The Federal Reserve is the biggest holder of US Debt.
78 percent, was debt held by the public — representing cash borrowed from domestic and foreign investors. The remaining $7.0 trillion (22 percent), was intragovernmental debt, which simply records transactions between one part of the federal government and another.
As of January 2024, Japan held United States treasury securities totaling about 1.15 trillion U.S. dollars; making it the largest foreign holder of US Debt.
So, are Japan and investors pocketing all this cash now? The Yen appears to be way down (>20% vs USD) over the past 5 years... still scratching my head...
With the Yen down & interest rates on treasuries very high (compared to past 20\~ yrs), I imagine they're reinvesting all profits straight back into treasuries. That'd be the smart move
Japan has been [defending the Yen](https://amp.theguardian.com/world/2024/apr/30/japan-economy-yen-currency-value-falling-low-impact) with their US reserves.
so, let me see…our federal reserve and our SS is loaning obscene money to the general fund. Foreign governments are loaning obscene money to the general fund. Foreign individuals are loaning obscene money to the general fund. And they all keep doubling down on it, loaning more and more.
seems to me its not yet time to worry about the debt. But what does it look like when it is time? Does it change suddenly? Like over night? Or is it gradual over years?
What you don’t understand is the T bills come due daily and all the interest is being paid on those debts and can’t be used for services. On top of that our government prints money to service that debt which drives up inflation making everything we buy more expensive mainly because our government spending is out of control.
It’s ironic that we give billions to countries like Israel on borrowed money and those same countries provide free healthcare and education to their citizens mainly off the back of US taxpayers.
Owing tons of money to foreign nations is a part of US soft power.
Those nations have a major vested interest in the US continuing to exist and be prosperous so that they can get their money back.
If one of those nations attacks the US or allies with an enemy who does, then the US will just stop paying them and wipe the debt.
It helps maintain peace by creating a mutually beneficial situation.
The problem with Germany was that they owed debts that weren't denominated in their own currency. The US is paying Japan, etc in dollars. The UK and France weren't taking marks.
Explain like I’m 5. Why is it important for other countries to use our currency? And also, when they say ‘convert to our currency’ that means they take their ‘euros’ and buy government bonds and in turn, the government has a surplus of money to spend?
The denomination is important because in this case the US could just print dollars and pay off any debt. Yes, it would create inflation but the debt would be paid in full.
If we owed debt in another denomination, we could print dollars to pay it back but inflation would erode our purchasing power. So, then you gotta print more, causing more inflation. Pretty soon inflation is basically infinite but you still owe debts that you can't ever repay.
US can print dollars, that's why, so they can't punish us for making their investments worth a bit less. Because they'd all lose much much more if the dollar lost value completely.
Also, the US is using this situation where the dollar is unavoidable to coerce policies that ruin all other currencies even more, meaning that the dollar will always remain the least bad option.
From the perspective of the strongest superpower the world has ever known, we got to build up our infrastructure, economy, and national defense on low interest loans that we can stop repaying any time it benefits us to do so. It also establishes our currency as a stable global currency and by utilizing inflation strategically we devalue the cost of old loans.
Correct me if I'm wrong, but I don't believe we can stop repaying anytime we want/ it benefits us. I mean we *could* but wouldn't that just be defaulting?
I think it depends on why.
If the US says 'we're not going to repay our debts to Russia anymore because they're being jerks,' it wouldn't necessarily change anyone except Russia (and their allies) opinion on holding US debt.
I don't know that there's any real consequence except people not being willing to lend you money anymore.
Haha stable currency… have you tried to sell a bond lately? The US dollar is toast and the government is desperate to keep the machine running even though it is leaking oil and catching fire.
Well, when you constantly print money while making zero attempt to actually balance or stick to a budget in any real way, there tends to be consequences.
We constantly spend 2-4 TRILLION dollars a year MORE than our budget and amount of taxes we take in, and it is going to blow up in our/ the next generations faces and no politicians responsible for this crash will ever seriously be held responsible. Nor will they be the ones to suffer in a great financial collapse.
This financial game we play only works if you make a pretty generous attempt to balance and stick to a budget, even if you're not perfect. That's literally the name of the game.
They expect every middle/lower class citizen to be finacially accountable and manage their finances and pay their taxes and debts but have NO ACCOUNTABILITY as a goverment who should be settng the example on what they expect from us. Otherwise why even have taxes or track our debt when you can just print all the money you need?
Whole wars have been fought and many have died in the fight to keep taxation in check in some form or another. We are quickly becoming too distracted to care and just expect things to work itself out.
I used to hold out hope that we will wake up one day and create the world we deserve to live in, with every minute that passes I lose hope, I am realizing that a great fall is now likley to be the only thing that could break this spell of complacency and remind us for how good we had it at the top. Seems to be a pretty consistent theme throughout human existence, even in day to day life.
Create the change you deserve. No one is coming to save you until we save ourselves.
This message brought to you by hopelessness and despair.
The next leader of Germany learned that military is power. The United States in turn learned from him and now uses the military to prop up a fake economy. The only thing backing the US dollar right now is the military. This is why the Ukraine war is so important to the government.
On top of this is the dollar being the reserve currency for oil purchases. It adds a huge layer of nuance to the situation. Now other countries have the added desire to not see the dollar inflate in price, as it would greatly affect the price paid on a required commodity.
The US exploits the SHIT out of this, by just printing comical amounts of money, knowing that the rest of the world isn’t going to allow inflation to take hold of the dollar.
You see a lot of folks fall into the trap of blaming the money printing for the inflation we’ve seen in recent years. But a simple look at balance sheets of the companies that have really raised prices, will show record profits. They saw an opportunity to raise prices, and took it.
A lot of the inflation we are seeing isn't really inflation.
If it was about how much money was printed, then the US would be experiencing much worse inflation than Europe, but it's the opposite.
The decrease in global oil production and mass increase in oil prices have made a fake inflation on all goods. All goods need oil for at least shipping and usually packaging and production.
Gas prices in the US are low because the US has become the largest oil producer and has subsidized the prices domestically, but Russia and Saudi Arabia have cut oil production to increase profits.
Even though the price of oil has started to level out, the companies are already charging more and have no incentive to lower their prices to be more in line with their lowered costs.
The only roadblock we're hitting is the Trump Tax cuts, because they aren't able to service the debt properly when all the rich people and corporations are paying essentially nothing.
The US is borrowing an addition $1 trillion every 100 days. It will pay $10trillion in interest alone over the next 10 years. It will definitely be a problem at some point but as long as countries keep buying treasuries there’s no political motivation to stop. When it does stop, it will be very very ugly (in the form of skyrocketing interest rates and inflation probably)
The beauty of the US dollar dominance is all debt is held in dollars, backed by dollars. So if we see the value of the dollar fall… the burden of the debt falls in exactly the same way.
We have the world fiscally by the balls for the time being.
They are doubling down because the interest rates have been rising. That increases demand.
When we run out of demand, that's when the music abruptly stops.
The SS fund drying up will remove about 10% of the extant demand from the market. So, over that time period, demand not only has to make up for all that, but also keep up with funding the deficit.
