It seems like China’s top leaders knew less about China’s portfolio that American reserve watchers; it is not inconceivable (gulp) that I was the source for those published report about China’s Agency holdings.
Dr. Setser is referring to this Wall Street Journal article….
The alarm for Chinese leaders started ringing loudly in July and August as problems deepened at Fannie and Freddie. Senior Chinese leaders, who hadn’t been apprised in detail of how China’s reserves were being invested, learned for the first time in published reports that the country’s exposure to debt from those two alone totaled nearly $400 billion, say people familiar with the matter.
Fearing that the U.S. government might not fully back the companies, China demanded and received regular briefings throughout the peak of the crisis from high-level Treasury Department officials, including Mr. Paulson, on the market for U.S. debt securities — especially those of the mortgage giants.
It is not clear to me if this is the honest truth, or it is people who knew and are now trying to say that they did not know so as to deflect blame.
This entry was posted on Thursday, January 29th, 2009 at 8:06 pm and is filed under Front Page, Money. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.