Perhaps take this with several grains of salt:
Currently circulating the Interwebs is the note from Stratfor this morning that Zhou Xiaochuan, governor of China’s central bank, the People’s Bank of China, has fled the country, apparently because of a $430 billion loss on U.S. Treasuries suffered by the People’s Republic, according to Stratfor.
The matter is clouded by the fact that a report was published on Saturday attributed to Hong Kong-based news agency Min Pao and subsequently denied by Ming Pao. But the rumor has continued to circulate anyway. Stratfor says it can’t corroborate the matter but judges the spread of the rumor as “significant” given possible Communist Party leadership changes in 2012.
Tyler Durden at ZeroHedge adds the following post-scriptum about the rumored $430 billion loss:
Assuming average 6 Year duration on holdings (completely arbitrary), and a 2% drop in rates, means $430 billion is 12% of total notional, so somehow China must be short $3.5 trillion in notional or synthetically. Not good.
Update: In a brief this afternoon, Stratfor say they are unable to verify the rumor of Zhou’s departure, noting that some blogs in China claim the man has defected to the U.S.:
Read more at the link.