r/wallstreetbets • u/s1n0d3utscht3k • Mar 03 '25

News Trump Officially Signs 20% Tariffs on China

https://www.barrons.com/news/trump-signs-order-for-20-tariff-on-china-w-house-d6fec57f
23.3k Upvotes

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2.5k

u/GroupKooky Mar 03 '25

China about to sell off 8 trillion in treasury’s tomorrow 😂

73

u/Gitmfap Mar 03 '25

They only have about 700billion

12

u/555-Rally Mar 04 '25

All these dumbass comments above about 8T in ust ...Japan is the largest holder, $3T? 3.5T? China and Russia stopped buying a decade ago...China's just got some long dated they will let expire anyway or hold just for trade collateral to continue.

5

u/James_Rustler_ Mar 03 '25

Is there even enough liquidity for that?

9

u/Gitmfap Mar 03 '25

The bond market for American bonds is strong, people love dollars. Depends on what rate they are though, could end up in a haircut if they are the lower rate bonds.

1.4k

u/michaelt2223 Mar 03 '25

They should just start shooting starlink satellites out of the sky for “security” reasons like we did to their balloons

576

u/HesFromBarrancas Mar 03 '25

China saved Tesla from extinction. Musk is deeply in with the Chinese. Makes the angle here more difficult to discern.

495

u/michaelt2223 Mar 03 '25

Nah China used Tesla in the short term to help their ev business. Now that China has figured out evs they’ve been very open about going after Elon. I don’t think China is to happy with his relationship with the Saudis.

64

u/Illustrious_Read8038 Mar 04 '25

Would love if China banned sales of Teslas.

208

u/SimpleSurrup Mar 04 '25

They don't need to, they're an inferior product there.

They lose on quality, they lose on price, and they lose on brand perception.

Plus keeping them there means they can continue to steal whatever advancements Tesla happens to make on their tech that could prove useful for domestic manufacturers.

126

u/visionsofcry Mar 04 '25

This is the truth. Even other places in the world. I live between 2 countries. I paid $32k for a Chinese car that accelerates like a tesla, has clean engineering like a proper luxury brands, all modern tech, top of the line everything.

Everybody spent decades outsourcing their building of technology to China. Tvs, phones, ev, etc. China is good at it. And like anything, pay cheap and you'll get cheap but also pay a proper fair price and Chinese products are superior.

Chinese learned that greed doesn't work as well as satisfying the masses. They don't need to mark up 10x. They just make a better product and sell 10x more.

I spend on Chinese stuff. Not cheap stuff. I spend good money and they deliver premium products. This coming from a guy who grew up under Reagan and the communist hate.

46

u/Crossfire124 Mar 04 '25

Chinese market has space for every tier of a product. Not just the premium top end and a cheap low end. You definitely get what you pay for

10

u/07bot4life Mar 04 '25

China is good at it. And like anything, pay cheap and you'll get cheap but also pay a proper fair price and Chinese products are superior.

Like the Cheap Chinese earphones are insane. Probably mog anything from a western brand at that price point.

8

u/visionsofcry Mar 04 '25

And those western brands will be made in China to a very large extent.

3

u/07bot4life Mar 05 '25

I mean purely quality wise, like 20$ IEMs made by a chinese brand will be heads above 20$ JBL IEMs.

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u/huhwaaaat Mar 04 '25

KZ earphones are probably the best budget earphones out there, all of their in-ear monitors sounds amazing, even to audiophiles. Where I live, they cost like $6.

3

u/Zourage Mar 04 '25

Funny enough when I was getting into hotas and seeing what's best on the market, constantly saw vkb being damn near the best you can get. Color me surprised when I saw it was a Chinese brand and you have to get it imported.

I'm like, no way. But trusted the market and paid the premium, my god it's a fucking incredible product and well made. Customer service has treated me well on top of it.

Jesus Christ we're fucked aren't we lmao

-12

u/mojomoreddit Mar 04 '25

Idk, you seen to fall too much for that concept there

-11

u/[deleted] Mar 04 '25

[removed] — view removed comment

16

u/SenoraRaton Mar 04 '25

Russian hasn't been communist for almost 40 years? Putin is an oligarch. The right loves their oligarchs, they yearn to become one themselves.

