The People’s Bank of China is the Chinese central bank and holds more financial assets than any other single public institution in the world. The State Administration for Foreign Exchange manages the foreign exchange reserves for the Chinese central bank, which exceeds $3 trillion. To put this into perspective the next in size to China is Japan, which manages foreign exchange reserves in excess of $1 trillion. The size of Chinese reserves is disclosed but the composition of the reserves is less transparent.
The composition of the Chinese foreign exchange reserves is regarded as a state secret. However, reports from the Bank for International Settlements suggest that United States assets represent 60-70 percent of the Chinese reserves. This lack of diversification has been costly to China as the U.S. dollar (Federal Reserve note) depreciates. As an example, between 2003 and 2004 the Chinese lost more than $60 billion in asset value due to dollar depreciation.
The private Federal Reserve controls the American money supply through lending to banks, individuals, and the government. The U.S. Treasury prints and sells bonds (loans with interest) known as T-bills to the general public, foreign countries, and back to the Federal Reserve. The private Federal Reserve creates electronic fiat currency from thin air to purchase the Treasury bonds and holds these bonds as reserves. For every dollar of reserves it creates another nine dollars for circulation in the nation’s banks to lend again to businesses and individuals. Thus, the money supply is constantly depreciated and the national debt is perpetually expanded – a scheme concocted by the banker cartel and sold to the American public as the natural business cycle.