Swedish Alecta has sold off an estimated $8B of US Treasury Bonds (opens in new tab)

Bunch of dumb people running the room and no experts.

Today the yield is ~4.9.

Now, in 2026, how many institutions are "picking up pennies in front of steamrollers" ?

In a mark to market world, the value of a bond is its acquisition cost, so buying bonds enough to raise prices increases their value, but not their coupons or their face value. It's hard to make sense of the value of a sequence of payments, it's reasonable to consider the present value and the market price is an easily justified present value for a bond.

Selling bonds and buying stocks is a different thing altogether. Selling US stocks and buying EU stocks wouldn't change the value of the underlying assets, however, having an increased stock price does have benefits for the company when issuing new shares or bonds.

https://commission.europa.eu/strategy-and-policy/eu-budget/e...

In the meantime: German, Dutch, UK (technically not EU), Swiss, Nordic paper is also a good substitute and regardless all you really want to do here is not to hold an asset that may well become a liability so in that sense almost anything is better.

“I don’t need to outrun the bear. I just need to outrun you. “

https://www.bogleheads.org/forum/viewtopic.php?t=449401

There is nothing particularly interesting or sexy about US treasuries. You could replace a holding of $8bn to $80bn with equivalent or better rated bonds in a half hour or so.

Replacing that sort of allocation of stocks or commodities would be way harder as returns on those assets are not as simple as "pays a 4% coupon each year" - finding an equivalent of Apple or Nvidia is not a trivial task.

It seems to be precious metals. And at this point in time, especially silver. Even Indian government seems to be stockpiling silver.

If you're trying to escape an expected upcoming crash you don't necessarily need to look for growth but instead stability. Precious metals are always popular but simply shifting a portion of your money into an index fund of a different stock exchange should help minimize your exposure to any catastrophic loss.

This is, of course, not financial advice.

EU together with UK and Canada hold more Treasurys than the entire rest of the world combined, and if they dumped them all at once it would be significantly painful for the average American as interest rates would spike, as would inflation. The Dollar would decline against most other major currencies.

However dumping that much debt all at once would require the sellers to heavily discount a large portion of their bonds, earning them increasingly fewer, and paying in (depreciating) dollars.

It's exceedingly likely that de-dollarization accelerates from here, but it's also unlikely that even the Norwegian government sells it all at once. Rather than mass selling, expect EU entities to curtail or even cease buying US bonds altogether if the geopolitical situation doesn't improve.

As an interesting thought experiment, imagine a central bank associated with a debt-free country issuing bond-like instruments. They would set an interest rate (perhaps with no auction, because they have no actual obligation to sell a predetermined amount, although an auction could still be used), sell bonds, delete the money used to buy the bonds, and issue new money to repay them with interest when they mature. This could be used as a way to act efficiently as a reserve currency and to exert a degree of control over inflation and the economy, kind of like how the Fed does it. The bonds would likely be considered extremely secure on account of the issue being entirely debt-free.

I would be surprised if the EU did this as such, since the EU probably does not want to be in the business of competing for capital with its own members, who do have a fair amount of debt that they need to finance.

Additionally, French bonds, while likely less-correlated with US Treasuries than other instruments, suffer from its own government having high debt levels; it's not a suitable safe-haven asset. Swiss and German bonds appear to be obvious alternatives. However, Swiss and German bonds' interest rates are low and in practice are little different than holding cash.

While gold appreciated in the short term, it is not simply inversely correlated with the value of the US Dollar. Its volatility is also driven by investors mitigating strict currency controls, mining productivity, and central bank activity. An unrelated downturn in one market could lead to a sell-off and wipe out gains. Gold also has no yield. Personally I think it's useful only in its physical form as a hedge for medium-term catastrophic events. Even then, a stockpile of food and clean water is likely far more valuable, if not substantially more difficult to store and maintain.

I ended up giving up, learning to love the S&P 500, and white-knuckling it ahead. Of the investable markets, the US one still generates the highest returns. (Chinese GDP growth is higher but its equities have low returns compared with other markets, due to political risk.)

The european union's GDP is a solid 50% behind the US (20 trillion vs 30 trillion). But more alarmingly the growth in the european union since the 2008 financial crisis has been totally anaemic: the growth doesn't even counter inflation and that growth only came at the cost of gigantic additional public debt. Meanwhile both the US and China's GDPs grew like mad.

I also dispute the stability of the EU: in many countries the people aren't happy at all and the far-right are winning elections everywhere. And it's only through tactics (like the center-right siding with the ultra far left in France to counter the far-right party who won the election) that parties that aren't the far-right are managing to prevent the far-right from reigning already.

For example in the European Parliament 36% of the 720 seats are for far-right parties. And that's after all the other parties colluding (including with the far left) to prevent the far right from having more seats.

And as people are more and more dissatisfied with the current situation in the EU, the far-right keep winning more and more voters (sounds familiar?).

> The Euro very well become a reserve currency in a multipolar world if Europeans decide they want to shoulder it.

The Euro is only 27 years old, is a badly conceived currency and may turn out to be one of the shortest lived currency ever. There's no way it's ready to take on the role of the USD. France's finances, the eurozone's 2nd biggest economy, are crumbling (gigantic public debt and insane public deficit) and may very well be overtaken by the International Monetary Fund (like it happened to Greece) soon.

Germany is trying very hard to ban its far-right AFD party from the elections for they know they could very well win. If I'm not mistaken the leader of the AFD said if they won, they're out of the EU. Think it cannot happen? UK left the EU already.

It's not just the EURO that may be the shortest-lived currency ever: the EU is actually in trouble.

Then again, they say whatever they need to in order for their paychecks to keep coming.

If you're Honda, you'd prefer that the purchaser of any Honda is purchasing their Honda from Honda. Honda doesn't care about the secondary sale of any one Honda, per se, but they'd certainly care if people start opening dealerships with fleets of effectively brand new Hondas immediately next to every Honda dealership.

Additionally, every seller that was a previous long-term holder represents decreased demand for Treasuries at the primary auction. Mark Carney put it eloquently yesterday during his speech with his analogy of "taking the sign out of the window". This represents someone taking their bid out of the auction.

Sure, someone else is on the other side of the deal. But their demand is also satiated at a certain price point. Hell, if they wanted to buy from other sellers then it's not like T bills were not liquid.

Would you say the same if Norway's wealth fund offloaded their $181B? At those scales it would be more likely that it'd be visibly price affecting, and therefore affect the US's ability to borrow at existing cost.

So yes, when you sell your one NVDA, you are reducing demand and thus price. Epsilon, but nonzero.

Someone else considered it worthy of sharing here and enough people here found it interesting enough to get it to the front page. I don’t quite understand why, but it seems like it’s striking some sort of chord.

So everyone doesn't want to be last and the sell-off takes off fast and violently, forcing unmanageable interest rates.

similar with the US T-bonds - this pushes the yield up making it more expensive for the US to finance its debt (which already consumes nearly a fifth of the entire federal budget).

Or if we want to be cynical, they hope the price will drop on this news and they can buy back in more cheaply.

If someone thinks the value of those bonds is going to drop, then selling would have great significance for the seller.

Note that China has been selling US treasuries for months now (https://www.barrons.com/articles/china-sells-treasuries-9-st...) and there are signs that India has been quietly selling large amounts too. So it feels like the start of something much bigger, a total decoupling from the US due to its unstable politics, foreign policy, and quickly accumulating debt (Trump has added $5 trillion already and may add much more).