China's hooked as much as we are

China can make all the noises it wants about replacing the dollar as the international reserve currency, but it's stuck on the dollar almost as much as we are. In order for China to sell off US treasuries, they need to find buyers. Given the large fraction of outstanding US securities held by China (about 24% of the value in January, measured in billions of $), they are going to have a hard time finding enough of them to absorb that amount. Further, if the markets even get a scent of a run in these securities, the value might plunge faster than China could sell them off.

China can, and has, sold off US treasures (and divested itself of the US dollar) slowly--but given how heavily invested it is (about a third of its foreign currency reserves are in US dollars, a wholesale switch to, for example, the Euro, would diminish the value of those reserves arguably faster than they could sell them off--if they could even find a buyer.