My thought exactly. But in adding to your contextual contribution:
This is a really small and rather obscure pension fund for academics, which has a elitarian focus on being sustainable. Don’t get me wrong, even if all Danish pension funds dumped all their US federal bonds in a day it wouldn’t register in the price.
We need to bring the Norwegian oil trust in on this.
Its not much numerically, but this is the first time a foreign holder of bonds has publicly announced they no longer have faith in the credit of the United States.
That is a big headline in the financial world. The entire international finance market is currently reassessing the stability of the US in a negative light. The only way out from here is down.
When you hear reported [Japan] owns [$x.xx] in US Treasuries, that figure isn’t a monolith. The Japanese government owns some, and Japanese corporations own some, and the Japanese people individually own some, and more. It would have to be a collective effort, and there would realistically need to be a financially sound alternative place for them to safely park their money
That’s an interesting concept in this context. What’s financially sound in a possible WWIII? As far as alternatives, I think it relative. Relative to a sinking ship that will suffer severe divestment from around the world, almost anything, really.
It may be nice to imagine, but as long as the US continues to pay interest on Treasury bonds, US Treasuries will not be viewed as a “sinking ship.” Divestment in this case would be purely a political decision
That is like, barely any.
Daily trading volume of US treasuries is ~900 billion (https://www.brookings.edu/articles/whats-going-on-in-the-us-treasury-market-and-why-does-it-matter/).
Thats 0.00002% of treasuries traded in a single day.
There will be a ripple effect now that at least one has taken the action. Let’s hope it snowballs.
My thought exactly. But in adding to your contextual contribution:
This is a really small and rather obscure pension fund for academics, which has a elitarian focus on being sustainable. Don’t get me wrong, even if all Danish pension funds dumped all their US federal bonds in a day it wouldn’t register in the price.
We need to bring the Norwegian oil trust in on this.
Its not much numerically, but this is the first time a foreign holder of bonds has publicly announced they no longer have faith in the credit of the United States.
That is a big headline in the financial world. The entire international finance market is currently reassessing the stability of the US in a negative light. The only way out from here is down.
snowball effect, rollin’ down the mountain…
Dun-nuh-nuh-nuh-nuh-nuh-nuh-nuh- Dun-nuh-nuh-nuh-nun.
Every flood started with a little rain. America is a global pariah. Even America hates America. Just watch…
Now if Japan decided to offload on the other hand…
When you hear reported [Japan] owns [$x.xx] in US Treasuries, that figure isn’t a monolith. The Japanese government owns some, and Japanese corporations own some, and the Japanese people individually own some, and more. It would have to be a collective effort, and there would realistically need to be a financially sound alternative place for them to safely park their money
That’s an interesting concept in this context. What’s financially sound in a possible WWIII? As far as alternatives, I think it relative. Relative to a sinking ship that will suffer severe divestment from around the world, almost anything, really.
It may be nice to imagine, but as long as the US continues to pay interest on Treasury bonds, US Treasuries will not be viewed as a “sinking ship.” Divestment in this case would be purely a political decision
You mean the interest trump is persecuting the fed to lower? That interest?
Glub glub glub. Sauve qui peut!