MarketWatch.com is reporting that Japanese investors sold $13.8 billion worth of foreign bonds in the week of May 27 through April 2. This is the largest weekly net sales since mid November of the previous year.
Japan is the number two holder of U.S. Treasuries to the tune of $885.9 billion worth as of Jan, 2011. China is number one.
Some are voicing concerns over the possibility that Japan would begin selling significant amounts of U.S. Treasuries, spooking China into unloading their U.S. holdings. This could easily lead to a global sell-off which would likely be a worst-case scenario for a weakened the U.S. economy. Some are going so far as to say this could easily collapse the U.S. dollar completely.
