*China considering dropping U.S. Treasuries and Buying Gold Instead*Very Important News- Implication

Originally posted by questioningall

Now that situation is changing. The red line has a slight negative trend, meaning the rate of acquisition of U.S. debt by foreign institutions is slowing. At the same time, the blue line is developing a positive slope. That means Federal Reserve is now buying, or monetizing, U.S. government debt. The situation may change dramatically if the “Buy American” requirement angers foreign governments, causing them to buy less U.S. debt. Remember, the money they use to buy U.S. debt comes from trade.

above from link:www.kitco.com...

The money don't come just from trade -- that's just less than one third of the source. If a foreign country purchases large amount of US Treasuries by paying with money from the trade means that a trade deficit exists between that foreign country and the USA. In case of the trade balance between China and the USA, the USA was running a $256.1 billion trade deficit in 2007.
www.epi.org...

But in November 2008, China held $681.9 billion worth of US Treasuries.
www.treas.gov...

There is no way that the trade deficit would increase by some $400 billion within one year when it increased from 2006 to 2007 by only $23.7 billion.

Buying US Treasuries means buying USD to make the purchase and that helps to keep the US currency in demand.

link: www.kitco.com...

This is a good information piece, about other countries and what they are doing.

These are countries the U.S. has relied on in the past, to fund our debt. But it looks like all of them are turning away.

reply to post by questioningall


I am not sure about this. I own a business and my products are all made in china. They have asked for a raise in price 5% early last year but I still have not paid the 50% balance due in a large order I received 2 weeks ago and they havent said a thing about it to me.
I would think if our dollar was tanking and china was pulling the trump I would at least get a email saying hey, wire those funds fast.

Just a thought.

Originally posted by Wormwood Squirm
Has anyone considered that this may be a conspiracy to rob the Chinese of their wealth?

Doesn't the US have a secret stash, a monstrous unknown amount of gold? Fort Knox maybe?

If the Chinese buy up a big whack of gold thinking and believing the gold to soar in price when all of a sudden the US says OH ya, we have 2 Quadrillion worth of that medal.

Then what happens to the Chinese gold? ROTFLCOPter

They'll wish they kept the US dollar.

This whole shenanigan could all be by design with the ultimate goal of getting rid of the Chinese money threat, space threat, global power threat etc all in one huge scam.



[edit on 30-1-2009 by Wormwood Squirm]

Couldn't agree more. Just like they did to japan and the arabs in the last two bubbles. The US is going to pay everybody including pensions in cheap money. Smart those boys. Oh yah and you gold bugs best watch out there going to get you also. good luck

I even have taken my 9 year old daughter's money out of the bank, and have purchased metals with that for her. I explained - that it was in her best interest and how it will increase, which it already has. She has trusted me, I have been trying to get all my family members to put anything they had extra into metals, I am thrilled they have listened to me, and have made decent purchases.

Questioningall I can't believe you've done this irresponsible act.

If you really knew what you were talking about you would have taken all your money out of the bank when Gold was languishing around $360 per ounce a couple of years ago.

The very worst time to buy Stock or Gold is when the price is rising. The price of Gold will crash again and you will lose all your savings. The Gold price will not rise forever.

The only reason anyone is screwed by China buying gold is that it is taking money out of productive investment. To create growth it is not the quantity of wealth in an economy which matters. It is the speed with which money circulates and how frequently wealth changes hands. Locking wealth up in buying Gold whether it is individuals like you doing it or whole nations like China... it is simply destroying jobs and destroying wealth. Your own actions in buying gold are part of what prolongs this crises.

May I remind you Questioningall what happened when Russia began selling gold into the world market in the early 1990s?

The funniest thing of all would be if Obama started selling off US treasury Gold into the world market to re-inflate the economy. What would happen to your savings then Questioningall ?

[edit on 8-2-2009 by sy.gunson]

the thing with the gold price is that it seems the Big financial investment house JP morgan can LITERALLY take down the price of gold thru simply doubling down on it's NET short positions in Gold Futures......the figures that have come out thru at least 3Q 08 show that there short position in gold futures.......at least this is what i am leaning toward at the moment

www.321gold.com...

Gata seems to think it's smells and quaks like a duck

www.gata.org...

[edit on 8-2-2009 by cpdaman]

Exactly ... you have as much chance of riding out the economic storm with gold as riding down the Colorado rapids on an inflatable Lilo.

Actually this trading unfortunately is an example of the same type of market manipulations which brought about the sub prime market collapse. Yeah okay slightly different scenario, but the way money, gold or property was turned into a commodity and then speculated over was the root cause of the problem.

The capitalist system needs to get a hold of itself and realise that financial markets can't be allowed to run free like the wild west.

Matter of a fact how are the prices in other metals

Silver, Platinum, Palladium, Rhodium, Iridium, Osmium, Ruthenium, Cooper etc.

You know what would be funny is that if while everybody is buying gold one of the another metals rise and then gold falls that would screw not just people but states.

reply to post by sy.gunson


I have studied and watched the market, and unless you are living in a cave, then the only way right now, to preserve the value of the dollar as it stands right now is by buying metals.

It is NOT irresponbile at all, to take my money and my daughters money and preserve it!

SO DO NOT say I am something...... when actually YOU ARE IRRESPONSIBLE for not taking steps to preserve your own investments!

Well, I don't have any cash reserves to buy gold .. so I think I'll take my little bit of money that I can manage to save and buy tons of chocolate. Then, when all you folks who did buy gold want chocolate and no one else has any because the economy has crashed and it's all gone to hell I can sell you an ounce of chocolate for an ounce of gold!

Seriously though, there's no way to really know exactly what's going to happen. IF America becomes "insolvent" we're in for some seriously rough times.

reply to post by cnichols



Hey, I already thought of chocolate!!

I have a "full" shelve of the good stuff, can't be caught in a bind without chocolate!!!

I am serious too!!!! I bought a ton of it already!!!

reply to post by questioningall


Darn right! Life without Chocolate is ... unthinkable!

Chocolate and COFFEE! Gotta buy that up too.

Sorry, didn't mean to hijack the thread with sillyness. *blush*

But seriously, we need to get ready for this. FOOD will end up being a huge commodity in the good ole US of A if things really do collapse.



[edit on 9-2-2009 by cnichols]

reply to post by cnichols


Yeah, got the coffee covered too, of course i have the "most" important items needed!! LOL I will sit back now.

Originally posted by questioningall
...we are literally and completely "screwed" here in the U.S.!

Well there certainly has been a HUGE increase of commercials, even internet spam, begging people to send their gold and recieve cash. Nothing like trading something of actual value for funny-money.

It reminds me of the old O.T. days when the Jews were pulling out of Egypt. I wonder who is "pulling out" of America(but not without the gold secretly hidden in the homes of millions of old sheeple).

It's becoming real. Chinese citizens are in a gold rush now.