China, Japan Top List of Foreign US Debt Holders

Unless you've been living under a rock, you know that the United States is trillions of dollars in debt.

As a matter of fact, the current outstanding public debt of the United States is just over $11 trillion dollars. This means that every man, woman and child in the United States owes around $36,000.

In order to combat the economic meltdown that we are currently living through, the United States government is throwing trillions of dollars around, desperately trying to reflate the economy.

The United States doesn't have trillions of dollars in cash lying around, so they rely on the sale of debt in order to fund their various initiatives.

Fortunately for the United States, foreign governments have been snapping up US debt, especially over the past couple of years.

The reason? In the midst of a crippling global recession, US debt is thought to be the safest place to park money.

If you have a hundred billion dollars to invest, and want a liquid investment that is going to maintain its value, where else are you going to invest? There is a reason why foreign governments are still buying hundreds of billions of dollars in US treasury securities.

So which countries currently own the most US debt?

Here is the top ten, taken straight off of www.treas.gov (link below):

1. China, $739 billion dollars
2. Japan, $634.8 billion dollars
3. Oil Exporters*, $186.3 billion dollars
4. Caribbean Banking Centers**, $176.6 billion dollars
5. Brazil, $133.5 billion dollars
6. United Kingdom, $124.2 billion dollars
7. Russia, $119.6 billion dollars
8. Luxembourg, $87.2 billion dollars
9. Taiwan, $73.3 billion dollars
10. Hong Kong, $71.7 billion dollars

Note: This is current as of January 2009

*includes countries such as Iraq, Iran, Kuwait, Venezuela and Saudi Arabia
**includes countries such as Bermuda, Cayman Islands and the Bahamas

Now, a few things jump out at me as I surveyed the list and the data:

1. China's holdings have jumped by nearly $200 billion dollars over the past 6 months

2. The United Kingdom's holdings have nearly doubled since July of 2008

3. Canada isn't in the top 30?

4. Will China continue to snap up US debt, given their recent comments regarding the overall safety of the investment?

Source: Major Foreign Holders of Treasury Securities

Filed under: General Knowledge