Thailand continues to buy… US debts

Today folks… let’s have a look on the US Treasury securities, who are the major foreign holders, and how much Thailand bought…

First, the definition :

United States Treasury security is a government debt issued by the United States Department of the Treasury through the Bureau of the Public Debt.

Treasury securities are the debt financing instruments of the United States Federal government, and they are often referred to simply as Treasuries. There are four types of marketable treasury securities: Treasury bills, Treasury notes, Treasury bonds, and Treasury Inflation Protected Securities (TIPS).

Let’s see the list of the major foreign holders of US Treasury securities (in billions of dollars), holdings at end of period (source US Treasury).

ustreasury1

Astonishing, huh ? The total is 3072 billions USD (january 2009)… China and Japan own almost half of it (1374 billions)… !

And Thailand ? 37,2 billions. More than India, South Korea and France…

Now let’s look at the evolution : year on year (compared to january 2008) and month on month (compared to december 2008).

ustreasury21

A whooping +28 % for Thailand in one year… And compared to december 2008, Thailand is number 1 (+14 %) ! 😉

Congratulations…

So the question is : who is buying ? Many financial institutions can buy bonds for instance. My bet : the Bank of Thailand is responsible for the bulk of the increase.

There is some correlation with the figures of the foreign currency reserves.

And another question : is it a good move ?

I’ve got a strong opinion about it : no it’s not good. It’s even really stupid. The USD is a ticking bomb… the US debt is a ticking bomb… So to buy US debts today is like to sit on 2 ticking bombs…

It’s a classic move, picked from the text books (“fly to security” blabla) but it’s so overdone…

And to buy US debts (in USD) has one direct effect : exchange rates. The Bank Of Thailand apparently continues to buy USD, against THB… They are supporting the US dollar…

When exports are devastated, such a move could cause serious political backslash…

Many central banks are screwed : if they reduce their holdings, it will affect the USD and could create a snowball effect… The USD could fall, implode, crash.

What China can do with their 739 billions of US Treasury securities ? They are really screwed. Even if they stop buying, it could have very negative consequences.

Last point : what means “Carib Bnkng Ctrs” ? Caribean Banking Centers… AKA off shore paradises for grey money and grey finances…

What ! ? They “own” 176 billions USD ? How come ? I bet you didn’t know that… 😉

Those are the official figures given by the US Treasury…

Welcome to the world of corruption… Those tiny islands are used… yes by drugs and arms dealers… but that’s not the point.

They are used by ALL THE MAJOR world banks, US, european… you name it… And some of them have very close ties with the US authorities…

It means, the US could use those “black boxes” to buy… their own debt for instance ? To intervene on the markets, behind a false nose ?

Nah, that would be a crazy idea. 😉

Last point : don’t forget to pay in due time your taxes. We are the useful idiots. They need us. And our money.

Be a good citizen, pay your taxes, vote from time to time (for the people they choose, like Obama), watch TV, believe what they tell you, and please… shut the fuck up.

And in Thailand, they ask you something more : don’t forget to smile. 😉

9 Responses to “Thailand continues to buy… US debts”


  1. 1 World Insanity 30 March 2009 at 3:32 pm

    Indeed, the drug economy is propping up what remains of the global economy.

    The global financial system is imploding under its own cancerous weight, & Dope, Inc. is moving in to take over the entire world economy. The world’s available money supply is tied largely to the attempted bailout of financial institutions, and you’ve got a shortage of money, of any kind of credit, building up rapidly into catastrophic levels in every other area. Now, the argument is that you have to be good to the drug pushers, because they are the only ones who are supplying the loose cash & the drug supply of money is increasing.

    The only reason we have a drug problem is because governments don’t want to take it away as the international drug trade is in the trillions of dollars.

    Opium and heroin production today is completely out of control with the vast majority of the worlds production being produced in Afganistan’s under the watchful and approving eye of British & allied NATO troops deployed in the country. Further, marijuana production has risen dramatically in Afghanistan, to the point that today the hectares cultivated are a third the total dedicated to opium.

