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This whole ordeal with bonds reminded me of a story last year and it gave me an idea.
What if the chinese are flooding the market with fake bonds?
>China's Ministry of Finance (MOF) issued US dollar-denominated sovereign bonds in Saudi Arabia for a maximum of $2 billion in November 2024, marking its return to the US dollar bond market after a three-year hiatus. The issuance was priced on November 13, 2024, and received more than $40 billion in bids, which is 20 times the amount of bonds offered. This move aims to boost confidence in China's economy and attract international investors. Additionally, Chinese companies issued a combined $7.77 billion of dollar bonds in October 2024, more than doubling from the same period in the previous year, indicating a recovery in the Chinese dollar bond market.
The example above aren’t actually real US treasury bonds.
They’re just promissory notes denominated in USD.
But does china actually have the USD to pay them back?
Maybe china is the one bluffing here.
To move the yeild up .33 that would have to be around $500 billion dumped in bonds according to JP morgan, which would be the lion’s share of china’s bond holdings.
But what if they’re just fabricating bonds of their own?
