Russia May Swap U.S. Bonds for IMF Debt

June 10 (Bloomberg) -- Russia may switch some of its reserves from U.S. Treasuries to International Monetary Fund bonds, the central bank said today. The comment drove Treasuries and the dollar lower.

Alexei Ulyukayev, first deputy chairman of Russia’s central bank, said some reserves may be moved from Treasuries into IMF debt, reiterating comments made last month by Finance Minister Alexei Kudrin. Ulyukayev’s remarks were confirmed by a Bank Rossii official who declined to be named, citing bank policy.

Treasuries fell, pushing 10-year yields toward the highest level in seven months, in response to Ulyukayev’s statement. The dollar fell against the euro on speculation that Russia will reduce its holdings of U.S. debt.

Bloomberg Article


We are starting to see the cracks in the foundation of the dollar now, as I am sure most of you are reading about. Russia and China are both now considering swapping their Dollar reserves. And many nations have cut back on how much they are purchasing in treasuries. Hence the Federal Reserve printing money and buying our own bonds.




[edit on 10-6-2009 by johnny2127]

Dont understand why this is bad?

The problem is that we need external financing and the only means by which we can force foreign interests to do as we wish is to remove some of our 6,000 nuclear weapons and point them at somebody.

Sadly, some governments (cough-China-cough) have created economic systems that are absolutely dependent on our idiocy. Those economies incapable of consuming their own production have become inextricably tied to the credit junkie - US!

The dynamic here is interesting in a macabre sort of way, and unfortunately "barbell" sorts of systems tend to only look stable - they aren't, and any disruption to the status quo has a nasty habit of showing up "fast and vast".

Whether Russia is a warning shot or the first crack in the dam that leads to a clean break and crash in the Treasury market is an unknown, but this much is certain - in terms of mortgage rates, which were sold to everyone as the linchpin of any economic recovery, Bernanke and his merry men have one again had their projections and intentions turned into a bad joke - a joke that, unfortunately, is on you.

Market Ticker

In short: The US is a company. Foreign investors put money into that company (via treasury bonds). When the US doesnt look like a good investment anymore the investors pull their money out and put it into another company (IMF in this case), leaving the US in shambled, bankrupt and insolvent.

In short short: We. Are. Screwed.

reply to post by Tentickles


Exactly. We are up the creek and trying to borrow money from China to buy paddles. LOL

One more link about this:


Source

America is only standing because of the criminals at the fed just printing any amount they want.

There plan to take over the whole world with the usa has failed, for the most part and they spent america into oblivion.

reply to post by andy1033


Agreed. That is just putting things off, but also in the long run will make things worse.