China is both a major trading partner of the United States and the largest official holder of U.S. assets in the world … article explains the reasons for this large decline in official assets, what China's policy choices are, and how these choices …

China are not necessarily the intended out- come of any government policies or an undervalued home currency, but instead a … timely financial reform). A tractable growth model of precautionary saving is provided to quantitatively explain China …

China s foreign asset positions because capital cannot ow out of China under capital controls. A related but deeper puzzle … that this literature fails to address is China s high saving rate despite an astonishingly rapid income growth rate. This … paper argues that understanding China s massive foreign reserves must start with a basic trade model (e.g., Melitz, 2003) in …