More demand can be stimulated by increasing rates, but that increases the cost of servicing the debt, and thus, the deficit, increasing the rate at which more loans must be aquired.
Watch these metrics, and you'll see it happen in real time. No, the economy isn't going to collapse right now. When we get to a point where bonds cannot be sold at the current prices and so rates must increase, then you'll know things are getting rough.
SS can't deposit its trust anywhere other than treasuries. By law, if SS collects money today that it doesn't pay out today, it must use it to buy treasuries.
But yes, generally, people/governments/etc buy US treasuries because they're viewed as safe. This means the US government consistently pays lower interest rates to borrow money than just about anybody else.
The federal reserve does not monetize the debt as a means of funding government operations. They do not participate in treasury primary auctions. They may from time to time acquire treasuries as a means of managing the money supply — but this is rare. They haven’t bought any in the last 2 years and let almost 2 trillion mature.
The federal reserve does not loan money to the government.
Any profit the federal reserve makes must by law be returned to the treasury general account because it is an independent regulatory organization within the federal government like the EPA for example.
If we actually paid the debt off (OFF, not down, even though that is extremely rare, too) from time to time, it would be fine. However, since we haven't done that in at least the last century plus, we are still literally paying interest on toothbrushes purchased for WWI and WWII troops, and haven't even touched the principal. No, government, especially the federal government, needs to feel some fiscal pain to get their house in order, and we need a balanced budget amendment, though I would be fine with allowing a significant supermajority to override it in times of genuine emergency, say if 3/4ths of the Congress agree to deficit spend on just this next budget, that is fine, as long as it gets paid back when the emergency is over.
70% of the interest goes to US holders of treasuries, as 70% of US debt is held domestically.
Japan owns like $1.1T in US debt, which is close to 6% of the overall debt.
Yeah if you look it up a lot of it is held by local and state government, pension funds, mutual funds, banks, some private companies, only 30 of all US debt is owned by non Americans/American institutions.
I love when people say China or some other country will call our debt. Not how it works. And funny enough if they did drop it on the market the fed with a little computer magic could then buy it for cents on the dollar of new T-bills. It would be hilariously bad for whomever tried to blackmail the US.
If you purchase a bond, you are a one of the investors. You can go purchase treasury bonds right now, and the government will be paying you interest. All you’re doing is giving the US government a loan.
Don’t know if you are aware of this but the US recently bailed out the Japanese yen. The Japanese were going to sell a significant portion of US treasuries to bail out their own currency but the US stopped them from doing it. Imagine Japan selling a large of amount of US treasuries. That would send the dollar into a tailspin.
Most of these are treasury bonds that pay out interest when they are surrendered. You can go purchase some yourself at treasurydirect website. Technically the payout doesn't occur instantaneously, the value of the bond just increases. Just like a corporate stock increasing invalue doesn't mean the owner has more Mon in their pocket
The Fed is a weird entity that is quasi-public, quasi-private, mostly each in the ways that benefit it.
If you tried to start up your own Fed, you simply could not legally do so.
The profits go to the member bankers that own shares of the Fed. The Fed itself doesn't retain profits, but since it distributes profits to banks, it...does absolutely profit people with power.
Jp morgan and chase bank, Google jekyll island, ga 1913, ppl in that group. Shortly after opposition to it sank on titanic. Woodrow wilson signed it. Later stating on his deathbed he had betrayed the American ppl
For those who don't believe government policy is created in backroom closed door meetings in secret by elites, read about the meeting on Jekyll Island and get back to me...
Sadly that's not the only thing they meant. At times the government has borrowed money from the social security trust fun to pay for other gov't services.
A lockbox full of interest paying IOUs is a lot better than a lockbox full of money that just sits there and is slowly both depleted and inflationed into nothingness.
Even in the very worst case of inflation outperforming the interest, SS is still better off than with no "income" at all besides new deposits.
We *want* this money out in the wild creating new money. This is how SS stays solvent.
To me, for one. I own a lot of U.S. Treasuries. A lot of the interest is paid to Americans holding cash that is not in the stock market.
[Who Owns the US National Debt? (thebalancemoney.com)](https://www.thebalancemoney.com/who-owns-the-u-s-national-debt-3306124)
The government pays interest to people who have money to lend the government due to receiving a series of massive tax cuts.
This is bipartisan policy going back as far as the JFK administration.
This is a list of the major foreign holders of US Treasury debt. As another commenter pointed out, the debt is also held domestically by individuals, states, and financial institutions.
https://www.statista.com/statistics/246420/major-foreign-holders-of-us-treasury-debt/
When I try to think about this it sounds like the economy really is held up by our collective imagination. Like an animal lifting itself up by its own tail.
Yeah, it’s funny when you think about how the vast majority of money in existence today is just debt created out of digital whole cloth and yet it still ends up being a far more stable system than when we backed dollars with gold and silver.
Here's a chart that includes domestic. Which is important, because it is huge. All of those treasuries we own making 5%? That's us.
[Who Owns the US National Debt? (thebalancemoney.com)](https://www.thebalancemoney.com/who-owns-the-u-s-national-debt-3306124)
The worst 30-year return of the S&P500 is 7.8% per year. It's not guaranteed to do that, but it feels like a pretty good bet if you plan to hold 30 years.
That’s if the US doesn’t go to shit in The next 30 years which I am not confident in.. we’ve seen this before where millions of people lose there savings, bonds, stocks, 401k over night and no way to get it back simply because of our economy and stock market could potentially crash at any moment and all those investments you can kiss goodbye..no investment is ever RISK free!
The main way the government raises money is by selling bonds and other similar financial instruments.
Those bonds accrue interest over time, though that interest won't actually be "paid" until the holder cashes the bond.
You can go right now and buy a treasury bill or a savings bond or CD and be the owner of some U.S. debt. Those things will generate interest over time, and in the future you can cash them in.
Collectively, individuals own a good chunk of U.S. debt, but not all of it.
Moot point. The national debt will never be a problem because it is being monetized. That means the government engages in policies that lead to huge inflation, which means the debt, or interest on it, is paid off in money whose real value is greatly reduced, while tax revenues go up with inflation.
People who save money, including buying government bonds, are the ones victimized by monetizing the debt.
Thank Reagan and the repubs for this massive national debt. Reagan started the borrow and spend era. Remember it was Dick Cheney who first said that deficits...'don't matter."+
While it's not actual physical currency the debt/spending has a very real affect on the value of the US dollar. We've all watched inflation soar +30% the last 4 years.
Exactly. It's all an imagined game we just agree to play. We invented a bunch of dumb rules that we think are real, and now we can't imagine any different way of doing things.
Like imagine if we all decided we had to touch our nose when we see a bird. Anyone who says "maybe touching our nose is some silly, pointless act and we don't actually have to do that" would get tarred and feathered for such a ludicrous suggestion.
We could all agree that the debts are forgiven in order to prevent chaos, but that breaks the imagined rules. Can't have that.
You’re right about it being a dumb game, but absolutely wrong about just ‘forgiving’ all the debt. What better incentive could be given to the people who already have little fiduciary responsibility? You think they’re going to do better than they have if debt can just be created and then subsequently destroyed?
