Foreign Exchange Yuan
foreign exchange yuan
Economic experts said that China should maintain foreign exchange reserves of U.S. government bonds has decreased significantly – Refractory Industry
Not long ago, "Stock" god Buffett, referring to the behavior of the United States borrowed heavily, particularly in reference to China, said: "They (the Chinese) a day of hard work to make products with the Americans, and give us part of your role. When you want to use these pieces of paper, for example, bought a couple of years to come a time when the oil company Unocal, to find that piece of paper can not achieve the desired goal (the CNOOC bid for Unocal in 2005, it was the obstruction Error U.S.). "
This, it is said that the decentralization of China's foreign exchange reserves, the best, but said that if some assets in Treasury bills U.S., China remains concerned by the loss, I ask, are at the end of holdings of U.S. Treasuries? For China's holdings of U.S. Treasury too many problems, there is much controversy. In 2009, the U.S. Treasury April 15 published data, we see that China once again in March 2009 bond holdings 23700000000 U.S. treasury, total assets reached 767.9 billion dollars, has been maintained since September 2008 U.S. Treasury holdings of China, the number leadership position. In the financial crisis has not bottomed out, the dollar continued to weaken the impact of the RMB exchange rate and so on continuously, Chinese holdings of Treasury Bonds U.S. have once again dispute. The spread of financial crisis and the advice of Warren Buffett, we draw a conclusion that, far from the U.S. Treasury seems to be a good choice, we must adjust the investment strategy, which has assets in U.S. Treasury bonds? Why holders of U.S. Treasury
First, we must face the fact that today we have large reserves. Since March 2009, reserves Chinese Foreign Currency U.S. $ 1,953,741,000,000. The trade surplus with the United States is a major source of foreign exchange reserves, which is to promote China's economic development engine from the point of view of economic history, Japan, Korea and other countries in the development of a very important point is to capture the U.S. market Similarly, China should develop the economy should enter the U.S. market. This is the long term, we want large dollar reserves is inevitable. For years it is difficult to achieve diversification of foreign exchange, and the rest of the matter is resolved how to handle the huge reserves of foreign exchange problem.
Indeed, the management of reserve assets of commercial banks to approach the management of similar assets, primarily reflecting "Nature" principle namely, mobility, security and profitability. At first, we had a period of foreign exchange reserves, the reserve assets is divided into three levels: (1) a reserve asset: high mobility, low income, such as tanks point of view, the short-term government bonds, (2) 2 reserve assets: both realized and profitability as treasury bills and medium-term bankers' acceptances, (3 3), reserve assets: to meet basic security, especially in the investment environment and long term, taking into account the profitability of the target value, such as Treasury bills in the long term, a class of stock. This supports our theory, the U.S. Treasury USA.
So really, why the U.S. Treasury will become the first choice for China's foreign exchange reserves invested? Mainly in the United States is the world's largest economy and has more developed financial markets, U.S. Treasury bonds is also topped the global share. United States Treasury bonds, low risk, liquidity strong euro and yen, compared with the dollar zone economy remains in good standing. In this context, to buy U.S. bonds than expected and presented. Chinese purchases of U.S. government bonds, Treasury bonds are another important reason I believe that in central China to buy Treasury Bills U.S. are not in the interest rate investment, but to stabilize their currencies against the dollar to protect exports of China. Every year large amounts of U.S. Treasuries can prevent the renminbi exchange rate. However, the continuing appreciation of the yuan, is not favorable for exports Chinese. Taking full account of security conditions, investment opportunities in China's foreign exchange reserves are relatively low, the company's investment investment foreign is still experimental, some countries have sovereign wealth funds resist emotional, and I am of resources and foreign enterprises the level of investment in short term can not be effective, such as U.S. Treasury bonds Fandao have to make a kind of choice.
To buy Treasuries United States risks and benefits
Underachievement U.S. Treasuries, but the fluid, if the U.S. Treasury as a reservoir to hold, and the right scale, no we must consider whether the reduction of the problem. The problem now is that we have organized a major U.S. government bonds in terms of lower yields, should we focus on reviewing your own risk.
Americans at risk Treasury holdings of China about three categories: risk payments inflation and depreciation of the dollar U.S. dollar against the yuan. For the payment risk can be considered negligible the probability of its occurrence as a tool to pay the debt, the distribution rights of the Federal Reserve dollar in the income ratio of Bond debt service has exceeded the level expected by the government or the balance of government bonds and savings deposits of residents in the proportion of principal balance of the accumulation of wealth in the corresponding limits in the microwave The latest issue of liquidity in U.S. dollars means in this case, there is reason to believe that the Fed refused to return the ticket issuance. About the Author
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