Posted on 05/16/2015 5:28:04 AM PDT by 9thLife
WASHINGTON (AP) -- Foreign holdings of U.S. debt rose in March as China ramped up its purchases and displaced Japan as the leading owner of U.S. Treasury securities.
The Treasury Department says overseas ownership of U.S. debt rose 2.1 percent in March to $6.18 trillion. That is below January's record of $6.22 trillion.
China added $37.3 billion ... bringing its stockpile to $1.26 trillion... ahead of Japan, which added just $2.5 billion...to $1.23 trillion.
...
The U.S. deficit topped $1 trillion from 2009 through 2012.
Foreign governments...account for two-thirds of the foreign holdings...rose 1 percent from the previous month to $4.13 trillion.
Saudi Arabia, Iraq, Algeria, Venezuela and Nigeria, added $500 million to bring their holdings to $297.3 billion...Caribbean banking centers...$10.9 billion, lifting their holdings to $293 billion.
Demand for U.S. Treasurys, widely considered one of the world's safest investments, is likely to remain strong. While U.S. interest rates are still low, they may climb later this year if the Federal Reserve begins to raise interest rates.
(Excerpt) Read more at hosted.ap.org ...
Master/Slave status is a function of the size of the loan.
If you owe the bank $10,000 then the bank owns you. If you owe the bank $10 million, then you own the bank.
Great. We’re still borrowing money from China to buy stuff made there. They get our money once when we buy their goods, and again when we pay the bonds back.
We are badly in debt as a country, because we have sent so many millions of formerly American jobs overseas.
China has benefited greatly from this, as they have now taken over the worldwide lead in exports. And that continues to grow rapidly.
Bring back jobs right here to America.
—Foreign governments...account for two-thirds of the foreign holdings—
Mmmm... all along (since the 90’s) people have been telling me our enormous debt is ‘okay’ because, well, “we owe it to ourselves!”
Not according to this article.
This is one of the curious consequences of a massive trade deficit between two countries. One country (China) may sell a lot of products to the other (USA), but we aren't bartering for those products. They get paid in U.S. dollars, and they can't eat them so they have to figure out what to do with them.
Another false argument. We sell treasuries to whoever will buy them in order to support the government's deficit spending - mostly spent on "entitlements", defense, and infra-structure here in the US. The fact that China buys US treasuries, has absolutely nothing to do with Chinese products being sold in Walmart and Target.
We have lost site of what it means to be free Americans and we have allowed our very own who have willingly been compromised to sell us all out
The connection is that much of the money the government gets from any kind of borrowing goes to entitlements. What do the entitled spend their money on? Products that are largely made in China.
As for the bonds, the interest is only part of the expected income. The face value over their initial cost is also part of the equation. Now I'm not sure of the type of bonds and treasuries we're selling to other nations, so maybe they are taking a loss by buying our debt. But I doubt it.
Like many markets these days, US debt is a greater fool market. In the case of our debt the greatest fool of all is the Fed, or more precisely, the American people who tolerate the Fed printing money to buy debt and the politicians who benefit from it. The simple reason that any foreigners would buy our debt right now, or at any moment in tine, is that they expect to resell it. Some greater fool will buy it from them.
The only other reason for buying US debt is the expectation that US income tax slaves will be able to pay it back. That is potentially a sign of economic recovery but that pales in comparison to the foolish recipe for economic failure promulgated by the Fed: funnel printed money into Keynesian spending and large banks to trickle down into the greater economy. They ignore the fact that undermining the currency penalizes long term investment and encourages speculation and bubbles.
Astonishing as it may seem, I believe there are more people living within 2,500 miles of Singapore than in the rest of the world combined. The U.S. is basically fading into history as the rest of the world catches up and surpasses us ... and it has nothing to do with our trade policy.
And you would have the government dictate where Americans spend their money -- for the common good, of course.
I looked into it somewhat in hope of finding out if the cost of the treasuries we're selling China and other countries is less than the face value. That is the nature of these types of investments, but to be honest, I couldn't confirm one way or another. If you have something showing the foreign countries are taking a loss on our debt, I'll thank you in advance for posting it.
Yes, but that 5% still packs a lot of purchasing power, even if it's now funded with printed QE3 dollars.
The U.S. is basically fading into history as the rest of the world catches up and surpasses us ... and it has nothing to do with our trade policy.
Oh but our trade policies do have something to do with it. We have replaced American tax payers that paid into our military and space program with foreign (Chinese) tax payers who are paying into their military and space program.
But that isn't the only factor. It's to the point where the takers are outvoting the producers, so we're getting leadership that is pandering to them. The 2014 midterms were a pleasant surprise, but unless the "free" money runs out, we'll get more of the same.
No, but I wouldn't want OUR representatives signing trade deals that have the effect of sending jobs held by our Veterans overseas either.
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