I just read this on ZH. Its good you posted it.
Too bad we can’t get the foreign ownership stats on a real time basis. This would be fascinating to watch over the next week. Might see a lot of dumping, which of course would have significant implications for our own interest rates.
If the US goes ahead with some form of sanctions next week, you can count on it, IMO.
Is whom was selling as important as whom was buying? I wonder who bought them, the FED?
a)if the rates climb, the Fed will step in to buy the bonds, pushing rates down.
b)If the rates climb, the value of the bonds will fall and the foreigners will lose too much, which will also moderate the sell-off.
c) The increase in dollar reserves will also tend to drive down interest rates on dollars.
What will happen is that the dollar will fall more relative to the Euro, Yen and Yuan: look for gas prices and other commodity prices denominated in dollars to go up, as foreigners look to recoup their FX losses from the Fed's inflationary policies.