eli5 bond situation cont’d

- market up (yay).. why? tariff pause is good for US economy
- bonds yields went lower as well (meaning people buying yay!)
- treasury bond auction saw buyers. good sign that there is real demand for bonds at these prices
- calm day overall

.. but what about China? (more below)

Building Higher apparel at High Line 🧢 
Host at /clickcast /cpg || Husband to @shiwen

Situation: China holds a metric ton of US bonds and can do real damage if they managed to full clip their holdings.. so why not?

1. Bargaining chip - as a big holder in the largest US market (US treasury bonds), they can inflict major damage if they did sell big. If they do sell and don’t land a death blow to the bond market.. 

2. Their economy is still heavily tied to the strength of the US dollar. They even intentionally sell Chinese bonds to weaken their currency compared to the USD. Selling down their US treasury stockpile wrecks China’s already weakened economy

This is the nuclear option and they haven’t pulled the trigger on it.. at least not yet