…in the course of responding to a linked Fallows piece in the
Atlantic in comments at Ezra’s I ran across a very intriguing chart
Fallows was putting out the standard line: We buy toys from China,
China turns around and finances our deficit, ultimate end result
trainwreck. Well oddly enough the numbers don’t support that at least
for FY2007. Our key Asian import trade partners were not net buyers
of treasuries. In some cases they were very large net sellers.
Country Nov 2006 Nov 2007 $Change
Japan $622 bn $580 bn -$42 bn
China $393 bn $386 bn -$7 bn (-$34 bn since March 07)
Taiwan $59 bn $49 bn -$10 bn
Korea $64 bn $41 bn -$23 bn
Korea liquidated a full third of holdings and no one noticed.
Who bailed out the market?
U K $76 bn $315 bn
Oil Exporters $106bn $127 bn
Brazil $52 bn $120 bn
I’ll try to get a piece up on my site. But to say that this swing is
under reported doesn’t begin to touch this. At this rate we are only a
month from having the UK replace China as second largest holder of US
Treasuries. The world looks a lot different when your future
financing is the hands of the Bank of England rather that the various
central banks of Asia.
This one by Bruce Webb.
rdan here. Bruce became involved in a project on Social Security for a candidate so has not developed the post. I am posting this as a good catch.