2

u/CocoMelonZ Mar 04 '25

Show me where in Russia the people owns the mean of production. If that's not happening, it's not communism

2

u/federykx Mar 04 '25

Anybody claiming modern day Russia is communist in any way has negative IQ and should be denied the right to vote.

No, they aren't communist. Neither idealistic communist (stateless classless worker-owned democracy) nor historical communist (wholly state-planned, state-owned economy, ruled by a single vanguard party oligarchy).

17

u/Sipas Mar 04 '25 edited Mar 04 '25

Chinese EVs are insane whether you want performance, luxury or affordability. They would outsell everything if they made it to the EU or the US at close to Chinese prices.

5

u/Standard-Ad-4077 Mar 04 '25

You lose on simple research.

In Australia, the Tesla’s sold here are of higher quality than the American made units, they are still not better than what the Chinese put out, AND they are more expensive.

Tesla also relies heavily on the Chinese for batteries, AND BYD just recently announced that it was working with Tesla to phase out ICE vehicles.

2

u/0O00O0O00O Mar 04 '25

I live in a Tier 2 city in China and Teslas are everywhere. We bought a Model 3 in 2020 for cheaper than in the U.S. after they built the new factory (don't hate, this was before all the Musk drama).

At least for now they aren't going anywhere. More and more super chargers are showing up, even in our in-laws tiny Tier 3 city.

But yeah the Chinese ev's have dramatically caught up in just the last 2-3 years.

1

u/Neoliberal_Nightmare Mar 04 '25

I don't think they lose on perception. Unfortunately many Chinese (particularly older people) still automatically assume western = better.

1

u/thicccduccc Mar 04 '25

Anecdotally, I saw a lot of Teslas in China over the summer so they seem to still be quite popular. It wasn't Shanghai but rather another major city so very low foreign population. May still be seen as a bit of a symbol of status as with a lot of Western brands but idk. Definitely still loses to domestic brands by popularity/price/quality as you mentioned.

6

u/SimpleSurrup Mar 04 '25

Coincidence. They got in first. But they had an 8% market share and that's dropping by the day currently at 6%.

I'm sure a lot of that was based on Musk's self-driving hype which I think everyone knows isn't going to happen.

1

u/thicccduccc Mar 04 '25

Yeah, fair enough. One funny thing is Musk seems fairly popular there. I saw his biography being sold at a ton of places and I met a few young Chinese people who said they admired him. Probably just people not knowing enough about him and buying into the billionaire tech genius persona, much like people in the US generally viewed him a few years ago before it was obvious he had gone off the deep end and began asserting himself in places he shouldn't be.

11

u/michaelt2223 Mar 04 '25

They might actually do it. They’re one of the countries that already bans them from certain areas because of the security risks with Tesla. China also wants their own starlink so taking down tesla is also taking down elons money printer. Plus China has the support of Europe now against elon if they ban Tesla they don’t really need to worry about Europe banning chinas evs to protect their Tesla factories in Europe.

3

u/[deleted] Mar 04 '25

[deleted]

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u/michaelt2223 Mar 04 '25

lol the Americans not understanding that the china propaganda they’ve been fed is propaganda

13

u/[deleted] Mar 04 '25

[deleted]

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u/michaelt2223 Mar 04 '25

I’m not dumb enough to think America doesn’t fuck people over. In fact it’s why I know they lie about China. It’s no secret China passed the USA. The only people who don’t know that are Americans

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u/[deleted] Mar 04 '25 edited Mar 04 '25

[deleted]

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u/michaelt2223 Mar 04 '25

I mean yeah kinda. The only reason we didn’t do it is China gave them a better deal. Europe does the same stuff China does it’s what superpowers do. Europe can no longer trust America dude. China is a far better option than America. China will constantly need Europe’s products, money and their tourism. The only reason the Europe didn’t side with China sooner is because of the US military. Europe has long seen China as a good partner and the main worries about China are legal stuff that can be worked out in trade agreements. You don’t think China will be willing to change patent laws, manufacturing regulations and consumer protections if it means hundreds of billions in trade yearly

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1

u/Fluffy-duckies Mar 04 '25

They haven't full on banned them, but some companies are banning employees from buying them out owning them (their own personal cars, not company cars). My guess would be those companies are either being told this by subordinates of Winnie the Pooh.