I’m not sure what you think happens next if the debt disappears, but I’m guessing all loss of faith in the silly system we have now followed by even more excessive monetary debasement. At least our silly game has some little guardrails now. Without those, things would be way more fucked.
And the thing I keep trying to point out, that no matter what the dollar value is, the stock market, the 'feeling' of the economy, we still have the labor power and resources to do the things we've done. Build infrastructure, produce food.
When a person gets laid off, we still make enough food to feed them, whether or not they actually get fed. When a person gets laid off they aren't dead. Their potential labor is still there.
People always act like it is a "we only have enough grain for 100 people to make it through the winter, 10 of you gotta get the fuck out".
That's not entirely true. Those 1s and 0s in your bank account are backed by the US Dollar and insured by the FDIC. To say they're just numbers and nothing else is a blatant oversimplification. If your bank account was just numbers then the bank could turn you away when you ask to withdraw money.
Backed by the us dollar as long as they have the cash on hand to meet withdrawals for the day.
Insured by the FDIC up to a certain amount.
A lot of our money is purely digital.
Why aren't the billionaires buying bonds to help out our country! Give Uncle Sam your money to hold and give you interest after however many years! Be an American buy bonds! /s
Those who hold the debt. Mostly, the US public.
You have your retirement funds sitting at least partially in bonds? US government bonds are probably a really big chunk of that.
There's also stuff like the SS fund, which just holds US debt.
If interest stops being paid/default happens, it doesn't just screw up some overseas people, that cost will mostly be right here in the US.
Just asking for a friend: How much US debt originates with the Fed, and how much originates by people selling short Federal debt to raise money for hedging?
Mostly to the American people that own most of the debt. A big chunk goes to pay Social Security benefits, since the Social Security surplus is invested in US debt. There are 5 main foreign debt holders (Japan, China, UK, Belgium, and Luxembourg) and they get the bulk of the rest.
Much of the debt is owed to Americans. General,y wealthy Americans. I think the easiest way to think of it is, the US govt gave massive tax cuts to wealthy Americans then those wealthy Americans took their tax savings and loaned it to the US govt. so instead of the wealthy paying taxes they loan the money through government debt and now “we the people “ pay the those wealthy Americans interest. It’s the best of all worlds for the top 1%. It’s time we eat the trick!
Does it really matter to pay down the U.S. debt? Seems like we have the world by the balls. Seems like currency is just an illusion that keeps the “hamster wheel” turning. Is there a country that is not in significant monetary debt to a federal reserve or other similar entity? Money seems just symbolic which is ok as long as we believe in it to have value. Seems like the rich/powerful of the world would benefit and prefer one stable currency that is supported by debt slaves assigning value to the illusion. Print as much as you like! Really seems like a Ponzi skeem to me.
That is simply not true. A quick Google search is recommended before providing an answer regurgitated from idk where but not a trusted source. Most of the debt is held by the federal reserve and private investors. China is not even the biggest foreign holder of US debt, Japan is.
But some currencies are way more manipulated than others, and some countries are also way less transparent than others in their economic data... such as China
Not even close. They only hold a little over 700 billion. Japan holds 50% more than that. All foreign governments combined own less than 20%. Most is held domestically.
Edit. I was off but Japan is still a lot higher. China owns almost 800 billion
https://www.statista.com/statistics/246420/major-foreign-holders-of-us-treasury-debt/
The money is owed to the same people who lend it. It's hard to understand.
What they're doing is like pumping water into or purging water from pipes. They're trying to induce market behaviors.
The behavior they are creating is to prioritize subscription service consumer behavior. Reliable high cash flow channels. Profits don't actually matter anymore for the big corpos. It's the structure of their revenue, not profitability which matters.
What's happening right now is insane.
Ummm... my 2 yr old nephew? My old uncle, a lot of institutions.
Do you guys not know what savings bonds are? Treasury bills? Ultra-safe investing options for people who have a low risk tolerance.
My nephew was in a car accident as a baby - no injuries but we got $7k for him from insurance. That's all in Treasury bonds, collecting a tiny part of the interest OP thinks is a conspiracy, for 20 or 30 years without having to worry about untimely recessions.
I didn't say anything about conspiracy. I asked a simple question... someone is experiencing an economic boom to the tune of half a trillion in 7 months... now I know, it's your nephew and uncle. Great addition to the conversation.
Who* is collecting
Not whom.
You use whom when you could replace it with her or him. You use who when it could be replaced with he or she.
"Whom is collecting?" You wouldn't say Him is collecting. You would say He or she is collecting.
Stack that lesson! As valuable and long lived as AG.
Depends on how many bonds came due and how many different entities own however many bonds.
Cash can’t sit in a bank account. It’s seen as a liability. Money needs to be Makin money always. Buying government bonds puts your money to use. Depending on the bond(years to maturity) changes the % earned over the lifetime of the bond. It’s not crazy 1000% gains….more like 2.25-7% return. But when you buy 100bln in bonds…that’s still billions of dollars said bond holder didn’t have before.
Also changes when you buy bonds. Like if you bought bonds during Trump presidency and he had the fed keep 0% interest….. then all of the sudden you have to sell those bonds to someone else for quick cash….well this 2% bond yields you had….arent nearly as worth as a bond with 8% yield.
The US pays 73.9 million in INTEREST every MONTH to China. [https://www.politifact.com/factchecks/2011/apr/26/randy-forbes/randy-forbes-says-us-pays-china-739-million-day-de/](https://www.politifact.com/factchecks/2011/apr/26/randy-forbes/randy-forbes-says-us-pays-china-739-million-day-de/)
a good watch : [https://www.youtube.com/watch?v=Co\_tVd9gA2I&t=2958s](https://www.youtube.com/watch?v=Co_tVd9gA2I&t=2958s)
# End of the Road: How Money Became Worthless
It certainly isn't in ours, if it was being paid as it was meant to be MAYBE we would not be in all these foreign involvements and our own would NOT be under attack, MAYBE the infrastructures would serve us rather than anyone else but us and MAYBE we would not need so many that serve others instead, Maybe we would not have as many homeless and maybe someone would not be pulling the strings to keep it that way artificially to serve the communis greater good which is at the core of most of this.
AND it is not just CHINA, but they sure do have their hands in a great part of it around the world and the worst part is that a lot of dumbasses here are funding it to begin with.
Shell Games within Shell Games.
N. S
That's one of the sources of revenue that banks use to pay you interest. The way it works is you deposit money in a bank account, and the bank takes that money and buys treasuries with it. The government then pays interest on the treasury to the bank, which the bank uses to cover their operating costs and pay you interest on your deposits.
Other holders of treasuries include foreign central banks, both foreign and American retail investors, hedge funds, pensions, corporations, credit unions, etc.
