Neils ChristensenNeils Christensen has a diploma in journalism from Lethbridge College and has more than a decade of reporting experience working for news organizations throughout Canada. His experiences include covering territorial and federal politics in Nunavut, Canada. He has worked exclusively within the financial sector since 2007, when he started with the Canadian Economic Press. Neils can be contacted at: 1 866 925 4826 ext. 1526 nchristensen at kitco.com @Neils_cShareDisclaimer: The views expressed ...

Renowned economist Mohamed El-Erian has signaled a major structural shift in global finance as China's share of the U.S. Treasury market plummeted to a 15-year low, raising concerns over future demand for American debt. Great Retreat Data shared by El-Erian reveals that China's holdings of U.S. Treasuries now represent just 7% of the total market share—a staggering drop from the 28% peak recorded 15 years ago. The total holdings have fallen to approximately $682.6 billion, the lowest level since 2008. “A ...

Core Viewpoint - Renowned economist Mohamed El-Erian indicates a significant structural shift in global finance as China's share of the U.S. Treasury market has dropped to a 15-year low, raising concerns about future demand for American debt [1] Group 1: China's Holdings of U.S. Treasuries - China's holdings of U.S. Treasuries now account for only 7% of the total market share, a dramatic decline from the 28% peak recorded 15 years ago [2] - The total value of China's U.S. Treasury holdings has fallen to approximately $682.6 billion, the lowest level since 2008 [2] Group 2: Broader Economic Context - The decline in China's Treasury holdings is occurring alongside a steady issuance of new securities by the U.S. government, which may exacerbate the situation [3] - As the U.S. national debt approaches $39 trillion, China is reportedly advising its domestic banks to limit exposure to Treasury securities and shift towards gold and other hard assets, with gold reserves reaching a record 2,308 tonnes [4] Group 3: Geopolitical Implications - Analysts suggest that this de-risking strategy is a direct response to the weaponization of the dollar, particularly following the freezing of Russian assets in 2022 [5] - The reduction in China's stake in U.S. Treasuries signals a permanent shift away from being the primary financier of American deficits [5] Group 4: Impact on U.S. Economy - El-Erian raises concerns about who will absorb the increasing supply of U.S. debt as traditional buyers like China retreat, which could lead to higher borrowing costs for the U.S. government [6] - If foreign demand continues to decline while the U.S. maintains a trillion-dollar trade deficit, this could put upward pressure on interest rates, threatening the stability of the global financial system [6] Group 5: Market Reactions - Economist Peter Schiff suggests that China's actions may compel the Federal Reserve to purchase more bonds, potentially leading to inflationary conditions for consumers [7]

According to Fortune, BlackRock has announced its first venture into decentralized finance (DeFi), launching its BUIDL token, backed by U.S. Treasuries, on Uniswap in collaboration with Securitize. As part of the deal, BlackRock also acquired UNI tokens. The BUIDL token, with a market cap of $180 billion, will initially be available to qualified institutional investors. This collaboration marks a significant step in bridging traditional finance with the DeFi space.https://t.co/eiXBOqsPKu ...

⚡️ JUST IN: OKX says tokenization is accelerating as over $10B in U.S. Treasuries are now onchain, signaling growing adoption of real-world assets in 24/7 digital markets. https://t.co/2nYNsUzVTA ...

Chinese regulators have told financial institutions to limit their purchase of U.S. treasuries amid concentration risks and market volatility. Those with high exposure to the bonds have been advised to reduce their holdings, reported Bloomberg on Monday. Notably, the advice is not applicable to Chinese state holdings of U.S. government bonds. The publication reported that the directive had been issued to the financial institutions before the recent call held between President Donald Trump and Chinese Pres ...

