Archive for the ‘Fannie Mae’ Category

China Less Willing to Be America’s Piggy Bank

December 22, 2007

By Floyd Norris
The New York Times
December 22, 2007

For the last three years, China has been the financier that kept the American government well funded. In 2004, it bought a fifth of the Treasury securities issued, a proportion that rose to 30 percent in 2005 and to 36 percent in 2006.

But according to United States government figures, China reversed course in 2007 and has become a net seller of Treasury securities. The Treasury said this week that China had $388 billion in Treasuries at the end of October, slightly less than it had at the end of 2006.The sales, if the American estimates are correct, have come in a year when the dollar has been weak against most currencies. The sales would be consistent with China’s diversifying its investments into other currencies.

But the figures may be misleading.

For one thing, other Treasury estimates show that the Chinese are still increasing their holdings of bonds issued by quasi-government agencies, like Freddie Mac and Fannie Mae, and by American companies.

Read the rest:
http://biz.yahoo.com/nytimes/071222/1194729172501.html?.v=8

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