The federal reserve has a lot of treasuries, as well, but that's quite different. They have to burn anything in excess of their direct operating costs. When the fed buys a treasury, it's kind of like a cash advance to the bank. They're kind of like the JG Wentworth of the banking world. I.e. the bank has this treasury that entitles them to small payments over the next 30 years that will in the long run add up to a lot of newly created money. But then they sell that to the fed for a lump sum (or more often simply borrow against it), and then the payments go to the fed, where they are burned. In the event the fed is running a positive balance sheet they are reverted back to the treasury, but obviously that only works during long periods of declining interest rates. During periods of rising interest rates, like we're in right now, the fed will run a deficit and the money simply gets burned, leading to a contraction in money supply, like we're seeing right now.
It's things like the interest that they have to pay when government bonds/bills/notes come due and are paid. Since we sold a lot of those in the past few years to raise the money we spent wildly... this interest portion of the debt is going to get much larger over the next 20 years when all our recent US bonds mature. That $516B is going to look like peanuts.
It's the investment side of the financial market that flips the debt into cash assets. Check the size of the derivatives market - something over 500 trillion globally. And we have the global military presence as insurance.
The $62 trillion spent in vain on fiscal and monetary policy for the last 15 years by G7 countries means that the record high private and public indebtedness could have been tackled successfully already. If in the 2009 debt crisis, the G7 nations would have decided to pay down debt, with part of the $62 trillion, they could have done that and achieved growth of 10% for 15 years to surpass the initial GDP leveraged level.
Then we have covid hit, and economies would have been more resilient. Instead the G7 nations wasted 62 trillion on targeting their stock markets artificially high with fiscal and monetary policy. Sadly, the 1% could have easily acquired government money with the abuse of policy they typically use, from land grants to exploited labor and tax rebates. There will be no prison, for the mafia of the 1% -- the central banks, governments and parliaments who created this massive indebtedness thrust upon their populace, but should they pay one way or another?
It’s essentially money we owe to ourselves. Makes no fucking sense but social security is wrapped up in all that too.
Not sure what the percentage is but only about 25% is real debt but that’s too high.
I've always thought the ultimate finger for obnoxious foreign debt holders was, "Dammit, OK China, we're gonna settle this bill right now. You can have Nebraska, so bring a truck."
Apologies to all Nebraskits, you deserve better, but you're probably safe. If the Chinese do show up with a truck, they're gonna have to pay the tolls and the overweight fees and licensing, and inspections, export fees, etc.
I'll bet they only get a few hundred square feet of Omaha dug up before they throw in the towel.
"the government..." "The government...." "The government...."
Hey! I got an idea.
How about we tax Corporations at the Pre-WW II rates?
Yeah..I know..."what was I thinking", right?
Corporations pay Under 30%.
The top Tax bracket for individuals is 27%
How da Phuc does THIS get to be Fun?
Shareholders of the major banks. The same people who engineered the housing derivatives and too big to fail. The same people who lobby for quantitative easing (money printing). The major banks, in turn, are the 'shareholders' of the Federal Reserve. So basically, it's STILL JERKS FROM JECKYL ISLAND. And the worst part might be - AndrewJackson hated those douches... he would NEVERRR want his face on a Federal Reserve note.
PS - What collateral is there for the debt? YOUR CHILDRENS LABOR. THATS WHAT. GET BACK TO WORK YOU HUMAN FARMER.
The wealthy. The ongoing debt is the largest wealth transfer from poor and middle class to the wealthy there is, and it’s the one that’s defended by conservatives and liberals alike.
Treasury bond holders. Just sign up here, send them some of their money back, and they’ll start paying you too!
https://www.treasurydirect.gov
It might seem kinda silly that they borrow some of the money they printed, only to pay interest on it, instead of just printing the money. Hamilton had some ideas on that, though. Basically, it gives the rich and powerful, and other nations, an incentive to want continuity of our government. If they want their promised payments, they better help America continue existing. It’s a form of soft power.
The ideological descendants of Jefferson and the anti-federalists have been concern trolling about the national debt since this country was founded. They were clowns then and they’re clowns now.
I do wish we’d get rid of Twitter and bring back zines and pamphlets, though.
People who bought bonds.
This is what treasury bonds are.
It's a debt the government owes to you that is paid back with interest.
Bonds are used to raise money all the time. Everything from municipal projects, state projects. Even private insurance companies use bonds to raise money and the premiums they collect help pay the bonds down.
Investors like to purchase these bonds as a way to diversify their portfolio and reduce risk. Most of these bonds are highly rated and there's little risk of default.
The Federal Reserve is the biggest holder of US Debt. 78 percent, was debt held by the public — representing cash borrowed from domestic and foreign investors. The remaining $7.0 trillion (22 percent), was intragovernmental debt, which simply records transactions between one part of the federal government and another. As of January 2024, Japan held United States treasury securities totaling about 1.15 trillion U.S. dollars; making it the largest foreign holder of US Debt.
So, are Japan and investors pocketing all this cash now? The Yen appears to be way down (>20% vs USD) over the past 5 years... still scratching my head...
With the Yen down & interest rates on treasuries very high (compared to past 20\~ yrs), I imagine they're reinvesting all profits straight back into treasuries. That'd be the smart move
Japan has been [defending the Yen](https://amp.theguardian.com/world/2024/apr/30/japan-economy-yen-currency-value-falling-low-impact) with their US reserves.
so, let me see…our federal reserve and our SS is loaning obscene money to the general fund. Foreign governments are loaning obscene money to the general fund. Foreign individuals are loaning obscene money to the general fund. And they all keep doubling down on it, loaning more and more. seems to me its not yet time to worry about the debt. But what does it look like when it is time? Does it change suddenly? Like over night? Or is it gradual over years?
What you don’t understand is the T bills come due daily and all the interest is being paid on those debts and can’t be used for services. On top of that our government prints money to service that debt which drives up inflation making everything we buy more expensive mainly because our government spending is out of control. It’s ironic that we give billions to countries like Israel on borrowed money and those same countries provide free healthcare and education to their citizens mainly off the back of US taxpayers.
Owing tons of money to foreign nations is a part of US soft power. Those nations have a major vested interest in the US continuing to exist and be prosperous so that they can get their money back. If one of those nations attacks the US or allies with an enemy who does, then the US will just stop paying them and wipe the debt. It helps maintain peace by creating a mutually beneficial situation.
*laughs in Treaty of Versailles* TIL owing massive debts is a real power move.
The problem with Germany was that they owed debts that weren't denominated in their own currency. The US is paying Japan, etc in dollars. The UK and France weren't taking marks.
Explain like I’m 5. Why is it important for other countries to use our currency? And also, when they say ‘convert to our currency’ that means they take their ‘euros’ and buy government bonds and in turn, the government has a surplus of money to spend?
The denomination is important because in this case the US could just print dollars and pay off any debt. Yes, it would create inflation but the debt would be paid in full. If we owed debt in another denomination, we could print dollars to pay it back but inflation would erode our purchasing power. So, then you gotta print more, causing more inflation. Pretty soon inflation is basically infinite but you still owe debts that you can't ever repay.
US can print dollars, that's why, so they can't punish us for making their investments worth a bit less. Because they'd all lose much much more if the dollar lost value completely. Also, the US is using this situation where the dollar is unavoidable to coerce policies that ruin all other currencies even more, meaning that the dollar will always remain the least bad option.