3

u/HesFromBarrancas Mar 04 '25

Reference on China being open about going after Musk? Genuinely interested.

3

u/citizenshero Mar 04 '25

they’ve been very open about going after Elon

Where and how?

They absolutely love Elon Musk here in China.

3

u/Suspicious_Loads Mar 04 '25

Why would China have a problem with musk and Saudi?

2

u/ShadowTacoTuesday Mar 04 '25

Ok China may not need Elon as much anymore but Elon still really needs China.

2

u/Neoliberal_Nightmare Mar 04 '25

China likes stable reliable partners and Musk is anything but stable.

1

u/daoistic Mar 04 '25

They made them an acceptable product for their governments to buy last year. 

And he still talking about how Taiwan should go to China. 

Don't think the picture is so clear cut.

1

u/bananenkonig Mar 04 '25

"Figured out EVs"

0

u/Dani_vic Mar 04 '25

All I heard is that China EV cars are so much better than Teslas.

3

u/DreamTakesRoot Mar 04 '25

They want to tank the dollar

2

u/HesFromBarrancas Mar 04 '25

Long way to go to make it tank yet.

3

u/Jasonrj Mar 04 '25

China has BYD now. Musk is in their way.

2

u/SuperF91EX Mar 04 '25

You spelled California wrong.

1

u/r2k-in-the-vortex Mar 04 '25

Musk has not demonstrated much care for wellbeing of Tesla as of late.

1

u/hockeyschtick Mar 04 '25

He never trolls China. Just sayin.

1

u/DigDugged Mar 04 '25

No one can figure out what this Apartheid South African white supremacist roman salute guy has against the chinese

1

u/OpenSourcePenguin Mar 04 '25

Exactly. He calls everyone in the West a dictator and spouts BS about free speech.

However, Absolutely no opinions about China

8

u/beepvoop Mar 04 '25

Wow. Hard to believe this is a comment from an American.

-6

u/michaelt2223 Mar 04 '25

Not really starlink is a bad product, run by a horrible individual, steals tax dollars and returns nothing to the people. It’s quite literally a pointless drain on American tax payers all to fund the biggest loser on the planets bottomless pit of an ego

6

u/beepvoop Mar 04 '25

Ah, so because you disagree with the use of funds and who it is, etc, you think a communist country should shoot yours, and our, satellites out of the sky. Genius thinking. By this logic, you should have no problem with any outrageous actions by right or left.

1

u/michaelt2223 Mar 04 '25

Yes I think long term it’s better for all Americans if we shoot down starlink and replace them with an actually good product. Verizon and AT&T are both working on much better satellite tech which is why Elon is trying to push through as many starlink contracts as possible right now

1

u/beepvoop Mar 05 '25

OK, and when they can do what he’s done in the same or better capacity then I’ll agree with you until then. Get your head out of your ass and start thinking straight.

1

u/michaelt2223 Mar 05 '25

They already can. Elon is a Conman why are you so stupid isn’t it painful?

3

u/whiteflagwaiver Mar 04 '25

The amount of space debris that would cause would make that infinitely NOT worth it.

-4

u/michaelt2223 Mar 04 '25

Wrong. First off his satellites are designed to disintegrate into the atmosphere at some point. Also we’ve found his satellites are causing issues with the ozone layer already so better to just get rid of them now before they cause more damage

3

u/whiteflagwaiver Mar 04 '25

Did Astronomy in Uni, but I'll do the simple googling for you.

"The Chinese FengYun-1C engagement in January 2007 alone increased the trackable space object population by 25%."

Yeah great idea, lets blow up hundreds of satellites! Won't cause any issues for future space flight in the least.

All orbits decay, the time scale is what's most important.

