At present, the amount of American debt held by China ranks second in the world, and the largest is Japanese. The reason why we want to reduce our holdings of US debt is because the Federal Reserve kept raising interest rates some time ago, which led to the maximization of US debt income, which means that US debt income will go down for some time.
As the Fed continues to raise interest rates, countries that hold a large amount of US debt are facing greater risks, and selling is the wisest choice. Moreover, the United States used the dollar as a "weapon" to pursue hegemonism, and its credit gradually declined. Especially after the conflict between Russia and Ukraine, countries' interest in American debt also declined.
China reduced its holdings of 1000 billion US dollars in debt, which caught the United States off guard. The original plan of the Federal Reserve was to shrink its balance sheet in June, sell the national debt, and then let those countries with strong dollar reserves take over. China had already sold $654.38+000 billion before, but it didn't fall into the trap of the United States, and the Japanese also sold it. 11600 million dollars.
Today, the United States is facing serious inflation. In June, the inflation rate in the United States reached 9. 1%, the highest point in 40 years, which had a lot to do with Biden's failed policy. Now, for China, it is the best way to fight inflation to exchange US dollars for real things and use a lot of US dollars to buy things. For example, China Airlines bought a plane worth $37.2 billion from French Airbus, and the settlement currency was US dollars.
While selling US debt, China should continue to promote the internationalization of the RMB, which is the best response to the US's unwarranted suppression of China; Recently, Pelosi's visit to Taiwan Province Province caused an uproar. On the same day, China immediately issued a severe warning to the United States, forbidding Pelosi to visit Taiwan Province Province, otherwise all consequences will be at your own risk.
However, Biden also responded to this matter today, saying that the US military is worried about Pelosi's "visit to Taiwan plan" and thinks that it is not a good idea now; Obviously, the United States is cutting sausages, testing China's bottom line bit by bit, and watching China's reaction to Pelosi's visit to Taiwan is also sending a wrong signal to the island. However, China has announced that it will bear all the consequences, and the significance of this sentence is self-evident.
Biden knows very well that this topic can be constantly hyped because of Pelosi's special status. The US military only said that it was not a "good idea" at present, and the implication should be to let Pelosi wait for the opportunity. Whether or not to visit Taiwan depends on the situation. The Biden administration can always use this matter as a bargaining chip with China.
In fact, Biden only chose to talk to China because of various domestic pressures. This time, he should focus on discussing with China the cancellation of tariffs on China. After all, the inflationary pressure in the United States remains high, while Biden's support rate has plummeted, only 33%, which is getting closer and closer to the mid-term election. If Biden doesn't act, the Democratic Party will lose the mid-term election, which Biden doesn't want to see.
Although the United States hopes to get something from China, its recent actions are challenging China's bottom line, such as approving arms sales to Taiwan and sending politicians to visit Taiwan Province Province, which are serious violations of the "one China principle". Since you want to ease the relationship, you must show sincerity. As a typical example of "face to face, behind the back", what the US needs to do most is to let China see the actual actions of the US, rather than staying in "verbal statements", otherwise it will be useless to say more.