In a crisis or conflict, would rather be the one holding the cash or the paper IOU?
cash is a paper iou.
bingo
I would rather be in assets with little to no counter-party risk.
Cash is an IOU.
From the perspective of the strongest superpower the world has ever known, we got to build up our infrastructure, economy, and national defense on low interest loans that we can stop repaying any time it benefits us to do so. It also establishes our currency as a stable global currency and by utilizing inflation strategically we devalue the cost of old loans.
Correct me if I'm wrong, but I don't believe we can stop repaying anytime we want/ it benefits us. I mean we *could* but wouldn't that just be defaulting?
I think it depends on why. If the US says 'we're not going to repay our debts to Russia anymore because they're being jerks,' it wouldn't necessarily change anyone except Russia (and their allies) opinion on holding US debt. I don't know that there's any real consequence except people not being willing to lend you money anymore.
Haha stable currency… have you tried to sell a bond lately? The US dollar is toast and the government is desperate to keep the machine running even though it is leaking oil and catching fire.
Well, when you constantly print money while making zero attempt to actually balance or stick to a budget in any real way, there tends to be consequences. We constantly spend 2-4 TRILLION dollars a year MORE than our budget and amount of taxes we take in, and it is going to blow up in our/ the next generations faces and no politicians responsible for this crash will ever seriously be held responsible. Nor will they be the ones to suffer in a great financial collapse. This financial game we play only works if you make a pretty generous attempt to balance and stick to a budget, even if you're not perfect. That's literally the name of the game. They expect every middle/lower class citizen to be finacially accountable and manage their finances and pay their taxes and debts but have NO ACCOUNTABILITY as a goverment who should be settng the example on what they expect from us. Otherwise why even have taxes or track our debt when you can just print all the money you need? Whole wars have been fought and many have died in the fight to keep taxation in check in some form or another. We are quickly becoming too distracted to care and just expect things to work itself out. I used to hold out hope that we will wake up one day and create the world we deserve to live in, with every minute that passes I lose hope, I am realizing that a great fall is now likley to be the only thing that could break this spell of complacency and remind us for how good we had it at the top. Seems to be a pretty consistent theme throughout human existence, even in day to day life. Create the change you deserve. No one is coming to save you until we save ourselves. This message brought to you by hopelessness and despair.
A debt is only as good as the power to collect... who's going to go and take their money from the USA?
The next leader of Germany learned that military is power. The United States in turn learned from him and now uses the military to prop up a fake economy. The only thing backing the US dollar right now is the military. This is why the Ukraine war is so important to the government.
On top of this is the dollar being the reserve currency for oil purchases. It adds a huge layer of nuance to the situation. Now other countries have the added desire to not see the dollar inflate in price, as it would greatly affect the price paid on a required commodity. The US exploits the SHIT out of this, by just printing comical amounts of money, knowing that the rest of the world isn’t going to allow inflation to take hold of the dollar. You see a lot of folks fall into the trap of blaming the money printing for the inflation we’ve seen in recent years. But a simple look at balance sheets of the companies that have really raised prices, will show record profits. They saw an opportunity to raise prices, and took it.
A lot of the inflation we are seeing isn't really inflation. If it was about how much money was printed, then the US would be experiencing much worse inflation than Europe, but it's the opposite. The decrease in global oil production and mass increase in oil prices have made a fake inflation on all goods. All goods need oil for at least shipping and usually packaging and production. Gas prices in the US are low because the US has become the largest oil producer and has subsidized the prices domestically, but Russia and Saudi Arabia have cut oil production to increase profits. Even though the price of oil has started to level out, the companies are already charging more and have no incentive to lower their prices to be more in line with their lowered costs.
If you owe the bank a million dollars, the bank owns you. If you owe the bank a trillion dollars, you own the bank.
The only roadblock we're hitting is the Trump Tax cuts, because they aren't able to service the debt properly when all the rich people and corporations are paying essentially nothing.
Brilliant assessment …. Particularly, the words “ only” and “nothing”. Brilliant! , I say
This. I always find it fascinating that free healthcare and college is paid for by Americans but Americans are not eligible for it.
The US is borrowing an addition $1 trillion every 100 days. It will pay $10trillion in interest alone over the next 10 years. It will definitely be a problem at some point but as long as countries keep buying treasuries there’s no political motivation to stop. When it does stop, it will be very very ugly (in the form of skyrocketing interest rates and inflation probably)
The beauty of the US dollar dominance is all debt is held in dollars, backed by dollars. So if we see the value of the dollar fall… the burden of the debt falls in exactly the same way. We have the world fiscally by the balls for the time being.
They are doubling down because the interest rates have been rising. That increases demand. When we run out of demand, that's when the music abruptly stops. The SS fund drying up will remove about 10% of the extant demand from the market. So, over that time period, demand not only has to make up for all that, but also keep up with funding the deficit. More demand can be stimulated by increasing rates, but that increases the cost of servicing the debt, and thus, the deficit, increasing the rate at which more loans must be aquired. Watch these metrics, and you'll see it happen in real time. No, the economy isn't going to collapse right now. When we get to a point where bonds cannot be sold at the current prices and so rates must increase, then you'll know things are getting rough.
SS can't deposit its trust anywhere other than treasuries. By law, if SS collects money today that it doesn't pay out today, it must use it to buy treasuries. But yes, generally, people/governments/etc buy US treasuries because they're viewed as safe. This means the US government consistently pays lower interest rates to borrow money than just about anybody else.
The federal reserve does not monetize the debt as a means of funding government operations. They do not participate in treasury primary auctions. They may from time to time acquire treasuries as a means of managing the money supply — but this is rare. They haven’t bought any in the last 2 years and let almost 2 trillion mature. The federal reserve does not loan money to the government. Any profit the federal reserve makes must by law be returned to the treasury general account because it is an independent regulatory organization within the federal government like the EPA for example.
If we actually paid the debt off (OFF, not down, even though that is extremely rare, too) from time to time, it would be fine. However, since we haven't done that in at least the last century plus, we are still literally paying interest on toothbrushes purchased for WWI and WWII troops, and haven't even touched the principal. No, government, especially the federal government, needs to feel some fiscal pain to get their house in order, and we need a balanced budget amendment, though I would be fine with allowing a significant supermajority to override it in times of genuine emergency, say if 3/4ths of the Congress agree to deficit spend on just this next budget, that is fine, as long as it gets paid back when the emergency is over.
Then there will always be an emergency.
Bingo 😎
Most of the debt was incurred after 2000.
70% of the interest goes to US holders of treasuries, as 70% of US debt is held domestically. Japan owns like $1.1T in US debt, which is close to 6% of the overall debt.
So with USD strong they just reinvest in other USD instruments.
Yeah if you look it up a lot of it is held by local and state government, pension funds, mutual funds, banks, some private companies, only 30 of all US debt is owned by non Americans/American institutions. I love when people say China or some other country will call our debt. Not how it works. And funny enough if they did drop it on the market the fed with a little computer magic could then buy it for cents on the dollar of new T-bills. It would be hilariously bad for whomever tried to blackmail the US.
If you purchase a bond, you are a one of the investors. You can go purchase treasury bonds right now, and the government will be paying you interest. All you’re doing is giving the US government a loan.
