China keeps selling US bonds, will overseas funds retaliate against it?Will they also sell Chinese bonds?
It's easy to find the truth from the data.
The data shows that foreign institutions have been ** China's bonds for 9 consecutive months. This is strange, not long ago, overseas institutions and foreign ** were still vigorously singing about China, not optimistic about China's economy, but very precious to the US Treasury bonds.
Why is it now vigorously selling US bonds and a large amount of ** Chinese bonds?
Whether it's Moody's downgrading China's credit rating outlook, investment banks like Goldman Sachs, and some research institutes, the reasons for China's downturn are the same, mainly focused on the debt problem. However, this is not the case.
In an analytical report, Goldman Sachs raised nine questions around our local debt, but it boils down to the idea that our explicit and implicit debt combined are too high. Goldman Sachs estimates that the accumulated debt will reach 93 trillion.
Moody's expressed similar concerns, arguing that the debt of the financing platform could be converted into a debt of **, which in turn could affect the country's fiscal strength and sustainability.
However, China's ** has given a clear response to this: at present, ** and local debts together are 61 trillion, equivalent to 50 of China's total GDP4%, according to international standards, China's debt scale is below the 60% warning line, which is not very heavy.
By contrast, the size of the US debt has soared to $34 trillion, accounting for 130% of the US GDP, and the debt pressure is clear.
But the most amazing thing is that under such a high scale of debt, Wall Street analysts are desperately encouraging investors to *** US bonds. However, at the same time, many hedges are gradually releasing U.S. bonds.
Saying one thing and doing another seems to have become a common trick on Wall Street.
Because we found that they were selling US bonds at the same time they were buying Chinese bonds in large quantities.
This is because buying Chinese bonds can bring relatively high yields and relatively manageable risks.
First, yields on Chinese bonds are likely to have more room to grow than U.S. bonds. Since foreign institutions believe that China's debt is under pressure, they may ** the yield of Chinese bonds in the future **, and thus obtain higher yields.
Second, these institutions generally believe that risks are manageable and have confidence in China's ability to resolve debt. They believe that it is safe to buy Chinese bonds, not only to avoid the risk of thunderstorms, but also to obtain considerable returns.
The two opposite developments between China and the United States are enough to show the attitude of capital, which is more optimistic about China's economy than the United States.
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