Thursday, December 10, 2009

Who owns the sovereign debt of the United States? 

It is not at all clear whether it is better to owe U.S. dollars or be owed them -- that question rests largely on the character of the American people and the politicians we elect over the next generation. These are the countries that are the most interested in the answer to that question:

Geography of Debt


By Blogger Charlottesvillain, at Thu Dec 10, 08:59:00 PM:

I assume "other" is the Fed?  

By Blogger Purple Avenger, at Thu Dec 10, 09:23:00 PM:

Those countries will all do fine -- we'll pay'em back in unicorn pelts.  

By Anonymous Anonymous, at Thu Dec 10, 10:07:00 PM:

So is this graph saying that 3.428 billion dollars of our 1.38 trillion dollar federal debt is held by foreign entities and the rest is held by domestic entities?

Or am I reading the graph wrong?

That would mean only .2% of our federal debt is held by foreign entities. That seems awfully low.  

By Blogger Gary Rosen, at Fri Dec 11, 02:36:00 AM:

Anon 10:07 - I think in Britain or somewhere "m" may mean "milliard" which is actually a billion. So that would make the debt 3.428 *trillion*. You are right, if it is "only" 3.428 billion that is actually very low - "a billion here, a billion there, pretty soon you're talking real money".  

By Anonymous Raving Lunatic, at Fri Dec 11, 08:51:00 AM:

Yeah, I think either that's a typo on the chart or the chart is British in origin, because it should be 3.4 trillion in debt.

Alos, Anon, the 1.38 at the bottom is the deficit, not debt. That's the shortfall for this year, i.e. the government has spent 1.38 trillion it did not have. This will be added to the national debt, currently (in total) around 12.9 trillion dollars.  

By Anonymous Anonymous, at Fri Dec 11, 12:28:00 PM:


A UK-long "thousand million" or "milliard" is a North American short "billion"; and a UK-long "billion" is a North American short "trillion".

I'm a moron, so I don't know if the #3428m is in milliards or if anything over $999 milliards (i.e. 1000 or the 3428 of the example) is the flip over to their billions (N.A. trillions).

I'm guessing it's $3.428 trillion.

By Blogger Cas, at Fri Dec 11, 08:22:00 PM:

How ironic; that countries that we spend billions to protect, such as Japan, Taiwan, Germany, Korea (I assume that this refers to ROK, NOT DPRK), and even those countries that we GIVE money to (Egypt, Israel), all own American debt. We have no one but CONGRESS to blame, but after all, we voted for them!  

By Anonymous Anonymous, at Sat Dec 12, 12:49:00 PM:

Cas, DPRK is at the top, where it says, "China (Mainland)".  

By Blogger ZZMike, at Sat Dec 12, 09:47:00 PM:

There's an old saying - if someone owes you a million $$, he's a debtor. But if he owes you a trillion $$, he's a partner.  

By Blogger Andy from Beaverton, at Sun Dec 13, 02:44:00 PM:

I get real tired of these institutions printing misleading and/or incorrect information.

The $3.428t in total Major Foreign Holders of Treasury Securities is not from 08/2009, it is from the end of 07/2009. The real numbers should be as follows:
08/2009: $3.452t
09/2009: $3.497t
You can find that data here: http://www.treas.gov/tic/mfh.txt

The fiscal year for the government does not end at the end of August, it is September. For some odd reason, they are telling us the year's deficit after 10 months at the bottom of the graph? The total outstanding public debt is as follows:
9/30/2008 $10,024,724,896,912.49
9/30/2009 $11,909,829,003,511.75
The total debt increased $1,885,104,106,599.30, not the published $1.38t you see in the chart. You can find this data out for yourself here:http://www.treasurydirect.gov/NP/BPDLogin?application=np

The total at the bottom of the graph has nothing to do with the graph, it should be the total debt that has increased over the past year to foreign holders. At the end of fiscal year, the debt was ~$2.800t. For 2009, it is $3.497t. So the total debt to foreign holders during the past year is ~$700 billion.

If you are wondering why our actual total deficit was ~$1.9t instead of the reported ~$1.3t, you can find it here in the last quarterly report: http://fms.treas.gov/bulletin/backissues.html If you aren't used to reading these reports, you can start looking into Asset Acounts. It doesn't contain all of the missing plus half trillion, but most of it.
Total Asset Accounts (in million of dollars)
9/30/04 237,426
9/30/05 225,211
9/30/06 220,931
9/30/07 262,988
9/30/08 591,747
8/30/09 904,838

If anyone has followup comments, just reply to this post and I will try and answer them. I'm going to send this over to FST and try and get them to stop publishing trash that would pass in a basic economics course.  

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