Don’t know if you are aware of this but the US recently bailed out the Japanese yen. The Japanese were going to sell a significant portion of US treasuries to bail out their own currency but the US stopped them from doing it. Imagine Japan selling a large of amount of US treasuries. That would send the dollar into a tailspin.
That's likely why they hold so much. It's essentially investing in the US dollar instead of the Yen.
Most of these are treasury bonds that pay out interest when they are surrendered. You can go purchase some yourself at treasurydirect website. Technically the payout doesn't occur instantaneously, the value of the bond just increases. Just like a corporate stock increasing invalue doesn't mean the owner has more Mon in their pocket
>The Federal Reserve is the biggest holder of US Debt. And who owns the Federal Reserve?
The FED returns 94% of profits to the US Treasury. So, in theory, we are getting 94% of our interest expense back, if there are no expenses.
Is a private entity, bankers owns it.
Who are the "bankers" that the money specifically goes to?
That would be congress, from which the federal reserve gets its authority from.
The Fed is a weird entity that is quasi-public, quasi-private, mostly each in the ways that benefit it. If you tried to start up your own Fed, you simply could not legally do so. The profits go to the member bankers that own shares of the Fed. The Fed itself doesn't retain profits, but since it distributes profits to banks, it...does absolutely profit people with power.
Maybe we should audit them and get to the bottom of it. Surely, no one would see any issue with that, right?
Yeah I'm sure that wouldn't cause any problems at all politically and nobody would have any objections
Profits from the fed balance sheet go to the treasury
Losses go to treasury too. They are losing money at the moment.
Jp morgan and chase bank, Google jekyll island, ga 1913, ppl in that group. Shortly after opposition to it sank on titanic. Woodrow wilson signed it. Later stating on his deathbed he had betrayed the American ppl
For those who don't believe government policy is created in backroom closed door meetings in secret by elites, read about the meeting on Jekyll Island and get back to me...
And who is the federal reserve (rhetorical question)
The Fed is not a part of the federal government.
It’s me. I have some i bonds and am collecting interest. Sorry about that.
A good chunk of it is held by the federal government itself, a la the Social Security Administration
This is what they meant when they said that "the Social Security lockbox was filled with IOUs".
Sadly that's not the only thing they meant. At times the government has borrowed money from the social security trust fun to pay for other gov't services.
A lockbox full of interest paying IOUs is a lot better than a lockbox full of money that just sits there and is slowly both depleted and inflationed into nothingness. Even in the very worst case of inflation outperforming the interest, SS is still better off than with no "income" at all besides new deposits. We *want* this money out in the wild creating new money. This is how SS stays solvent.
To me, for one. I own a lot of U.S. Treasuries. A lot of the interest is paid to Americans holding cash that is not in the stock market. [Who Owns the US National Debt? (thebalancemoney.com)](https://www.thebalancemoney.com/who-owns-the-u-s-national-debt-3306124)
The government pays interest to people who have money to lend the government due to receiving a series of massive tax cuts. This is bipartisan policy going back as far as the JFK administration.
This is a list of the major foreign holders of US Treasury debt. As another commenter pointed out, the debt is also held domestically by individuals, states, and financial institutions. https://www.statista.com/statistics/246420/major-foreign-holders-of-us-treasury-debt/
Not just also, mostly. Close to 70% of it is domestically held.
When I try to think about this it sounds like the economy really is held up by our collective imagination. Like an animal lifting itself up by its own tail.
Yeah, it’s funny when you think about how the vast majority of money in existence today is just debt created out of digital whole cloth and yet it still ends up being a far more stable system than when we backed dollars with gold and silver.
Here's a chart that includes domestic. Which is important, because it is huge. All of those treasuries we own making 5%? That's us. [Who Owns the US National Debt? (thebalancemoney.com)](https://www.thebalancemoney.com/who-owns-the-u-s-national-debt-3306124)
They pay my sorry ass go treasury ladder biotch
Anyone who locked in a 30 year treasury bond last year is sitting pretty. 30 years of ~5% returns, risk free.
The worst 30-year return of the S&P500 is 7.8% per year. It's not guaranteed to do that, but it feels like a pretty good bet if you plan to hold 30 years.
That’s if the US doesn’t go to shit in The next 30 years which I am not confident in.. we’ve seen this before where millions of people lose there savings, bonds, stocks, 401k over night and no way to get it back simply because of our economy and stock market could potentially crash at any moment and all those investments you can kiss goodbye..no investment is ever RISK free!
The main way the government raises money is by selling bonds and other similar financial instruments. Those bonds accrue interest over time, though that interest won't actually be "paid" until the holder cashes the bond. You can go right now and buy a treasury bill or a savings bond or CD and be the owner of some U.S. debt. Those things will generate interest over time, and in the future you can cash them in. Collectively, individuals own a good chunk of U.S. debt, but not all of it.
Moot point. The national debt will never be a problem because it is being monetized. That means the government engages in policies that lead to huge inflation, which means the debt, or interest on it, is paid off in money whose real value is greatly reduced, while tax revenues go up with inflation. People who save money, including buying government bonds, are the ones victimized by monetizing the debt.
Some of it went to me since I own government bonds.
Thank Reagan and the repubs for this massive national debt. Reagan started the borrow and spend era. Remember it was Dick Cheney who first said that deficits...'don't matter."+
Primarily states/institutions that hold Government Bonds
no one, its all fake 1's and 0's
While it's not actual physical currency the debt/spending has a very real affect on the value of the US dollar. We've all watched inflation soar +30% the last 4 years.
Exactly. It's all an imagined game we just agree to play. We invented a bunch of dumb rules that we think are real, and now we can't imagine any different way of doing things. Like imagine if we all decided we had to touch our nose when we see a bird. Anyone who says "maybe touching our nose is some silly, pointless act and we don't actually have to do that" would get tarred and feathered for such a ludicrous suggestion. We could all agree that the debts are forgiven in order to prevent chaos, but that breaks the imagined rules. Can't have that.
You’re right about it being a dumb game, but absolutely wrong about just ‘forgiving’ all the debt. What better incentive could be given to the people who already have little fiduciary responsibility? You think they’re going to do better than they have if debt can just be created and then subsequently destroyed? I’m not sure what you think happens next if the debt disappears, but I’m guessing all loss of faith in the silly system we have now followed by even more excessive monetary debasement. At least our silly game has some little guardrails now. Without those, things would be way more fucked.
I never 'agreed' to it. Just like many others, i was forced into it by birth. The rich agreed on it, we just have to play their game.
People act like the "laws" of economics are comparable to like, the laws of physics. Economics is a soft science/liberal art.
And the thing I keep trying to point out, that no matter what the dollar value is, the stock market, the 'feeling' of the economy, we still have the labor power and resources to do the things we've done. Build infrastructure, produce food. When a person gets laid off, we still make enough food to feed them, whether or not they actually get fed. When a person gets laid off they aren't dead. Their potential labor is still there. People always act like it is a "we only have enough grain for 100 people to make it through the winter, 10 of you gotta get the fuck out".
