The United States has another big operation? The "Ponzi scheme" is about to reappear.
As of the first quarter of this year, the United States has sold more than $7 trillion in bonds, which means that the United States has taken action to solve the debt crisis.
But at the critical moment, China made a move, in order to get rid of the dependence on the dollar as much as possible, and sold tens of billions of US bonds in a row.
U.S. debt soared
U.S. debt does not appear overnight, but accumulates over many years, especially in the years of the epidemic, which can be described as worsening the debt crisis in the United States.
At that time, the epidemic suddenly swept the world, and all countries worked together to resist the disaster, but looking at the United States, they did not take it seriously, but allowed it to spread, and even some places were not controlled, and the number of people in the United States died due to the new crown virus in 2022 alone.
This inaction has directly led to a precipitous decline in consumer spending power, and corporate profits have been declining year after year, which has affected the decline in stock prices, and the U.S. economy is inevitable under a vicious circle.
However, it seems that the United States has never taken the usual path, and even in the midst of various crises, its international position has not changed, and it has even played a very good role in dealing with debts.
However, it is often a matter of dismantling a piece and making up a piece, which will not solve the problem at the root. As far as the epidemic is concerned, in order to get rid of the economic crisis as soon as possible, as an international big brother, it has come up with a "bad move", that is, to print money frantically to let others cover the bottom and use other people's money to fill its own economic loopholes.
As we all know, although crazy money printing seems to be able to temporarily solve the country's economic problems, but behind it is a series of debt problems, but for Lao Mei, solving the current problems is the top priority, so even if it knows it, it can only do so.
In order to attract more people to participate in it, it will keep the interest rate on US bonds at 5.5%, which is indeed tempting, and many people will buy US debt when they see such high interest rates in an attempt to get a piece of the pie.
Although this method is effective, the United States still faces a big problem, that is, how to achieve rapid economic growth in a short period of time, otherwise the interest on these US bonds will be enough for him to drink.
It is said that the interest on U.S. bonds alone can reach the trillion-dollar level, and according to U.S. financial data, since the second half of last year, the growth rate of U.S. bonds has increased by almost $1 trillion every 100 days, and now it has reached $34 trillion.
It is conceivable that if this trend continues, the US debt will be like a big snowball, rolling bigger and bigger, and what will happen by the end of this year, and it is inevitable that the United States will "return to the old business" in order to solve the problem at present, let the dollar depreciate, inflation, and another wave of leek cutting behavior.
Among them, the mainland, which holds the second largest number of U.S. bonds in the world, is the most worried, so it sold 22.7 billion U.S. bonds in a row at the first time.
Pick up the loyal fans
According to U.S. financial sources, after China sold off 22.7 billion U.S. bonds, compared with last year's data, China's holdings of U.S. bonds have dropped by nearly half.
It can be seen that the mainland has gradually shaken off its dependence on the US dollar as much as possible, and the selling of US bonds can be regarded as one of the acts of countering the US "riotous operation".
But China's move has undoubtedly made the United States unable to sit still, and Yellen's visit to China in early April discussed the issue of financial stability at a deep level.
However, in consideration of various factors and in order to safeguard the interests of the country, the mainland did not follow its routine, but chose to sell off and gradually get rid of dependence.
It cannot be ignored that the United States, as the largest country, also has its own "loyal fans", especially Japan, which has been one of the countries since June 2019, when Japan purchased more U.S. bonds than China, and during the period of China's sell-off, Japan also participated in the acquisition of U.S. bonds.
Judging from the current debt crisis in the United States, it is not that there is no oil or water to be fished out of becoming the most successful receiver of the United States, and in serious cases, it may be a victim of inflation.
However, as everyone knows, Japan has been overly dependent on the United States in terms of politics and security, and with the rapid economic growth of the mainland, it has retreated to the third place in the world in 2010.
In order not to let the yen become a piece of waste paper, he can only continue to take over, and in order to continue to rely on the United States in the future, he is willing to be the unjust leader to help the United States resolve the debt crisis.
But it is worth mentioning that Lao Mei's current debt is more than 300 million, and Japan only holds more than 1 trillion, so it has no ability and cannot become the last big man.
Japan is followed by the United Kingdom, but with its current economic strength in a state of decline, it is completely impossible to bear the 3.4 billion US debt of the United States.
So who will be the biggest taker?
The biggest pick-up man
The only possibility to clean up the mess for the United States is the Federal Reserve, which holds up to 900 million in US debt at most, which is higher than the total of other countries.
According to relevant news, in the first quarter of this year, the United States has sold as much as 7.2 trillion U.S. bonds, compared with the operation of previous years, which undoubtedly makes countries panic.
Most of them are worried about whether the United States will come to "cut leeks" again, using other countries' money to plug the big hole in their own country, until they see the depreciation of the Japanese currency, as if to warn the world.
But I know that the more US bonds are acquired, the more I will be able to get rid of my dependence on US bonds, but after all, the US dollar is a global currency, and no country can bypass this link, which is why the United States can manipulate the US dollar at will.
Because of its turmoil, Japan has become the first victim, and although there are dissatisfactions in various countries, they are powerless, and the United States is a precedent for suppressing the euro.
However, fortunately, the mainland has been working the road of "de-dollarization", although I am not sure what the future will be, but fortunately, it has begun to gradually get rid of the dependence on the dollar, and I believe that the renminbi will shine in the international community in the future.
The author thinks
China will never be at the mercy of others, and when it encounters problems, it must fundamentally solve them, and it will never tear down the east wall and make up for the west wall like the United States did.
Resources:
China Economic Net--2024-04-19
US media: US Treasury bonds are becoming more and more difficult to sell
Observer.com--2024-04-18
China's U.S. bond holdings are close to their lowest level since 2009, and Japan has increased for five consecutive months
Sina Finance--2024-04-18
Foreign media: China sells $22.7 billion in U.S. Treasury bonds, and Japan's holdings increase