Core Insights - U.S. Treasuries face potential losses as Chinese regulators advise financial institutions to limit U.S. government bond holdings due to market volatility concerns [1] - The guidance targets banks with significant U.S. debt exposure, encouraging them to reduce positions without specific targets or timelines [2] - China-based investors' Treasury holdings have decreased to $682.6 billion, the lowest since 2008, down from a peak of $1.32 trillion in 2013 [3] U.S. Debt Rating and Fiscal Concerns - Moody's downgraded the U.S. sovereign credit rating in May 2025, citing concerns over the $38.6 trillion debt burden, following similar actions by Fitch and S&P [4] - Rising 10-year Treasury term premiums indicate that markets are pricing in greater long-term fiscal risk, with the Term Premium rising from negative 0.4090 in February 2021 to 0.6148 in January 2026 [5] Suggested ETF Investment Strategies - Defensive Fixed Income Exposure: Short-Term Treasuries like Vanguard Short-Term Treasury ETF (VGSH) yield 3.96% annually [6] - Diversification with Investment-Grade Corporate Bonds: iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) yields 4.48% annually [7] - International and Global Diversification: Vanguard Total International Bond ETF (BNDX) yields 4.39% annually, while iShares J.P. Morgan USD Emerging Markets Bond ETF (EMB) yields 4.93% annually [8] Tactical Plays on Rising Yields - China’s potential reduction in Treasury exposure may lead to higher yields and increased fiscal risk [8] - Inverse Bond ETFs like ProShares UltraShort 20+ Year Treasury (TBT) can profit from rising long-term yields [9] - Floating Rate Bond ETFs such as iShares Floating Rate Bond ETF (FLOT) yield 4.78% annually, adjusting coupon payments with interest rates [9] Equity Market Protection - Dividend-Paying Equity ETFs like VYM and SCHD provide stability and income during bond market volatility [10] - Low Volatility Equity ETFs such as SPLV and USMV can cushion against equity market swings linked to fiscal instability [10]

According to Bloomberg, Chinese regulators have recently verbally instructed some large commercial banks to limit new purchases of U.S. Treasuries and asked banks with higher exposure to gradually reduce their holdings, citing concentration and market volatility risks. The guidance does not apply to China’s sovereign reserves, is limited to commercial banks, and sets no specific targets or timeline for adjustments. https://t.co/frgBCgjMVO ...

Core Insights - The Federal Reserve's current stance suggests that cash yields will remain stable in the near term, with safe cash options offering attractive returns [2][3] - Various cash products, including savings accounts, CDs, brokerage cash options, and U.S. Treasuries, provide yields ranging from the low-3% to 5%, allowing for solid returns without stock market risk [3][9] - A comprehensive chart has been created to compare the best-paying options across major cash categories, highlighting standout rates for high-yield savings accounts and competitive returns from CDs and Treasuries [4][12] Cash Yield Analysis - Cash options are delivering competitive yields in the 3%–5% range, with the best accounts providing strong returns with minimal risk [9][10] - For a $10,000 deposit, interest earnings can vary significantly based on the chosen account's APY, with potential earnings of $198 at a 4% rate over six months [7][8] - The table illustrates earnings for different balances ($10K, $25K, $50K) at various APYs, showing that higher rates can substantially increase earnings [8][10] Product Categories - The top cash options fall into three main categories: bank and credit union products (savings accounts, MMAs, CDs), brokerage and robo-advisor products (money market funds, cash management accounts), and U.S. Treasury products (T-bills, notes, bonds) [12][16] - Each category has different trade-offs regarding yield stability and flexibility, allowing investors to choose based on their goals and timelines [12][13] - Current rates from federally insured banks and credit unions are analyzed, providing insights into the best available APYs [14]

Core Viewpoint - The world is entering a "capital war" where financial resources are weaponized, leading to potential widespread conflict among nations [1][2]. Group 1: Capital War and Global Tensions - Ray Dalio warns that countries are increasingly attacking each other through financial means, such as controlling debt ownership, rather than traditional military conflict [2]. - The recent geopolitical tensions, particularly related to U.S. actions towards Greenland, have heightened fears among European investors regarding U.S. securities, potentially leading to a loss of crucial foreign funding for the U.S. [2][3]. - Dalio emphasizes that the current global environment is characterized by mutual fears and could easily escalate into a capital war [2]. Group 2: Economic Indicators and Market Reactions - Following the geopolitical tensions, markets have shifted into a "sell America" mode, negatively impacting the U.S. dollar and increasing yields on Treasury bonds, indicating concerns over rising government debt [4]. - Danish and Swedish pension funds have begun to exit U.S. Treasuries, citing unsustainable U.S. government finances as a primary reason for their divestment [4]. - The selloff in U.S. assets coincided with concerns over the independence of the Federal Reserve, further unsettling global investors [4]. Group 3: Broader Economic Context - Dalio highlights that the U.S. is at a critical juncture in a larger economic cycle, with its power diminishing due to a national debt of $38 trillion, compounded by geopolitical tensions and technological changes [3]. - He asserts that the existing monetary order is on the verge of breakdown, reflecting a significant shift in global economic dynamics [3].