“WASHINGTON — China, the biggest buyer of U.S. Treasury securities, reduced its holdings in December for the second straight month.
Overseas demand for Treasurys helps lower the interest rate the U.S. government pays on its debt. If the United States had to finance its debt through U.S. investors alone, the government would have to pay higher rates. American companies and consumers would also pay higher rates.”
What do you think?
Remember when we asked about the U.S. back-up plan on the off chance our biggest foreign debt holder decided to sell off our Treasury bonds? Well.
Maybe they’re just rebalancing their national portfolio. Or following the age-old rule of “don’t put all your eggs in one basket?”