China in the first four months of 2011 made significant purchases of EU Debt, almost $150 billion of its near $200 billion in acquisitions. China seems to be diversifying their position moving away the Dollar towards the Euro. Yet, even with this shift 60% to 70% of there foreign holdings are in US Treasury notes. Stephen Green the chief China economist of Standard Chartered Bank told the Financial Times, It certainly appears that China’s finally following through on its policy to diversify its foreign reserve holdings away from the US dollar.
While China isn’t showing any signs of selling its current US holdings this move makes them one of the largest debt holders of both US & EU debt. Giving China even greater influence on the global markets and potentially allowing them to dictate economic policies in the future. China will be the largest global economy by 2020 making there current holdings of foreign debt even more important in keeping them growing.
This expansion along with there burgeoning middle-class will continue to add pressures on gold & silver prices for the near and long term futures. With the US becoming more of a debtor nation we stand precariously on the edge of a potential collapse. Now is the time to assess your Tangible Asset Portfolio and make sure you are prepared to protect your investments.