Replies

"This image that China or Japan could just call in their debt is scaremongering. First the bonds they buy are redeemable at a certain time. They are 30 year or 10 year notes. Second, it it not the governments but individuals in those countries who are investing here."

Exactly!!! Foreign national's investment in the U.S. is an indicator of the confidence others have in America. In overly regulated economies where societies and markets are less free than ours, foreign nationals are still able to vote with thier savings, and when they do this they are saying that the U.S. is the most reliable economy and has the most potential for growth. It is expected that the money be spent in a way that benefits the global economy. The post's concept is so asinine that, thus far I've been joking about it. But I think you're right, this might actually scare some Americans. You framed the reality very well, thanks!

No, no, no, you've got it all wrong. America would be in better econom ic shape if foreign investors considered US treasury bonds so risky that only Americans would dare invest in them. And it would be even better if Americans were net creditors because American investors put all their money into foreign bonds because they didn't want to allocate any of their own capital to their own country.

That would be perfect.