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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: Taikun who wrote (30822)4/17/2005 9:43:42 AM
From: orkrious  Read Replies (2) of 110194
 
I do wonder how prudent it is for a CB to have less USD in their reserves than the portion of their USD trade.

taikun, I am not sure what you mean. it's not like China and Japan have balanced trade with the US. All they are doing is taking in dollars in exchange for goods. they don't have to save dollars to buy back goods from the US.

unless they expect their trade surpluses to begin reversing, they may as well take their most of their dollars and buy something of value with them, like gold or natural resources.
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