Foreign Banks Dumping USD?
The chart below illustrates that Foreign Banks led by China and Saudi Arabia are busy dumping our debt. Our central bankers have been printing money like crack heads for the past decade and the pace increased after the 2008 financial crisis.
This entire economy recovery has been based on hot money; central bankers creating new debt to fund old debt and in the process attempting to create the illusion that all is well. It turns out that all is not well and Foreign central banks understand the fraud that is being perpetrated on the American people so they are bailing out. These guys have huge positions so they need to start moving out early; if everyone races for the exit at the same time, the market will crash and these banks will be forced to accept huge losses.
In the past week, they dumped another $22.3 billion bringing the total for the past 12 months to almost $347 billion dollars; that is an unprecedented number and suggests all is not well. China sold $34 billion in July. In fact, China has been trimmings it’s holding since 2013 when its holdings of US debt topped out at roughly 1.4 trillion. Its current holdings stand at 1.18 trillion; the lowest levels since 2012. Saudi Arabia also sold almost $40 billion worth of debt; part of the reason could be they are running out of cash to fund their terror operations as oil prices are low.
Russia led the way with dumping US debt and using it to pay down its own debt and buy Gold. China has also pretty much been taking the same route and now even the House of Saud is joining the exodus. The world understands that we have no recovery and that we are using debt to create the illusion of economic strength. The problem is that this illusion is increasing the total outstanding debt without producing any results. We can only borrow so much money because the US dollar is the world’s reserve currency. If the USD was not the World’s reserve currency our economy would be another basket case and we would be in the same position as Greece is in.
It makes sense to own some Gold as one does not know when this illusion will end. The problem is no one knows when because the Fed has done a marvellous job of conning the masses. Until the masses awaken this con will continue. It could continue for another decade or end next year. One has to follow the masses and that is why we pay close attention to what the masses are doing. Mass psychology is a very important tool and can be vital in determining market tops and bottoms if you know how to use it.
If you seek freedom, the 1st task is to attain financial freedom so that you can break free the clutches of the top players who seek to enslave you. They want you to run in a circle like a hamster that runs on a spinning wheel; the hamster thinks the faster it runs the further it will go, but sadly it is going nowhere.
We teach how to use Mass psychology to your advantage, how to view disasters as opportunities and how not to let the media manipulate you and direct you towards actions that could be detrimental to your overall well-being. Visit the investing for dummies section of our website; it contains a plethora of free resources and covers the most important aspects of mass psychology.
Secondly, subscribe to our free newsletter to keep abreast of the latest developments. Change begins now and not tomorrow, for tomorrow never comes. Understand that nothing will change if you don’t alter your perspective and change your mindset. If you cling to the mass mindset, the top players will continue to fleece you; the choice is yours; resist and break free or sit down and do nothing.
What Are Foreign Banks Doing in 2020
Central banks around the world dumped US Treasuries through March as the coronavirus’ economic toll stifled liquidity and drove massive demand for dollars, Bloomberg first reported Wednesday.
Foreign monetary institutions sold off more than $100 billion in Treasury notes in the three weeks ended March 25, according to Federal Reserve data. The period ended days before the Fed opened a new repurchase agreement, or repo, facility aimed at giving foreign central banks an alternative method for offloading Treasuries.
Parties cashing in the notes joined other sellers of global government debt looking to boost cash holdings amid a sharp downturn in economic activity, sources familiar with the sales told Bloomberg. Smaller Asian nations and oil-focused economies have primarily sold US debt, while foreign central banks’ transactions have been concentrated in older Treasury notes, Bloomberg reported.
Japan is the second-largest holder of US Treasuries with $1.21 trillion in its system, according to Federal Reserve data. China follows with $1.08 trillion in its reserves. Full Story
Dollar shortage During Coronavirus Pandemic
The Federal Reserve said Tuesday it would launch a temporary lending facility that will allow foreign central banks with accounts at the Fed to convert their holdings of Treasuries into dollars, its latest bid to alleviate strains in global markets.
The program will allow foreign central banks and other international monetary authorities who maintain accounts at the New York Fed to enter a lending arrangement called a repurchase agreement, or repo, in which borrowers temporarily exchange their Treasury securities for U.S. dollars.
“This facility should help support the smooth functioning of the U.S. Treasury market by providing an alternative temporary source U.S. dollars other than sales of securities in the open market,” the Fed said in a statement. Full Story