Skip to comments.The sell-off started with a mysterious plunge overnight
Posted on 12/06/2018 10:26:51 AM PST by BeauBo
Speculation for the swell in volume and plunge in futures included the news of the arrest of the CFO of the Chinese telecom company Huawei. Traders also speculated that the selling could be attributed to a large fund or funds liquidating a position.
(Excerpt) Read more at cnbc.com ...
They have enough assets to manipulate markets in the short term to achieve a political effect, or put pressure on trade negotiations.
Could they have had a hand in the perfectly timed 2008 stock market crash, that put Obama into office?
They have long threatened to dump their US Treasury bonds in a similar act of market manipulation, to drive up US interest rates, and bust the Federal budget.
They have clearly been considering using such cyber or economic weapons for a long time, and the USA has long been designated as their primary opponent in the their doctrine.
Deep State could make a lot of money:
1. Establish big short positions in highly liquid issues
2. Effect the arrest
3. Observe the arrest effects; a yuge sell-off
4. Buy back, make YUGE money
Has CNN yet blamed Russian hackers operating out of Macedonia?
Hillary von Pantsuit likely will.
What is the Nazi collaborator Soros up to now?
It began before she was arrested. I noticed it after the election.
I have little doubt that China can ruin us economically because they own all our debt, which our government is addicted to. But a USA with an economy in rubble would leave China with their own problems. They are far too dependent on the USA as a market, way more than we are on them (because they won't open their markets to us).
Besides, such an overt act would get retaliation. Economic at first, perhaps. Ultimately escalating to military. It would probably start WW3. They might make us broke but we could still feed ourselves and still launch our nukes, at least for a while before civil unrest of the gimmedat class started when the government checks stopped showing up.
Would China take that risk?
The two words that would guarantee Biden in 2020: ‘Trump Recession’.
More likely the attack of the margin call clerks.
“Hello, sir. I am as afraid you will have to deposit an additional $350 million in your account by the end of the day, or we will be required by Reg T to liquidate your securities.”
Deep state panic.
Probably something along that line. The Shanghai Stock Index has lost almost 1/3 of its value in the last year. Trump has been turning the screws, and we might see the Chinese attempt to kill the market and the market approach 20,000, but this economy is too strong.
Inventories have to be filled, and it’s going to take Q4, 1, and 2 to fill a lot of them.
They don’t own all our debt. They are holding approx 1.6T of it. We could inflate that away in half a heartbeat.
Dirty little secret is China is in worse shape than us economically.
Again, no mention of Iran...
China owns about 7% of U.S. Treasury debt. That's the largest share owned by any foreign country, but it's hardly "all our debt."
Late fall market decline has been a fairly consistent phenomena since the arrival of large mutual funds. Fund Managers lock in gains toward the end of the year (and pad their bonuses.)
Trump has the better hand.
I think he should include the debt in trade negotiations!
I wonder what the CIA and DoJ heads invest in,, ‘black hole’ budget and all,, they need to fill gaps for special projects from time to time, I’m sure.. like making up dossiers and hiding their agendas.
They don’t just have carte blanche .. or do they?
Without oversight, gubamint is a waste of time and money.
It always gets hijacked in the end by those who claim to defend it even while they are gutting and milking it..
While the stock market went down last night, at the same time the US bond market went up. Our debt is greedily purchased from people all over the world, not just China. And when I say people, I mean countries, banks and pension funds. The US ten year note is going up in price. The yield has dropped below 3%. Our country is not falling apart. Our debt is not currently a big deal.
If you are looking for cracks, consider the EU. And especially watch Italy. If the western world falls apart, it will start there. Before the central banks intervened, Italy’s debt was yielding over 7%. Now its about 3.2%. And it was only 1.7% in May. The EU only talked about not buying bonds and germany’s bonds went up to .24%. Italy’s bonds moved to 3.2%. So the yield could more than double, going back to 7%, if the EU’s central bank stopped buying their bonds. If the EU falls apart, there would be contagion. And that would cause trouble in the US. But until you see it there, its not coming here. They are the front line.
I highly doubt it. 2008 was caused by extremely over-leveraged mortgage positions by a lot of banks.
“I have little doubt that China can ruin us economically because they own all our debt”
Out of our about $20 trillion in outstanding Treasury notes, the Federal Reserve is by far the biggest single holder - and they could buy several times more than China currently holds, should they decide to do so.
Here are the top ten foreign holders (Sep 2018, in billions):
China, Mainland 1151.4
United Kingdom 276.3
Cayman Islands 199.4
Hong Kong 192.3
Saudi Arabia 176.1
Also, China needs dollars to settle accounts at their ports for imports, so they must retain about half of their holdings, just to keep enough dollars in their “checking account” to keep goods flowing. They need foreign reserves to support (control/manipulate) their currency as well. Their position is much more tenuous than ours.
They have the means and skills to make serious trouble in our markets in the short term, but not yet enough to make permanent damage.
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