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Posted on 05/03/2025 9:28:08 AM PDT by Racketeer
Finance minister Katsunobu Kato hints that country’s more than $1tn in Treasuries gives it leverage in negotiations
Japan’s finance minister has publicly identified the country’s more than $1tn holdings of US Treasuries as a “card” in its trade negotiations with the Trump administration, in a rare baring of teeth by America’s closest ally in Asia.
Speaking during a television interview on Friday, Katsunobu Kato was asked whether Japan would use its traditional stance as a non-seller of Treasuries as a tool in trade talks with Washington.
“It does exist as a card,” said Kato, adding that “whether or not we use that card is a different decision”.
Japanese holders, including the government, own $1.13tn of Treasuries, the largest hoard held by a foreign nation.
(Excerpt) Read more at ft.com ...
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Maybe POTUS Trump or Scott Bessant start commenting on raising Japanese tariff’s to 300%. Maybe!!
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And then maybe Japan uses it’s card.
I’m sure Trump never saw that possibility coming. /s
Suppose several countries dump their T bills at once.
Then what?
At this rate Japan, S. Korea, Taiwan, and Vietnam may decide it’s safer to deal with Red China. At least Red China is consistent. The same can’t be said about the US.
Longterm that is not a good strategy for those asian countries. They know it, and we know it, and they know that we know it.
US debt public (not at the Fed, which holds $6T) is $31T.
30% of that is foreign held, so $10T.
Japan holds $1.1T per the article. That is the largest foreign holder.
You can’t sell anything unless there is a buyer. But you can sell urgently and the buyer be less urgent and drive that price down (for Treasuries, if the price falls, the yield (interest rate) rises).
Japan has some clout in this, but frankly, the Fed could buy the $1.1T and hold the price up if they wanted to (and they have never been reluctant to want to). It would just mean their $6T holdings become $7T. The only real danger is further exposure of the manipulation of pieces of printed paper.
except that they are not all that keen for chinese dominance
Not true.
I think you have a point for short term but not long term. The countries you mention hate dealing with China because China screws them over. The US/Trump is looking at long term benefits. It’s a tricky situation.
We’d be royally screwed, imo.
China has a rapidly aging and soon to be shrinking population. Korean, Chinese, and Taiwanese technology matched with Filipino, Vietnamese, and Indian labor could easily keep Red China in check. The USA will become irrelevant.
China has a rapidly aging and soon to be shrinking population. Korean, JAPANESE, and Taiwanese technology matched with Filipino, Vietnamese, and Indian labor could easily keep Red China in check. The USA will become irrelevant.
How much of the US National Debt is held by the FED?
As of recent data, the Federal Reserve holds approximately 20-25% of the US national debt, primarily in the form of U.S. Treasury securities it has purchased through its open market operations. This percentage can fluctuate over time due to changes in monetary policy and market conditions. For the most current and precise figures, you can refer to the Federal Reserve’s weekly H.4.1 release or the U.S. Treasury’s reports.
What would be effect of the fed holding 75% of the US national debt, and another 25% by US citizens as the daily cash float of the US stock market?
I do not see the downside as the rest of the world economy is peered up against the US machine.
What a non story. Guy was asked a question and answered it diplomatically. What was he supposed to say leading up to a negotiation?
People have forgotten what a trade war looks like. The remaining old guys over in OPEC are licking their lips if 4 weeks of tariffs on Chinese bullshit are causing this much damage to the world economy. I expect a problem in the gulf the week after a Ukraine-Russian cease fire.
We should cut off their oil imports.
I’m pretty sure we still have Enola Gay somewhere out there in good condition.
“Suppose several countries dump their T bills at once.
Then what?”
They lose a lot of money. Fast....
What a non story. Guy was asked a question and answered it diplomatically. What was he supposed to say leading up to a negotiation?
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Thread winner!
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