Bloomberg Opinion: Why doesn't China pull out its $760 billion in US Treasuries and crush the US all at once? Trump's tariff U-turn exposed his core weakness. Beijing could easily weaken the safe-haven status of the dollar. China no longer retaliates with equivalent tariffs against Trump's high tariffs, calling the actions of the Trump administration "ridiculous," and China no longer deems it worthwhile to retaliate. The question now is whether China will find a stronger weapon to counter its opponent. Beijing reiterated its vow to "fight to the end" on Friday. China has a dangerous card - its holdings of $760 billion in US Treasury bonds, making it the second-largest foreign creditor after Japan. Last week, the yield on 10-year Treasury bonds rose by 50 basis points to 4.49%, marking the largest weekly increase since 2001. Some of the most dramatic fluctuations occurred during the Asian trading session, sparking speculation about Beijing's involvement in the market. Will China weaponize its assets and sell them? Treasury Secretary Scott Bessent dismissed such concerns with disdain. In a recent interview with Tucker Carlson, he talked about the beauty of being the world's largest borrower. "If you borrow from a bank, the bank decides; they can reclaim anything you've put up as collateral. But if you owe enough, then you call the shots." he said. [star] Indeed, not bad for a US Treasury Secretary. Although what he said is true in some cases, it does not fully apply here. Trump's sudden 90-degree turn on tariffs exposed the fatal weakness of the White House – after witnessing the collapse of US sovereign bonds, he suspended interest rate hikes for all countries except China. After all, his cabinet now needs to spend money – his department needs to issue approximately $2 trillion in new debt this year, in addition to rolling over about $8 trillion in maturing bonds. For every one percentage point increase in yields, the government loses about $100 billion. But this weakness – the White House's desire to avoid a fiscal crisis – gives China an opportunity. Escalation of the tariff war? No problem. When Asia wakes up, selling some US Treasuries will put pressure on Trump. China doesn't even need to sell US bonds to continue the decline in US Treasury prices. The reason is simple – If Trump is determined to turn his country into an economic island through high tariff barriers, it is logical that foreign countries no longer need to hold so many dollars. [star] Oh, we see eye to eye. The dollar has already lost some of its dominance in international trade and finance. Setting aside trade tensions, due to the Fed's indecisive stance on interest rates, US Treasury bonds have not generated stable total returns in recent years. In other words, in this turbulent environment of anti-American and anti-bullying sentiment, China doesn't need much time to break the safe haven status of the dollar and bonds. Global investors are happy to look elsewhere. On X (formerly Twitter), billionaire hedge fund manager Bill Ackman praised the White House's tariff reversal, calling it "executed extremely well" and "textbook, the art of the deal." This guy is good at flattery, publicly comforting Trump's ego, but it's also hypocritical. Instead, Trump's chaotic decision-making exposed his core weakness. Now his own backyard is on fire. China will use its $760 billion to destroy the global status of US Treasuries. [Image: //p26-sign.toutiaoimg.com/tos-cn-i-ezhpy3drpa/1699c433def54eb3a27eb6c5f207e347~tplv-obj:1021:825.image?_iz=97245&bid=15&from=post&gid=1829384850780170&lk3s=06827d14&x-expires=1752364800&x-signature=otMPdWDjUmEzt6qadUESZ2z5n%2FY%3D] Original article: https://www.toutiao.com/article/1829384850780170/ Disclaimer: The article solely represents the author's personal views.