-2

u/michaelt2223 Mar 04 '25

Blowing up the satellites would knock them out of orbit and they’d disintegrate in the sky. You could even predict debris fields. Elons already polluted the atmosphere they’re gonna be there no matter what and he wants to keep sending more. Plus his competitors will send more too. It’s the old 2 birds with 1 stone for China

3

u/onlyasimpleton Mar 04 '25

Their low altitude spy balloons???

Significantly different than communications satellites in LEO

1

u/michaelt2223 Mar 04 '25

Not really. Which is why the US refused to shoot them down until China allowed it

0

u/onlyasimpleton Mar 05 '25

Spy satellites suspended by balloons could not be more different than a starlink communications satellite.

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u/[deleted] Mar 04 '25

[removed] — view removed comment

1

u/design_by_hardt Mar 04 '25

They should use the Red Coast antennae!

1

u/morganrbvn Mar 04 '25

The balloon was at least in US airspace tbf

0

u/michaelt2223 Mar 04 '25

And those satellites are a security threat to China. Time to get them out of the sky

1

u/r4rthrowawaysoon Mar 04 '25

Elon does whatever they ask, they won’t shoot starlink down when they can have him puppet dumbold into whatever position they want.

1

u/TimAllensBoytoy Mar 04 '25

Spicy take, im going to spread this as truth to my coworkers lol

1

u/spinningwalrus420 Mar 04 '25

China is already holding simulations where they take out hundreds of Starlink satellites. They'll be ready for that IRL, but in the meantime, China is just going to compete and likely overtake SL by launching their own version called Qianfan oe "Thousand Sails" and they plan on putting 15,000 of them into orbit. It might be better.

1

u/Void_Speaker Mar 04 '25

Elon is in China's pocket and has an office in the White House. Why the would they want to fuck over such an amazing asset?

Russia has Trump, China has Elon, wonder who Americans have...

-1

u/really-stupid-idea Mar 03 '25

That would be funny as fuck if any country started doing this. Target practice.

13

u/MidnightGleaming Mar 04 '25

That wouldn't be funny at all, it would be the end of space as a cooperative area of exploration and science.

Honestly, fuck your opinion.

-7

u/mischling2543 Mar 04 '25

Has to happen eventually man

16

u/MidnightGleaming Mar 04 '25

Literally no it doesn't.

1

u/MOUNCEYG1 Mar 04 '25

It could just not happen though?

0

u/[deleted] Mar 04 '25

[deleted]

1

u/MidnightGleaming Mar 04 '25

Aspire to be more, to be better, or revel in your own filth.

4

u/lemmegetadab Mar 04 '25

Did you eat paint chips when you were a kid or something?

0

u/overtoke Mar 04 '25

a hacker could deorbit the entire constellation

1

u/michaelt2223 Mar 04 '25

Yeah gotta think someone’s gonna do it someday. Teslas are nowhere near secure, PayPal was never secure, Twitter isn’t secure, and doge got hacked. The guy has a pretty bad history with cybersecurity

0

u/rodrigo8008 Mar 04 '25

jokes about starting ww3 are funny haha lol haha!!

1

u/michaelt2223 Mar 04 '25

Our president literally tried to blame the guy who got invaded for starting WW3.

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u/rodrigo8008 Mar 05 '25

Has nothing to do with my comment but thanks for sharing

-2

u/Rise_Up_And_Resist Mar 04 '25

This isn’t even a joke. It’s absolutely what they should do. 

-2

u/michaelt2223 Mar 04 '25

I wasn’t joking and I don’t think it’s really that far away. We just need 1 connection to Putin from Elon and it could happen. The only thing stopping it right now is the us military.

172

u/c4plasticsurgury Mar 03 '25

What does this mean? I’m too regarded to understand.

419

u/LucaSeven7 Mar 03 '25

China has a large portion of their national reserve in USD. That's the treasury he's probably referencing but im on this sub so take it with a grain of meth.

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u/i_am_voldemort Mar 03 '25

China buys and holds US Treasury bonds. Selling them all at once would devalue T bonds.

Others countries with paper hands would probably sell their US treasuries, making US Treasury bond values drop more in a positive feedback loop. Selling lowers prices which leads to more selling which leads to lower prices.

