dreamdancer 0 #1 February 11, 2010 what are they scared of... QuoteA Communist Party directive leaked to the Chinese-language edition of the Asia Times said dollar reserves should be limited to US Treasuries or agency mortgage debt such as Freddie Mac that enjoys Washington's implicit backing. BNP Paribas said the move has major implications for global risk assets. "The message from Beijing is that we don't like this environment," said Hans Redeker, the bank's currency chief. There will be slim pickings if China loses its appetite for Western debt"When the world's biggest investor turns risk-averse, that is something you take notice of. We think this could become the new theme for the markets in the medium-term," he said. The directive covers both the State Administration of Foreign Exchange (SAFE) and China's state-controlled commercial banks. Together they have an estimated $3 trillion (£1.9 trillion) of foreign holdings. The exact break-down of China's holdings are a state secret but it is understood that SAFE bought large amounts of corporate debt as well as municipal and state bonds during the boom years of 2006 and 2007. Any move to liquidate holding of California debt at this crucial juncture could have serious implications. http://www.telegraph.co.uk/finance/china-business/7205110/China-orders-retreat-from-risky-assets.htmlstay away from moving propellers - they bite blue skies from thai sky adventures good solid response-provoking keyboarding Quote Share this post Link to post Share on other sites
