China's foreign exchange reserves-US dollars are not all our own. In addition to the dollars earned by domestic enterprises themselves, there are foreign companies' investments in China, or foreign exchange earned by export, as well as assistance from developed countries and loans from major financial institutions in the world, such as the World Bank; There are also some "hot money" that just want to earn profits in China in the short term. When they enter China, they will take US dollars to the bank and change them into RMB for domestic use. At the same time, they can change them into dollars at any time and propose to transfer them abroad. There are also domestic enterprises to buy technology, equipment and raw materials such as oil and ore abroad, which can be merged across borders. They all need to use the US dollar at any time, because the US dollar is the payment currency of the world. These foreign currencies must be preserved and increased in value, and they must be paid at any time. Investing in US Treasury bonds is the best channel. US Treasury bonds have the best liquidity and the most developed financial market. Both countries and financial institutions invest in US Treasury bonds. To put it bluntly, they can cash their US Treasury bonds in the market at any time for their own use, as well as interest income.

If the dollar is used for domestic people's livelihood, it will lead to inflation; Because these US dollar equivalent RMB have been released, if US dollars are released again, it will cause more and more money, which will lead to rising prices and asset bubbles, and then the savings deposits of ordinary people will shrink. This is a move that harms others and does not benefit others. At that time, there will be a situation like before liberation, holding a bundle of banknotes just to buy a box of matches.

It's too risky to buy stocks in dollar foreign exchange. When you go to buy bulk commodities, what China buys will go up, and the price will plummet after buying. If you buy the national debt of other countries, first, it has poor liquidity and low risk, and second, you may not be able to sell it after buying it.

Reducing the investment in U.S. Treasury bonds will narrow the investment channels of China's foreign exchange reserves, resulting in holding a large amount of cash, which cannot preserve and increase its value. At the same time, holding this cash has a cost, because we have to pay interest. At the same time, reducing the holdings of US Treasury bonds will inevitably tell the world that we look down on the US economy and government and sell US Treasury bonds, which will lead to a decline in the price of US Treasury bonds and shrink the unsold Treasury bonds in our hands; This will also hit the American economy and reduce imports from the United States. A large number of our foreign trade factories will close down and workers will lose their jobs. The closure of the factory will also reduce the use of raw materials such as coal, electricity, oil, metal and cement in the upstream, and trigger a chain reaction of China's economy. At present, the American economy has recovered, which is reflected in the increase of employment rate, which can best reflect the real situation. In the case of the worsening crisis in the euro zone, it can be seen that the US dollar is the most suitable investment.