Bond prices and yields are inverted, so a falling price would raise interest rates on those bonds with a second order effect of increasing overall interest rates charged to consumers. So interest rates go up.

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u/hockeyschtick Mar 04 '25

Bonds are like a Rube Goldberg machine. That’s why I stick with simple, safe things like option spreads.

4

u/goomunchkin Mar 04 '25

This made me lol

6

u/docbauies Mar 04 '25

Who are they selling them to? When the US owes you 8 billion dollars, the US has a you problem. When the IS owes you 8 trillion dollars, you have a US problem.

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u/mitchell_johnsons_mo Mar 04 '25

Who are they selling them to? When the US owes you 8 billion dollars, the US has a you problem. When the IS owes you 8 trillion dollars, you have a US problem.

Try again Michael Scott

1

u/docbauies Mar 04 '25

Please proceed to tell me who they will sell to

1

u/mitchell_johnsons_mo Mar 04 '25

I was pointing out that you fucked up the joke lol

1

u/SpellingIsAhful Mar 04 '25

There's a secondary market for us bills. It's global

1

u/docbauies Mar 04 '25

And who is buying 8 trillion in T bills?

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u/SpellingIsAhful Mar 04 '25

The market, at a reduced price

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u/myfotos Mar 04 '25

K, but and then? (Still regarded here on my side)

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u/mischling2543 Mar 04 '25

High interest rates = less money available for investment = stocks go down

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u/aManPerson Mar 04 '25

say the original government Treasury bond was 4%. (these numbers won't all fit together correctly, but i am guessing at all of their final numbers so you get an idea of how they relatively all work together).

and lets say a 10 year bond, of $10,000, would end up with $15,000 . you could buy one from the government for $10k. and on the open market, you might be able to sell it right away for something like $11k. even though it wont give you the full 15k value for another 10 years.

so all other "10 year 4% interest rate bonds are also worth that same 11k right now".

BUT, if china sold A SHIT TON, of the "10 year 4% bonds" they own, they would no longer be worth 11k right now. they would be worth maybe 10.5k. (even though 10 years from now, they would still be worth 15k).

so if any company, or thing wanted to sell a bond, right now, and generate money from it, they would have to compete with ALL of those cheaper "10 year 4% bonds" that china just sold. how do they do that? by selling something with a higher value:

10 year bond with 5% interest rate

and now interest rates have risen.

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u/Tereanoch Mar 04 '25

So, it has to do with the second hand market for T bonds and how the US will raise money.
If the tbond values go down, people will just buy Tbonds because they are guaranteed a certain sum down the line. But if it goes down below a certain point where you make more money buying a second hand bond compared to buying it off of the US treasury, the the US has to raise interest rates to stay competitive with their own bonds. T bills are how the US raises money for government spending.

For eg:- if a tbond is worth $100 and the US guarantees a 10% interest per annum for 10 years. Then you would get 200 at the end of 10 years. Interest is paid out every six months and principal is returned after 10 years

Lets say China buys this. And they want to sell it after 5 years. So china has received $50 interest for the bond already and now it's worth 150 currently ( 100 principal and 50 remaining interest) Lets say China has 10 million such bonds for example.

China wants to get rid of the bonds now and decides that they want to go scorched earth on them. They list the bonds for sale at $95. This is where the problem starts. England looks at the $95 bond and see. Hey I can make $55profit (5 profit on principal because they'll get $100 back at the end of 10 years and 50 in interest) instead of $50 profit in interest if I buy the bond from China instead of the US. So England stops buying bonds from the US and buys them directly from China. To stay competitive, the US has to raise interest rates to 11% so that they're not outpriced by the second hand market. Imagine this on a much larger scale.

This hinges on the fact that the bond holder wants to dump the bonds at an amount slightly lower than the principal.

5

u/beb0p Mar 04 '25

Thank you. This was very helpful in understanding the situation.

1

u/c4plasticsurgury Mar 07 '25

Whoa that’s fucking crazy man. How did you learn that.

