes?

I liked this part of the text...
"A familiar problem with China's diversification attempts is that even major asset classes, such as Japanese, UK, or German government bonds, can't match the massive liquidity of the Treasury market."
That's quite true, although the Chinese add their intelligence... their discipline, and they're certainly hitting the nail on the head in their quest to eliminate dependence on the dollar!! And establish their own currency and have control... That control that, as a superpower, you must have if you want other countries to continue to see you that way...!!
And although the Chinese aren't completely out of their depth yet... If they continue their path in Gold, they're headed in the right direction...
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they might discover bitcoin by accident: more and more gold and then, "hm, what if we wanna send it around... maybe there's something else we can use??"
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So true, cowboy 🤠.. All roads lead to the burrow 🍊⚡
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The runup is going to be insane. I know a couple of small poor countries are accumulating, but maybe once the American states begin filling up their bitcoin reserves the larger nations will really take notice.
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Irrelevant aside: Roswell is a real shithole.
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The liquidity advantage the USD holds is largely derived from its dominance in trade payments. USD is required to be held by all central banks in order to participate in SWIFT and enable trade payments which are still mostly denominated in USD. Japan, Europe and the UK are all militarily and monetarily subservient to the USA. So, China is building its alternative to SWIFT and its partners are preparing their capacity to participate in mBridge. MBridge itself is already operational but the official launching of it is where this trade war steps up several notches and the risk of direct military conflict becomes much higher. China and its allies are increasing their strength as that of the US empire declines, but timing is still a crucial factor. Bitcoin, unfortunately has close to zero chance of adoption by the Chinese government - western Bitcoiners might like to think it could happen but they do not understand the absolute conflict between Bitcoins founding principles (individual 'rights') and the ideological basis of the Chinese governments ideology - collective state power projection. Bitcoin does deliver superior monetary performance to an individual participant but in that delivery it deprives the nation state of its fiat monetary and CBDC monetary leverage- that is something it would make no sense for the CCP to adopt. This is something Libertarian Bitcoiners clearly struggle to understand. Just as they fail to understand their individual wealth and privilege is based upon the global hegemony of the USA via the USD and the fact that nation states ability to project power via military and monetary organs is hugely determinant in the wealth of nations. Libertarians remain mystified regarding Chinas and its mixed economy where the state regulates capital issuance and allocation and how it has already won the trade war with the wests decadent rentseeking crony capitalism where private capital owns and directs their governments. When trade payments shift to the digital mBridge protocol then liquidity dominance also shifts to the Yuan, as Chinas dominance in trade is then also shifted to dominance in trade payments and liquidity.
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All roads may not yet lead to Bitcoin, but you can definitely see it on the GPS
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