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kenny1703 (< 20)

Crossing the Rubicon



May 24, 2012 – Comments (0)

Sorry Fraud street bankers, your friends at the Treasury may be limiting your access to the golden goose.

According to a report released by Reuters (, China can now bypass Wall Street when buying U.S. government debt and go straight to the U.S. Treasury. This is the Treasury’s first ever direct relationship with a foreign government.

Only certain Wall Street banks can serve as primary dealers of U.S. Treasuries, which will then bid on the government’s behalf at Treasury auctions. The other central banks that are large purchasers of U.S. Treasuries, including the Bank of Japan, continue to use these designated banks as the go between.

It’s the classic example of how Wall Street plays a rigged game where they are the only player so they always win.

On one hand, by bidding directly, China stops the Fraud Street banksters from exploiting their inter-twisted relationship with the Fed. The collusive Wall Street banks can drive up the auction price with their enormous purchasing power in a given Treasury auction.

Unfortunately, giving China direct bidder status may be giving a not-so friendly foreign superpower way too much leverage, as it currently holds $1.17 trillion in U.S. Treasuries.

Food for thought.

Trade well and follow the trend, not the so-called “experts.”

Larry Levin
President & Founder - TradingAdvantage

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