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u/Noddite Mar 04 '25

Real answer, they wouldn't because those bonds are what help prop up the weak Yuan in China. And if they dumped them, apart from the normal loss they would cause their investment to further devalue...with little to no effect on the US.

The smart play is they just stop buying them as they mature.

1

u/sopunny Mar 05 '25

China holds a bunch of IOUs from the US treasury. If they sell them for cheap, it makes it more expensive for the US to borrow money by making it harder to sell new IOUs

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u/crjsmakemecry Mar 04 '25

You’re making the 🌈🐻 so hard with those words

4

u/aManPerson Mar 04 '25

ya, one thing i don't like about financial stuff. the actual concepts are not too hard. but then there are all these other terms used and it sounds like a foreign language. take a look at my other comment here.

1

u/TheDakestTimeline Mar 04 '25

Basically faith in the full credit of the US govt goes down

1

u/mmoonbelly Mar 04 '25

But they don’t want to devalue the dollar. If anything they need it to inflate in value. That way the cost to produce in China in Yuan stays the same, the sales price in the US stays the same in US$ they inflate the tariff away.

1

u/eddie7000 Mar 04 '25

America would retaliate by confiscating all Chinese owned land in the USA. Or something like that.

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u/i_am_voldemort Mar 04 '25

The Chinese owned land is under various American companies including Smithfield Foods, Brazo Highland Properties LP, Walton International Group, and Harvest Texas LLC.

Since these are ostensibly American companies the government would run headlong in to 5th Amendment Takings Clause issue trying to seize it. With the current textualist Supreme Court I don't know if the administration would win on it.

They'd have better luck taking it under eminent domain, but then you'd be paying China money...

Additionally, Smithfield in particular is a huge farming/produce/meat conglomerate with lots of brands in major supermarkets. Start fucking with its operations and there would be ripple effects into the supermarket aisle.

1

u/eddie7000 Mar 06 '25

If war breaks out that land is gone. The government would do a deal with the American partners and both would make money.

0

u/Basket_cased Mar 04 '25

I thought China tried that during the 2008 financial crisis and the fed just turned on the money printers and laughed in Xi’s face

12

u/Optimal-Golf-8270 Mar 04 '25

China bought debt in 2008 didn't they? They sold around 2016. They're selling USD to buy gold, about 100 tons a year for the last 20 years.

This idea that China and the US are in a second cold war is entirely one sided. They're just doing their own thing while we destroy ourselves fighting the ghost of Stalin.

3

u/huhwaaaat Mar 04 '25

China would never sell off the treasury bond (at least in its current state still being the world's no.2) because it would cripple the US economy and it will force the US to take drastic actions against China. China is trading with a $300 billion trade surplus, crippling the US economy doesn't benefit itself. However, they are no longer buying as much treasury bonds as before, instead just keeping the US dollar in their own treasury. They are trying to remove their reliance on the US dollar hegemony. This rejection of USD hegemony is also why the trade war started to begin with, and why Biden didn't remove the tariffs from Trump's reign when he took power over him. Losing the USD hegemony and the power it has to tax the world would mean losing everything for the US.

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u/Optimal-Golf-8270 Mar 04 '25

They wouldn't sell them all off in one go ala the US with British bonds during Suez. They are selling them off, that's kinda indisputable fact. They've sold 400 billion over the last 8 years. Sold 400, bought 100.

What's always interesting about this kinda thing is that in attempting to maintain pax Americana, they've put themselves in a much worse position going forward. Could have just been comfortably the senior power in a multi-polar world. Instead they're crippling themselves, and forcing China to become self reliant.

Like what did they think was gonna happen when they sanctioned China's access to chips? They'd fold? Obviously they're gonna pour cash into development. And now it's, oh shit, actually we can't build chips either. Well done, you've put them in a stronger position whilst costing yourself hundreds of billions to subsidise a foreign company who aren't gonna share IPs with you. Genius move.

