Central Banks Shift Treasuries Holdings to Cash: MLIV

The video discusses how global central banks are heavily relying on their treasury holdings to acquire dollars needed to support their currencies. A significant drop in these holdings, especially from Asian countries like Japan and South Korea, is highlighted. South Korea's economic model is under stress due to rising energy costs and declining demand for exports like semiconductors. The video draws parallels between South Korea and Germany, both facing challenges due to their reliance on cheap energy imports. The ongoing global economic strains are exacerbated by factors like OPEC's supply cuts and the Fed's policies.

What significant financial action did Japan take in the FX market recently?

• Spent $20 billion in one day

• Increased treasury holdings by $20 billion

• Sold $20 billion worth of gold

• Reduced interest rates to zero

What is one of the main reasons for South Korea's current account deficit?

• Rising labor costs

• Decreased foreign investments

• Increased semiconductor demand

• High energy import costs

How much did the South Korean currency drop in September?

• 5%

• 7%

• 10%

• 12%

Which country is mentioned as having a similar economic model to South Korea?

• Japan

• Germany

• China

• United States

What external factor is likely to increase economic strain on countries like South Korea and Germany?

• Increase in global semiconductor demand

• Decrease in global labor force

• OPEC cutting oil supply

• OPEC increasing oil supply