    It can be seen in the horrific violence which the drug gangs have unleashed in Mexico, including more than 5,000 people murdered in 2008, and countless cases of bestial beheadings and ritual torture of competing narcos and of anti-drug police chiefs and army generals alike.

    It can be seen in the fact that millions of peasants in drug-producing countries, such as Afghanistan or Bolivia, have become de facto work slaves of the cartels, since the collapsing world economy provides them and their families no source of simple survival, other than the drug economy.

    It can be seen in the uncharted, huge rise of global consumption of high-potency, highly addictive marijuana, including in hapless Africa—most of which is starving, and yet today produces a fifth of the planet’s marijuana.

    In part, the increased physical production of drugs may not be translating entirely into increased consumption. There are indications that some narcotics, especially heroin, are being “commoditized” & used in barter arrangements for the purchase of weapons for terrorists & others, & speculative commodities such as gold.

  2. 2 brazoo 30 March 2009 at 4:41 pm

    Just like the anericas will say: “Its our dollar, but its your problem”

    Leaving Thailand out of this discussion … this can be the signs of the next crisis.
    If we look at China, not only the biggest holder, but also increasing almost 50% in the last 7 months. You would not do that if you were free to choose. You would not lend money to someone who is broke if it wasnt the US. But it worked in the past, why shouldnt it work now? And they invested a lot, lost value allready, why loosing more? Lets buy US debts.

    This is so on the edge … I am afraid this will cruble soon. And the crisis we are seeing now might look insignificant compared to it.

    And it can happen so easy … what if the US starts “protecting” their market and therefore some “countries” start cashing in and reduce debts. The dollar falls … and thats still the best option, because worst case would be loosing it all. But … it will be interesting how the different countries react, because no one will want to let that happen. But on the other hand investing in US securities will not be a reliable option in the future anymore, if we dont see a significant economic growth in the US.

    I hope I am wrong 😉

  3. 3 irubyouhandsumman 30 March 2009 at 4:45 pm

    Oh my !!!! Forget the big number, worry more about debt as a % of GDP. Lots of stats available on this matrix.

    Also, I think you will find this chart of who owns U.S. debt far more detailed. Npow remember, this does not include municipal or private debt.

    http://www.treas.gov/tic/mfh.txt

  4. 4 World Insanity 30 March 2009 at 6:47 pm

    The Key is China. We must wait for China to play its hand.

    FOREIGN CREDITORS
    Foreign creditors own more than half the US debt securities. As such, they can slowly take control of the US with hidden strings, hidden deals, as subtle changes occur in priorities held by US leaders. They can begin to control the selection of key position appointments, or else to go into revolt.

    CONFLICT
    The war of words, the high-level conflict, between the US and China continues to escalate. This is a significant titanic conflict since China is a principal creditor. 2 weeks ago, Premier Wen Jiabao, complete with a finger wagging gesture, gave an unprecedented warning. The implied message was clear: Do not devalue the US Dollar through reckless spending. Wen wants to avert massive additional losses from a currency collapse. At issue is a vast stream of stimulus packages, escalated federal deficits, endless rescues, to push down the value of the US Dollar, and thus the held value of the Chinese hoard of savings.

    CONCESSIONS TO CREDITORS
    China could embark on a colonization movement. Huge tracts of US TBonds have been accumulated by China since September. The US TBond hoard held by China would be converted into mortgage bonds, and then into actual hard asset property, including commercial buildings (for a very low price – foreclosures).

    YUAN TO REPLACE US DOLLAR
    In a bold plan, the Chinese Govt., in order to aid in the stability of the Asian economy, has announced the Yuan currency will soon replace the US Dollar as the new Asian regional reserve currency. The stage is set for Asia to install the Chinese Yuan for broad usage across Asia, with possible massive dump of US Treasury Bonds.
    http://online.wsj.com/article/SB123780272456212885.html

    The Yuan will be infused throughout their banking system. Other Asian governments (Thailand) will surely follow suit and discharge reserve US TBonds in favor of the Yuan currency. The full impact will be felt when Asian nations who participate in this new reserve currency begin to purchase raw materials and commodities like grains, energy, and metals in Asia, using Yuan currency in hand.