1

u/huhwaaaat Mar 04 '25

They probably thought that China would fold like Japan did in the 80s, first the VER to limit Japan's automotive industry, then the Plaza Accords, then the semiconductor export ban. Ofc in the 80s US was basically the sole power, and Japan's economy would suffer greatly if it did not do what was told. Even China didn't dare to oppose the US back then when it bombed its embassy, only sputtering off a few words in a press conference. But what is funny is that they seem to have no long term vision in every single one of its foreign policy; tariffs and export/import bans is good for short term protection of your industry, but then they don't do anything to revitalise their industry to try to compete with China, leaving it to stagnate. So you don't want to go back to being an industrial powerhouse, but you also don't want anyone being an industrial powerhouse. So focus on being an innovative economy instead, but even then they are still starting to lose the lead on China.

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u/Optimal-Golf-8270 Mar 04 '25

Very true. Always thought the prophecies of collapse over their housing bubble were pretty funny. They've successfully done what Japan tried to do. Shock horror, it was the right thing to do, bailing out real estate cripples your country for almost literally no upside. Who'd have thunk it. It's supposed to be capitalism, if they bite off more than they can chew, too fuckin bad. Spend the rest of your life paying back your debtors, zero governmental help.

I don't think they can reindustrialise without shock therapy, and no one wants that. That's the thing about all of this, Trump announces tarrifs, sure whatever, stupid, but could be part of a larger plan. And there's nothing. More subsidies to farms, but that's it. Xi is about to announce a massive stimulus package in response to the tarrifs. Probably been working on the long-term planning since November. When the tarrifs come they're ready to go next day. That kinda planning just doesn't exist anywhere in the West anymore.

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u/i_am_voldemort Mar 04 '25

Yes but then the fed devalues the US dollar and increases inflation.

Tbh China doesn't have to do anything, just threaten to do it, like they did last time.

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u/A_Light_Spark Mar 04 '25 edited Mar 04 '25

Great explanation, although I'd suggest that "positive feedback loop" usually refers to something that goes up. I know you mean the selling force is a positive feedback, but generally we are talking about the price which is a negative feedback loop.

Edit: I'm a regard

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u/PrizeStrawberryOil Mar 04 '25

You're wrong on your application of the terms.

Negative feedback causes the system to become more stable. Positive feedback causes the system to become unstable.

Negative and positive don't have anything to do with whether something goes up or down.

2

u/comFive Mar 04 '25

You should bet on a grain of fentanyl, it’s far more potent than

1

u/agoodusername222 Mar 04 '25

just do old school heroin, gives a stronger high :), and also that way it can drag out your corpse for longer

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u/PM_ME_WHOEVER Mar 04 '25

China has been allowing their treasury positions to come to maturity without re buying. Their holdings are being steadily decreasing. Japan is again the largest US debt holder.

1

u/BlackBobbyAxelrod Team Rhodes Mar 04 '25

LOLZ

1

u/averysmallbeing with matching small .. y'know Mar 04 '25

I could use a grain of meth right now 

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u/draycr Mar 03 '25

It means that China could sell off 8 trillion in treasury’s tomorrow.

Don't worry about being regarded, always happy to help 😎😎

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u/c4plasticsurgury Mar 03 '25

…I think you are more regarded than me.

2

u/Vaug0024 Mar 04 '25

Warmest Regards!

1

u/_name_of_the_user_ Mar 04 '25

I mean, it's a pretty low bar

3

u/[deleted] Mar 03 '25

8T kg or pounds ? Regard me too

1

u/pronouncedayayron Mar 03 '25

treasuries are dollars not pounds

0

u/[deleted] Mar 03 '25

Aren't they minerals?

2

u/oberynmviper Mar 03 '25

Actually being regarded means you are blissfully unaware.

Which is nice right now. I may see all my reds as GOOD!

4

u/dalmathus Mar 03 '25

When the US goverment decides to take on another $4 trillion in debt every 4 years who do you think they go in debt to?

They print a big IOU called a treasury that you me or XI Jingping can buy and they promise to return x% per year.

Most countries buy up these IOU's right away because the US has never defaulted on its debt, they have never missed an interest payment.

OP here is suggesting that China is likely to assume that this trend may be coming to a close (btw if they do miss a debt payment its Joever for the world) and will put all their held interest generating IOUs on the market for other countries to purchase.