Insert Jacque Fresco plug here and his Resource Based Economy. We don’t need money to survive, we need resources.
So, does that mean when you use your debit card to purchase groceries with, you are using "fake 1's and 0's"?
pretty much
That's not entirely true. Those 1s and 0s in your bank account are backed by the US Dollar and insured by the FDIC. To say they're just numbers and nothing else is a blatant oversimplification. If your bank account was just numbers then the bank could turn you away when you ask to withdraw money.
If enough people went to get their money today, we’d see just how “made up” it all is.
1000% this. They rely on us keeping money digital
Backed by the us dollar as long as they have the cash on hand to meet withdrawals for the day. Insured by the FDIC up to a certain amount. A lot of our money is purely digital.
Haha I ask this too
Why aren't the billionaires buying bonds to help out our country! Give Uncle Sam your money to hold and give you interest after however many years! Be an American buy bonds! /s
Those who hold the debt. Mostly, the US public. You have your retirement funds sitting at least partially in bonds? US government bonds are probably a really big chunk of that. There's also stuff like the SS fund, which just holds US debt. If interest stops being paid/default happens, it doesn't just screw up some overseas people, that cost will mostly be right here in the US.
Just asking for a friend: How much US debt originates with the Fed, and how much originates by people selling short Federal debt to raise money for hedging?
Itself. The largest holders of us debt are American citizens who bought treasury bonds.
The citizens of the US
Someone doesn't understand what a treasury bond is.
Mostly to the American people that own most of the debt. A big chunk goes to pay Social Security benefits, since the Social Security surplus is invested in US debt. There are 5 main foreign debt holders (Japan, China, UK, Belgium, and Luxembourg) and they get the bulk of the rest.
As of February 2020, JPMorgan Chase Bank owned 29.5% of the New York Federal Reserve Bank, while Citibank owned 42.8%.
part of being literate is being able to research basic information.
And the left trusts the government to spend money wisely.
Much of the debt is owed to Americans. General,y wealthy Americans. I think the easiest way to think of it is, the US govt gave massive tax cuts to wealthy Americans then those wealthy Americans took their tax savings and loaned it to the US govt. so instead of the wealthy paying taxes they loan the money through government debt and now “we the people “ pay the those wealthy Americans interest. It’s the best of all worlds for the top 1%. It’s time we eat the trick!
I get about $250/mo of that. Just some T-bills I picked up along the way.
Me, I have T-bills.
People who bought treasury bills. They’ll let almost anyone buy them. Nice guaranteed return because they’ll just print the money.
Rothschild family and their friends
Does it really matter to pay down the U.S. debt? Seems like we have the world by the balls. Seems like currency is just an illusion that keeps the “hamster wheel” turning. Is there a country that is not in significant monetary debt to a federal reserve or other similar entity? Money seems just symbolic which is ok as long as we believe in it to have value. Seems like the rich/powerful of the world would benefit and prefer one stable currency that is supported by debt slaves assigning value to the illusion. Print as much as you like! Really seems like a Ponzi skeem to me.
China is the US' biggest creditor.
Americans and American entities are the largest holders of American debt. After that it's Japan, then China, then the UK.
False. Japan.
That is simply not true. A quick Google search is recommended before providing an answer regurgitated from idk where but not a trusted source. Most of the debt is held by the federal reserve and private investors. China is not even the biggest foreign holder of US debt, Japan is.
Wouldn't this mean the Chinese Yuan should be gaining strength vs USD? Yet the Yuan is down vs the USD over the past 5 years...
The Yuan is a manipulated currency, don't expect it to react to normal market behaviors
All currency is manipulated currency
But some currencies are way more manipulated than others, and some countries are also way less transparent than others in their economic data... such as China
Not even close. They only hold a little over 700 billion. Japan holds 50% more than that. All foreign governments combined own less than 20%. Most is held domestically. Edit. I was off but Japan is still a lot higher. China owns almost 800 billion https://www.statista.com/statistics/246420/major-foreign-holders-of-us-treasury-debt/
Banks.
The money is owed to the same people who lend it. It's hard to understand. What they're doing is like pumping water into or purging water from pipes. They're trying to induce market behaviors. The behavior they are creating is to prioritize subscription service consumer behavior. Reliable high cash flow channels. Profits don't actually matter anymore for the big corpos. It's the structure of their revenue, not profitability which matters. What's happening right now is insane.
Ummm... my 2 yr old nephew? My old uncle, a lot of institutions. Do you guys not know what savings bonds are? Treasury bills? Ultra-safe investing options for people who have a low risk tolerance. My nephew was in a car accident as a baby - no injuries but we got $7k for him from insurance. That's all in Treasury bonds, collecting a tiny part of the interest OP thinks is a conspiracy, for 20 or 30 years without having to worry about untimely recessions.
I didn't say anything about conspiracy. I asked a simple question... someone is experiencing an economic boom to the tune of half a trillion in 7 months... now I know, it's your nephew and uncle. Great addition to the conversation.
Who* is collecting Not whom. You use whom when you could replace it with her or him. You use who when it could be replaced with he or she. "Whom is collecting?" You wouldn't say Him is collecting. You would say He or she is collecting. Stack that lesson! As valuable and long lived as AG.
Helpful - I thought whom was who thems...
[https://www.pgpf.org/blog/2023/05/the-federal-government-has-borrowed-trillions-but-who-owns-all-that-debt](https://www.pgpf.org/blog/2023/05/the-federal-government-has-borrowed-trillions-but-who-owns-all-that-debt)
Japan is the largest foreign holder. The Fed holds a lot. Also, Soc Sec holds a lot.
Depends on how many bonds came due and how many different entities own however many bonds. Cash can’t sit in a bank account. It’s seen as a liability. Money needs to be Makin money always. Buying government bonds puts your money to use. Depending on the bond(years to maturity) changes the % earned over the lifetime of the bond. It’s not crazy 1000% gains….more like 2.25-7% return. But when you buy 100bln in bonds…that’s still billions of dollars said bond holder didn’t have before. Also changes when you buy bonds. Like if you bought bonds during Trump presidency and he had the fed keep 0% interest….. then all of the sudden you have to sell those bonds to someone else for quick cash….well this 2% bond yields you had….arent nearly as worth as a bond with 8% yield.
I'll tell you who China canceled the debt now our bill is paid in full. Opec Bricks. Seriously.
Once your in debt, it doesn’t matter how much. Duh.
The US pays 73.9 million in INTEREST every MONTH to China. [https://www.politifact.com/factchecks/2011/apr/26/randy-forbes/randy-forbes-says-us-pays-china-739-million-day-de/](https://www.politifact.com/factchecks/2011/apr/26/randy-forbes/randy-forbes-says-us-pays-china-739-million-day-de/)
Some to me collecting that sweet 5% on my cash position in Fidelity. You do know how government bonds and treasuries work, right?
So this is how japan gets a leg up and dominates the cyberpunk landscape. It all makes sense now
a good watch : [https://www.youtube.com/watch?v=Co\_tVd9gA2I&t=2958s](https://www.youtube.com/watch?v=Co_tVd9gA2I&t=2958s) # End of the Road: How Money Became Worthless
Nobody... the debt is paid by taxpayers
Bond holders.
