Foreign investors sell U.S. assets - HERE WE GO FOLKS

[clem_c_rock]

http://www.theglobeandmail.com/servlet/story/RTGAM.20050516.wusdollar0516/EmailBNStory/Business/

Enjoy the happy times while they last.


<snippit>
nternational investments in U.S. securities dropped to $45.7-billion (U.S.) in March from $84.1-billion in February, the U.S. Department of Treasury said Monday, further evidence that foreign central banks may be diversifying their holdings away from U.S. assets.
</snippit>

[Spazito]

1. Whoa, from 84 billion to 46 billion, almost cut in half

yikes.

[SmokingJacket]

2. Whoa.

I know nothing about finance, but this seems like a massive drop.

Someone who knows something, please chime in.

[Anakin Skywalker]

3. I Know Something.

Bush 3:16 says "The economy is strong". :)

[Spazito]

6. Foreign investment is what has been holding up the US economy

here are some snips from the article that may help clarify what it means:

The March inflows fell well short of the $70-billion economists polled by Bloomberg had expected. Moreover, it is below the $65-billion to $75-billion that is needed to cover the U.S. current account deficit and outflows of foreign direct investment, according to a report by Adam Cole, senior currency strategist at RBC Capital Markets in London.

Overseas central banks were net sellers of U.S. assets for the first time since September 2002, he wrote. March's selling of U.S. dollar-denominated assets by official holders was the largest since August 1998, he said.

snip

With foreign central banks retreating from Treasuries, and U.S. investors showing a growing interest overseas, this report highlights the lingering downside risk to the U.S. dollar, despite the greenback's recent rally,” wrote Sherry Cooper, chief economist at BMO Nesbitt Burns, in a note. “Hedge funds are not a currency's best, long-term friend.”

Speculation has risen this year that Asian central banks are diversifying their holdings away from U.S. assets. Between 70 and 80 per cent of the U.S. economy's borrowing requirement is being met by foreign, mainly Asian, central banks, Harvard professor Niall Ferguson wrote in the New York Times earlier this year.


(The only way the US can attempt to entice them back is to raise interest rates to make the dollar attractive over the concern of the massive debt and that is getting harder and harder to do. My comments)

[Just Me]

7. I'd like to know who's buyin' 'em,...prolly our own eating us alive.

Wouldn't that piss people off!

OR what if,...oh, good lawd, these thoughts are too scary,...MUST.STOP.NOW.

[Spazito]

8. It is 'Caribbean' investors, lol

"On the other hand, foreign private investors, such as hedge funds, flocked to U.S. assets in March."

You know the ones who locate their 'businesses' via post office boxes in places like the Bahamas, etc, lol

[Just Me]

19. Yep!!! Is there a way to ascertain precisely whom is buying?

Naturally, the thought that US multinationals are prepared to piss all over their own country, their own people is terribly unsettling although, for me, simply not surprising.

[Spazito]

20. I think the key word you use is 'multinational', profits above all

they will piss all over whomever and whatever is needed to ensure their survival. There is no such thing as loyalty of any kind with multinationals.

[donkeyotay]

9. I don't understand what happens

There was a shortfall between inflows and the current account deficit, which is what people have been saying might eventually happen. Well, it finally happened, and what happened? Nothing. I don't get it. Where is the shortfall? Who covered it. I don't get it.

[Spazito]

14. It means, bottom line, interest rates must go up

because foreign investors no longer consider the US dollar, the US economy stable and profitable.

[carnie_sf]

4. So it begins

[Just Me]

5. (((yikes))) Well, we knew this was coming.

I've already spent all my worry over it.

[Lannes]

10. OPEC could also hurt us.

If the US invades another middle-eastern country(or two)OPEC might start tying oil to the Euro instead of the Dollar.We would be in big trouble.They are already considering it because they would profit more from the switch.

[Just Me]

11. I'm uncertain about the deals behind the curtains of OPEC.

It could single-handedly take down Bushco or help Bushco incite the neoCON world war. I'm not sure whether there are more than a handful of independents from corporacrats. I just dunno.

[Fone Book]

15. did you read "Confessions of an Economic Hit Man"?

if not, you should

[Just Me]

16. Yes, I have,...and I plan to give it as a gift to everyone I know.

It perfectly summarizes the "big picture" and the role our corporacratic government has played in perpetuating even causing horrific human misery.

[Roland99]

12. I thought that was Asian investments with Caribbean interests buying

[Spazito]

17. The key is it is hedge fund 'private' foreign investors

that makes it very interesting, imo, not to mention worrisome.

Definition of Hedge Funds

A fund, usually used by wealthy individuals and institutions, which is allowed to use aggressive strategies that are unavailable to mutual funds, including selling short, leverage, program trading, swaps, arbitrage, and derivatives. Hedge funds are exempt from many of the rules and regulations governing other mutual funds, which allows them to accomplish aggressive investing goals. They are restricted by law to no more than 100 investors per fund, and as a result most hedge funds set extremely high minimum investment amounts, ranging anywhere from $250,000 to over $1 million. As with traditional mutual funds, investors in hedge funds pay a management fee; however, hedge funds also collect a percentage of the profits (usually 20%).

[pretzel4gore]

13. it's proof the stock market is being manipulated...

how on earth could the Dow go up 73 points when all that terrible economic truth percolates in the background? and don't say the moneymen aren't aware of it, or deluded....
economic armageddon predicted:
http://business.bostonherald.com/businessNews/view.bg?articleid=55356

[Canuckistanian]

18. The "Invisible Hand" at work, just as envisioned.

Live by the market, die by the market.

[whistle]

21. Aren't all assets in the U.S. worth about $105 trillion, so even....

...if this continues at the rate of $60 billion every month, that will be less than 1% of all U.S. assets by the end of the year. So foreign investors represent about what 15% or 20% of total investments, maybe. The ultra wealthy will have to go back to focusing on screwing only middle class Americans again and that will start the revolution! :popcorn: