Friday, May 16, 2014

China Daily - China Trims US debt holdings and seals energy deal with Russia

Here are a couple of news items from China Daily of interest:

China slightly trims US debt holdings by $800 million

China-Russia gas deal set to be signed

Some points of interest from these articles:

-China cut its US bond holdings a little, but Japan and Russia sold off over $35 billion in US bond holdings. Russia sold nearly 25% of its total holdings. Certainly this is due to the Ukraine situation

-Belgium is listed as buying over $40 billion in US debt becoming now the 3rd largest foreign holder of US debt at nearly $400 billion total. Since Belgium is too small to be buying this many US bonds alone, it is certain that these funds are coming from some other source but are showing up as purchases in Belgium for whatever reason. Former US Assistant Treasurer Paul Craig Roberts believes the US FED may be funneling funds to Belgium to help buy these bonds. If so, it means they are concerned about the perception that real demand for US bonds is falling leaving the FED as the main buyer left

-Putin will be in China next week and is expected to sign this huge gas deal along with a reported 30 plus other agreements between the two nations. The Asian and Russian media are playing up this as a big event so there should be a lot of news articles on it next week. We will follow it. We have already noted that these new deals will bypass use of the US dollar which is a significant event related to what we follow here on this blog.

-Jim Rickards tweeted today that this big energy deal and Putin's visit to China next week are siimilar to what he and others simulated in a "war game" for the Pentagon a few years ago. Part of a strategy to weaken the US dollar. He says this is an important event in that process.

Summary: Lots going on for us to follow next week. Lots of chess moves being made on the international game board for us to try and keep up with.

Note: Here is Rickards tweet today.

"China investing in Crimea. Putin's on his way to Beijing for non-USD mega-gas deal. Like we told Pentagon in '09"

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