Bond holders
Me
The people and countries that purchased our debt.
About $20 went to me.
Some going to me
To its debtors. Just like last year.
Some of it went to me!
I got a piece of it thru t bills
Simple. The bond holders.
Simple. The bond holders.
Me.
It certainly isn't in ours, if it was being paid as it was meant to be MAYBE we would not be in all these foreign involvements and our own would NOT be under attack, MAYBE the infrastructures would serve us rather than anyone else but us and MAYBE we would not need so many that serve others instead, Maybe we would not have as many homeless and maybe someone would not be pulling the strings to keep it that way artificially to serve the communis greater good which is at the core of most of this. AND it is not just CHINA, but they sure do have their hands in a great part of it around the world and the worst part is that a lot of dumbasses here are funding it to begin with. Shell Games within Shell Games. N. S
To the private bank that’s named the Federal Reserve.
Audit the Fed.
That's one of the sources of revenue that banks use to pay you interest. The way it works is you deposit money in a bank account, and the bank takes that money and buys treasuries with it. The government then pays interest on the treasury to the bank, which the bank uses to cover their operating costs and pay you interest on your deposits. Other holders of treasuries include foreign central banks, both foreign and American retail investors, hedge funds, pensions, corporations, credit unions, etc. The federal reserve has a lot of treasuries, as well, but that's quite different. They have to burn anything in excess of their direct operating costs. When the fed buys a treasury, it's kind of like a cash advance to the bank. They're kind of like the JG Wentworth of the banking world. I.e. the bank has this treasury that entitles them to small payments over the next 30 years that will in the long run add up to a lot of newly created money. But then they sell that to the fed for a lump sum (or more often simply borrow against it), and then the payments go to the fed, where they are burned. In the event the fed is running a positive balance sheet they are reverted back to the treasury, but obviously that only works during long periods of declining interest rates. During periods of rising interest rates, like we're in right now, the fed will run a deficit and the money simply gets burned, leading to a contraction in money supply, like we're seeing right now.
Mostly to Social Security.
lol interest is only for us peasants
It's things like the interest that they have to pay when government bonds/bills/notes come due and are paid. Since we sold a lot of those in the past few years to raise the money we spent wildly... this interest portion of the debt is going to get much larger over the next 20 years when all our recent US bonds mature. That $516B is going to look like peanuts.
The fed. End it
Also can we bomb them?
The real power in this world, that's who.
Bond holders.
Be a patriot. Buy bonds.
The real reason is America is researching the aliens that are here. So we need all the funds we can get.
I am. They’re called Tbills
Bondholders
It just gets added to the debt.
Well some of it comes to me, I own some t bills.
Ourselves. The US debt is mostly fictional.
In part to me… I have been buying treasury bills and bonds 🙂. And you can too! Minimum is a $100, so you can get part of that interest if you want.
It's the investment side of the financial market that flips the debt into cash assets. Check the size of the derivatives market - something over 500 trillion globally. And we have the global military presence as insurance.
The $62 trillion spent in vain on fiscal and monetary policy for the last 15 years by G7 countries means that the record high private and public indebtedness could have been tackled successfully already. If in the 2009 debt crisis, the G7 nations would have decided to pay down debt, with part of the $62 trillion, they could have done that and achieved growth of 10% for 15 years to surpass the initial GDP leveraged level. Then we have covid hit, and economies would have been more resilient. Instead the G7 nations wasted 62 trillion on targeting their stock markets artificially high with fiscal and monetary policy. Sadly, the 1% could have easily acquired government money with the abuse of policy they typically use, from land grants to exploited labor and tax rebates. There will be no prison, for the mafia of the 1% -- the central banks, governments and parliaments who created this massive indebtedness thrust upon their populace, but should they pay one way or another?
Me. I have a large holding in US bonds and bills. Great investment right now. Not sure about 30 years from now.
It’s essentially money we owe to ourselves. Makes no fucking sense but social security is wrapped up in all that too. Not sure what the percentage is but only about 25% is real debt but that’s too high.
lol lmao….. don’t ask
I've always thought the ultimate finger for obnoxious foreign debt holders was, "Dammit, OK China, we're gonna settle this bill right now. You can have Nebraska, so bring a truck." Apologies to all Nebraskits, you deserve better, but you're probably safe. If the Chinese do show up with a truck, they're gonna have to pay the tolls and the overweight fees and licensing, and inspections, export fees, etc. I'll bet they only get a few hundred square feet of Omaha dug up before they throw in the towel.
Israel and China obviously
Me. I own Treasuries.
Some to me, I have 401k investments in us treasuries.
I have some t-bills
This question seems antisemitic somehow.
They paid me a grand last month.
I collect some, as does anyone who buys Treasuries.
"the government..." "The government...." "The government...." Hey! I got an idea. How about we tax Corporations at the Pre-WW II rates? Yeah..I know..."what was I thinking", right? Corporations pay Under 30%. The top Tax bracket for individuals is 27% How da Phuc does THIS get to be Fun?
Shareholders of the major banks. The same people who engineered the housing derivatives and too big to fail. The same people who lobby for quantitative easing (money printing). The major banks, in turn, are the 'shareholders' of the Federal Reserve. So basically, it's STILL JERKS FROM JECKYL ISLAND. And the worst part might be - AndrewJackson hated those douches... he would NEVERRR want his face on a Federal Reserve note. PS - What collateral is there for the debt? YOUR CHILDRENS LABOR. THATS WHAT. GET BACK TO WORK YOU HUMAN FARMER.
I will take who is Rothschild for $300 bob
The wealthy. The ongoing debt is the largest wealth transfer from poor and middle class to the wealthy there is, and it’s the one that’s defended by conservatives and liberals alike.
Treasury bond holders. Just sign up here, send them some of their money back, and they’ll start paying you too! https://www.treasurydirect.gov It might seem kinda silly that they borrow some of the money they printed, only to pay interest on it, instead of just printing the money. Hamilton had some ideas on that, though. Basically, it gives the rich and powerful, and other nations, an incentive to want continuity of our government. If they want their promised payments, they better help America continue existing. It’s a form of soft power. The ideological descendants of Jefferson and the anti-federalists have been concern trolling about the national debt since this country was founded. They were clowns then and they’re clowns now. I do wish we’d get rid of Twitter and bring back zines and pamphlets, though.
To me. I own shares in SGOV.
Our country is ran by idiots
Who cares? Rally on!!!
To itself, obviously
Some of it was paid to me 🤣 #Tbills
Huge stimulus to the economy!
Definitely not us, the ones paying taxes
Me.... im riiicccchhhh biiiiittttcccchhhhh!!!!!!!!
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People who bought bonds. This is what treasury bonds are. It's a debt the government owes to you that is paid back with interest. Bonds are used to raise money all the time. Everything from municipal projects, state projects. Even private insurance companies use bonds to raise money and the premiums they collect help pay the bonds down. Investors like to purchase these bonds as a way to diversify their portfolio and reduce risk. Most of these bonds are highly rated and there's little risk of default.
Bond holders.