China Is Drastically Reducing Its Holdings of US Debt

Is there anyone else who has the money or desire to buy our notes. The Gulf Arab central banks said they still regard US Treasuries as a safe but how long will that last?

If no one else steps up to buy our debt this may signal the "unraveling" of the US economy, the beginning of titanic economic tsunami. 

Guest report-Steven Mantz

China is reducing its holdings of US debt. uh-oh. 

China has dropped 97 percent of its holdings in U.S. Treasury bills, decreasing its ownership of the short-term U.S. government securities from a peak of $210.4 billion in May 2009 to $5.69 billion in March 2011, the most recent month reported by the U.S. Treasury.

Treasury bills are securities that mature in one year or less that are sold by the U.S. Treasury Department to fund the nation’s debt.

Mainland Chinese holdings of U.S. Treasury bills are reported in column 9 of the Treasury report linked here.

Until October, the Chinese were generally making up for their decreasing holdings in Treasury bills by increasing their holdings of longer-term U.S. Treasury securities. At that point China’s overall holdings of U.S. debt continued to increase.

Since October, however, China has also started to divest from longer-term U.S. Treasury securities. As reported by the Treasury Department, China’s ownership of the U.S. national debt has decreased in each of the last five months on record, including November, December, January, February and March.

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China Has Divested 97 Percent of Its Holdings in U.S. Treasury Bills | CNSnews.com