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Why China Is Fleeing US Treasuries

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2 points by marvin-hansen a year ago · 2 comments

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nabla9 a year ago

Marxian economist Richard Wolff starts with erroneously claiming that China and Japan are the biggest lenders to the US government.

Only 22% of US government debt is owned by foreign countries. Most of the debt is domestic.

  Japan $1.1T 3% 
  China $0.8T 2%
  • defrost a year ago

    It's bookkeeping semantics .. the biggest lender to the US government ahead of Japan, which is ahead of China, is the US government.

    Some might describe this as:

      Intragovernmental debt records a transfer from one part of the government to another, and therefore has no net effect on the government’s overall finances. As of December 2023, intragovernmental debt totaled $7.0 trillion, a $2.0 trillion increase from a decade ago. In almost all cases, such debt is held in government trust funds — accounting mechanisms to track money designated for a specific purpose or program.
    
      The largest holder of intragovernmental debt is the Social Security Old-Age and Survivors Insurance Trust Fund, which holds about $2.6 trillion, or 38 percent of intragovernmental debt. Other accounts holding such debt include retirement funds for federal employees, Medicare’s Hospital Insurance Trust Fund, and the Highway Trust Fund.
    
    ~ https://www.pgpf.org/article/the-federal-government-has-borr...

    Another description of the US debt is: https://usafacts.org/articles/which-countries-own-the-most-u...

    And there are other takes.

    It's accurate in a sense to rate Japan and China as the largest non US Gov. lenders to the US Gov.

    This is a rabbit hole of definitions and viewpoints.

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