  5. 5 World Insanity 30 March 2009 at 7:07 pm

    PHONY FRONT AGENTCIES
    How can the Caribbean Bank Centers realize a jump from $117.6 billion in July 2008 to a hefty $203.5 billion in October 2008 in US TBond holdings?

    Such numbers are consistent with enormous nations with huge economies, vast banking systems, large indigenous credit markets, massive industries, etc!

    Are we talking secretive Caribbean slush operations and phony front agencies doing the US Fed’s bidding and doing the US Treasury’s bidding?

  6. 6 ThaiCrisis 30 March 2009 at 7:13 pm

    Eventhough China has indeed a few jokers… they are not alone. It would be dangerous to overestimate China and its role (and its weight).

    In the drama that is currently unfolding… let’s not forget the biggest player : USA.

    Many people agree that USA will lose their influence, eventually… Sure. But let’s not forget : they will not go down… without a fight. This is a certainty.

    For instance : I totally disagree with the idea that the RMB can replace the USD. Right now, it’s just a dream. RMB is a bureaucratic monstruosity. China is riddled by problems… Sure we don’t hear them a lot… The PCC knows how to be discreet.

    But behind the scene, the balance sheets of chinese banks… are probably not very pink and are not smelling very good. What about the social tensions ? This “country” could implode… Like it did many times in the past.

    China did make huge improvements (at high costs, human, social, environmental)… but China remains fragile.

  7. 7 ray 31 March 2009 at 4:14 am

    russia has already come out with a plan. it must be couple months ago that putin suggested a new currency backed by gold,silver,oil and agricuture . china russia and saudi arabia are behind this move which i do agree with. but what about trillions of dollars that other countries all around the word hold as reserves? what we read in the news is six months old information. this g20 summit will really showcase the world how deep in this s@@t we reallt are.

  8. 8 George P Tuckeer 31 March 2009 at 5:00 am

    @ Ray
    “what about trillions of dollars that other countries all around the word hold as reserves?”

    Every way out of this that I can see, looks painful:
    *Massive USD devaluation
    *US debt write off
    *Exchange treasuries for real US assets
    *Major holders quietly retire large portions of their holdings in exchange for political/military concessions from the US. Remember, the major treasuries holders are dictatorships; their demands will not be pleasant. As bad as the US is, these guys are worse.

    Any other ideas out there?

  9. 9 World Insanity 31 March 2009 at 8:29 am

    Ray:
    Five Gulf Arab states – Saudi Arabia, the United Arab Emirates, Kuwait, Bahrain and Qatar – have been working for years towards launching a single currency in 2010 possible to be called ‘The Khaleeji.’

    The Kaleeji image: http://cyrrion.com/image/forex-khaleeji.jpg

    The Arabic word ‘khaleeji’ (خليجي) stands for ‘of the gulf’ which would explain the ‘G’ symbol with the by now customary central bar. However, there may be another explanation: just as the ‘$’ symbol once so aptly stood for ‘unit of silver‘ the Khaleeji could be understood as a ‘unit of gold.’ The most convincing argument for such an interpretation is that having a gold/silver backed currency is considered the final leg to remove Riba (ربا ‘interest’ or ‘usury’) from the financial system, which is forbidden according to Islamic economic jurisprudence.

    Latest Currency Union News:
    March 24, 2009 Gulf states delay single currency. A new timetable for its introduction has yet to be set.

    http://www.gulf-times.com/site/topics/article.asp?cu_no=2&item_no=280707&version=1&template_id=57&parent_id=56


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Thailand Crisis

Coup, Economic slowdown, Terror In the South... The situation is worsening in Thailand. Bumpy road like often before.

But this time, it's different.

The key to understand the present turmoil is the inevitable... succession of King Bhumibol.


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