This would make the new debt the US just posted harder to sell and crash the USD as a result.

1

u/Alone-Amphibian2434 Mar 04 '25

Most of the us debt is held domestically. Only like 22% is foreign debt.

1

u/Tombot3000 Mar 04 '25

It means nothing because that's not how treasury bonds work. They're not a mafioso loan to be called in at any time - they're a fixed term investment vehicle that the US decides when you can cash it in at time of purchase.

1

u/Tha_Sly_Fox Mar 04 '25

Start hoarding pennies, they’ll be in short supply soon

1

u/Real-Sherbet-8198 Mar 04 '25

Basically, almost all countries are lenders to the USA, and they might start cutting back on their loans, in addition to reducing their USD reserves. So when the time comes for the U.S. federal government to pay its debts, it could default. This is on top of your question. Beacuse relationship to your allies is going to shit.

Almost all countries hold USD as part of their national treasury reserves, which contributes to their purchasing power. However, if they start seeing the USD as a weak currency that nobody wants to use for trade, its purchasing power for goods and services will decline. This would make the USD less desirable, leading countries to prioritize transactions in their own currencies instead, strengthening their local currencies relative to the USD. As a result, the USD would weaken, making American products more expensive.

So, what's the snowball effect? Tariffs + a reduced willingness to trade in USD + government default due to worsening international relations and fewer willing lenders = exponentially rising consumer prices for Americans. Think eggs are expensive now? Wait 1–3 years if this trend continues—things could get really bad.

It's one thing to piss of your enemy's and it's a REAL SHITTY IDEA to piss of your allies.

3

u/BUNNIES_ARE_FOOD Mar 03 '25

That means yields will skyrocket right? At least somewhere to put our cash?

2

u/bNoaht Mar 04 '25

They don't even own 1 trillion

2

u/BeHippyNow Mar 04 '25

Naw they are going to announces fabs and foundries capable of producing Nvidia level chips in greater quantities for lower cost. That would be the end of western markets. 

2

u/fakieTreFlip Mar 04 '25

treasuries*

1

u/GroupKooky Mar 04 '25

Yeah that’s what I meant honestly 😂

1

u/12baakets Mar 03 '25

Calls believe it or not

1

u/Competitive-Union721 Mar 03 '25

Who's going to buy them?

1

u/AcrobaticMission7272 Mar 04 '25

That would be dumb because treasuries are only due at maturity. So hypothetically selling 8 trillion on the secondary market would get them steep losses.

But china only owns 700 billion something in US treasuries anyway.

1

u/mojomoreddit Mar 04 '25

Why is that????? 

1

u/LurkerP Mar 04 '25

The bagholder here is not china. Its us. Americans hold most of americas debts.

1

u/KingMelray Mar 04 '25

Do they own that much?

1

u/bigtime2die Mar 04 '25

I really wonder what would happen if china would just say , f usa.. we selling all their debt

1

u/Financial-Code-2163 Mar 04 '25

Chase, Morgan, Goldman, and Citadel all will start buying...

1

u/Lolkac Mar 04 '25

They need that for functioning economy. This is horrible news for Europe and manufacturing in Europe as China will push everything us can't buy to Europe. Which will lower prices and decrease local manufacturing ability. Trump literally destroyed economic balance in the world.

1

u/LiamsDad Mar 04 '25

They've already been selling and reducing position, around 750billion. Currently around 1/2 of all time high,

1

u/allwordsaremadeup Mar 04 '25 edited 29d ago

Wasn't Trump like, not gonna pay interest on bonds held by Gina? Basically making the US insolvent on purpose? Moody's should have put the whole clowncar of a country at the level of Swaziland just for floating that.

1

u/Typical-Phone-2416 Mar 04 '25

Why the fuck would they burn 8 trillion of their own reserves value?

1

u/Key-Banana-8242 Mar 05 '25

That would not hurt the US if they had this many but they won’t, becuase treasuries are a place to offload USD, USDthat China needs for international trade stil

1

u/loli_popping Mar 03 '25

they are going to replace it with gold. gold etfs are going to pop