‘China may dump U.S. Treasuries as Sino-U.S. tensions flare’

Nuclear options can be quite destructive (Pixabay photo)

Tensions between China and the USA remain. China has again hinted it may dump its vast amount of US Treasury notes:

China may dump U.S. Treasuries as Sino-U.S. tensions flare: Global Times

September 4, 2020

“China will gradually decrease its holdings of U.S. debt to about $800 billion under normal circumstances,” Xi Junyang, a professor at the Shanghai University of Finance and Economics, was quoted as saying on Thursday, without giving a detailed timeframe.

“But of course, China might sell all of its U.S. bonds in an extreme case, like a military conflict.”

China, the second largest non-U.S. holder of Treasuries, held $1.074 trillion in June, down from $1.083 trillion the previous month, according to latest official data. …

Dropping to $800 billion from the current level could mean shrinking its holdings by more than 25%. Analysts say large-scale Chinese selling, often referred to as the “nuclear option”, could trigger turmoil on global financial markets.

Another reason the state newspaper cited was the potential default risk in the United States as the debt of the world’s largest economy has surged sharply to about the same size of its gross domestic product …

China is heavily exposed to the U.S. dollar and dollar-denominated assets. Its official foreign exchange reserves stood at $3.154 trillion at the end of July. https://www.reuters.com/article/us-china-economy-treasury/china-may-dump-u-s-treasuries-as-sino-u-s-tensions-flare-global-times-idUSKBN25V179

China has made similar threats in the past, and this is one that could be catastrophic to the economy of the USA. That is why sometimes the expression “nuclear option” is mentioned in this context.

Notice the following from a couple of years ago:

March 23, 2018

China’s ambassador to the U.S. wouldn’t rule out the possibility of the Asian nation scaling back purchases of Treasuries in response to tariffs imposed by President Donald Trump.

“We are looking at all options,” Ambassador Cui Tiankai told Bloomberg Television, when asked whether China would consider reduced purchases of U.S. Treasuries. “That’s why we believe any unilateral and protectionist move would hurt everybody, including the United States itself. It would certainly hurt the daily life of American middle-class people, and the American companies, and the financial markets.”

China is America’s biggest foreign creditor. It held $1.17 trillion in Treasuries as of January, or about 19 percent of all foreign holdings of U.S. government securities.

The U.S. can ill-afford to see weaker demand for its debt from its major buyers. With budget deficits rising in coming years and tax cuts approved in December expected to hurt revenue, the Treasury has to sell more securities to pay the government’s expenses. https://www.bloomberg.com/news/articles/2018-03-23/china-s-ambassador-doesn-t-rule-out-reducing-treasury-purchases

While many are seemingly oblivious to rising US debt (as the various COVID stimulus debt bailouts are demonstrating to the world), the USA does not want China to sell off its USA debt.

Here is something I wrote about US debt and China in my book Donald Trump and America’s Apocalypse:

The USA is walking a dangerous line on its debt that will not end well.

Let us also consider that there is a prophecy in Habakkuk, written about 2600 years ago, about debt which is preceded by the following:

² Then the Lord answered me and said:

“Write the vision And make it plain on tablets, That he may run who reads it. (Habakkuk 2:2)

The Bible says that the ‘debt prophecy’ in Habakkuk 2 is so significant that those who read it should run—essentially that they should take steps because the results will be horrific. Donald Trump and many other American politicians have not run away from increasing U.S.A. debt—that will be to the nation’s peril.

The Bible warns about something that will happen to a heavily indebted nation. Notice what the Hebrew seer Habakkuk wrote over 2,600 years ago:

³ For the vision is yet for an appointed time; But at the end it will speak, and it will not lie. Though it tarries, wait for it; Because it will surely come, It will not tarry … ⁵ Indeed, because he transgresses by wine, He is a proud man …⁶“Will not all these take up a proverb against him, And a taunting riddle against him, and say, ‘Woe to him who increases What is not his—how long? And to him who loads himself with many pledges’? ⁷Will not your creditors rise up suddenly? Will they not awaken who oppress you? And you will become their booty. ⁸ Because you have plundered many nations, All the remnant of the people shall plunder you…” (Habakkuk 2:2-3,6–8).

Notice that what is to happen is so bad, that people who read the prophecy should run, when it is time for it to be fulfilled. Since that prophecy is to be fulfilled at the appointed time of the end, it is still for the future, but perhaps not too far distant in the future. No nation has ever been in as much total debt as the U.S.A.

Interestingly, in the past, one foreign creditor, China, has raised concerns about the U.S. debt that are so serious, that its potential dumping of that debt has been called China’s “nuclear option” (Gertz B, China Debt Threat. Washington Times, March 2, 2011) against the U.S.A.—an option that involves no military intervention, but that could greatly harm the U.S.A. (Thiel B. Donald Trump and America’s Apocalypse. Nazarene Books, 2017)

The USA must know that China is looking at what to do with US debt.

However, I do NOT expect the Chinese to try to dump it all now. But the time will come when Habakkuk 2 will be fulfilled.

China, along with Russia, Venezuela, Iran, North Korea, and others (yes, including Europe and India) are working to push aside the USA’s dollar and the USA’s economic dominance.

The Bible shows that another power–a European one–will dominate the world economy after the USA is conquered (cf. Daniel 11:39)–but only for a time (cf. Revelation 18).

Changes in the international order are happening.

US President Trump, the Federal Reserve, and the Congress of the USA are all assisting in accelerating some of those changes.

Ultimately, that will not end well for the USA (cf. Daniel 11:39; Habakkuk 2:6-8).

There is a major cost to USA debt, but most people and most politicians are seemingly oblivious to it.

Some items of possibly related interest may include:

China, Its Biblical Past and Future, Part 1: Genesis and Chinese Characters Where did the Chinese people come from? Japeth, Javan, Magog? Is there evidence that the Chinese peoples must have known about various accounts in the Book of Genesis up until their dispersion after the Tower of Babel? What do Chinese writings and characters help show? What about the Garden of Eden, Noah’s Flood, and the Tower of Babel? Here is a link to a version of this article in Spanish: ¿Prueban los caracteres chinos la exactitud de la Biblia? A related sermon is also available: China’s biblical past and prophetic actions.
China, Its Biblical Past and Future, Part 2: The Sabbath and Some of God’s Witness in China When did Christianity first come to China? What about the Apostle Thomas? Did Confucius say anything to get the Chinese to possibly consider Christianity? Is there early evidence that they observed the seventh day sabbath? What about the Ten Commandments? What type of Church of God witness has there been to China? What has been happening with China that ties it together with prophecies in Revelation? What about the 200 million man army and Armageddon? What about the Belt and Road Initiative and end time Babylon the Great? A related sermon is also available: China’s biblical past and prophetic actions. Watch also China’s Silk Road and Babylon the Great.
Asia in Prophecy What is Ahead for Asia? Who are the “Kings of the East”? What will happen to nearly all the Chinese, Russians, Indians, and others of Asia? China in prophecy, where? Who has the 200,000,000 man army related to Armageddon? Two YouTube video are Is China THE Threat to the United States of America? and China: A King of the East.
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Donald Trump and America’s Apocalypse This 188 page book is for people truly interested in prophecies related to Donald Trump and the United States, including learning about several that have already been fulfilled and those that will be fulfilled in the future. The physical book can be purchased at Amazon for $12.99 from the following link: Donald Trump and America’s Apocalypse.
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