Group 1 - China has reduced its holdings of US Treasury bonds for the third consecutive month, with the amount falling to the lowest level since 2009, totaling $767.4 billion after a decrease of $7.6 billion in March [1] - In contrast, Japan increased its holdings by $19.9 billion to $1.19 trillion, while the UK raised its holdings by $26.8 billion to a record high of $728.1 billion [1] - Concurrently, the People's Bank of China has been making significant purchases of gold, indicating a strategic shift in asset allocation [1][2] Group 2 - China's strict control over domestic gold flows has led to a record import of 127.5 metric tons of gold in April, marking a 73% increase, alongside a new record of 11.5 metric tons of platinum imports [2] - Analysts highlight that the US is facing a structural crisis of dollar credit and debt, with long-term fiscal deficits leading to an imbalance in Treasury supply and demand, posing threats of economic recession and hyperinflation [3] - The importance of gold as a stable asset to hedge against dollar volatility is emphasized, as China aims to diversify its foreign exchange reserves and reduce reliance on US Treasury bonds [6][8] Group 3 - The ongoing reduction of US Treasury holdings by China may exert additional pressure on the US economy, signaling a decline in confidence in dollar assets, which could lead to a cautious approach from other investors towards US debt [8] - The historical context of US presidents expressing concern over rising national debt without taking substantial action is noted, with the current national debt reaching an alarming $36 trillion [6] - The internationalization of the renminbi is accelerating as China's economic influence grows, necessitating a diversified foreign exchange reserve system [6][8]

Core Viewpoint - Moody's has downgraded the U.S. sovereign credit rating from Aaa to Aa1 due to deteriorating fiscal conditions, while the White House continues to push for a large tax cut that may increase federal debt by trillions of dollars [1] Group 1: U.S. Debt Situation - The total U.S. federal debt has surpassed $36 trillion, with approximately one-quarter of this debt maturing within the current year, heightening the risk of federal debt [1] - Analysts indicate that the U.S. is trapped in a structural dilemma of dollar credit and debt crisis, with long-term fiscal deficits leading to an imbalance in the supply and demand of government bonds [1] - The crisis is characterized by a persistent state where the supply of U.S. Treasury bonds exceeds demand, which is likely to result in rising bond yields [1] Group 2: Economic Implications - The U.S. government and financial sector have been depleting dollar credit over the years, with the extent of damage to the dollar being difficult to quantify [2] - The issuance of government bonds and quantitative easing aimed to rescue the economy from crises, leading to a phase where the economy is in a state of stagnation [2] - There is a growing concern that a loss of confidence in U.S. national credit may trigger active selling of U.S. Treasury bonds, which has already begun to manifest [2] Group 3: Future Risks - If the debt ceiling is not raised, the U.S. could face economic recession and a "debt cliff" scenario; conversely, raising the ceiling would lead to an accumulation of debt that may require solutions like direct money printing, potentially causing hyperinflation [2] - The U.S. is caught between the threats of economic recession and inflation, which will further exacerbate the risks associated with U.S. Treasury bonds [2]