[QUOTE]WASHINGTON (AP) -- China reduced its holdings of U.S. Treasury debt in May as total foreign holdings of government debt posted a slight increase.
China's holdings fell by $32.5 billion to $867.7 billion, the Treasury reported Friday.
The report said that total holdings of Treasury securities edged up $5.8 billion to $3.96 trillion in May, a slight increase of 0.1 percent compared to April.
The Treasury said that net purchases of long-term securities, a category that covers not only U.S. government debt but also debt of U.S. companies, increased by $35.4 billion in May. That followed bigger gains of $81.5 billion in April and $141.4 billion in March.
While the May figure was down from the previous two months, analysts said it still reflected significant interest on the part of foreigners in holding U.S. government and corporate debt.
That demand has been spurred in recent months by a debt crisis in Europe that has prompted a flight to safety. U.S. Treasury securities are considered the safest investment in the world because the U.S. government has never defaulted on its debt.
Analysts said foreign demand has also been spurred by the fact that even though the U.S. economic recovery has been half-speed, the growth rates are still more than double what is occurring in Europe.
"The United States remains a safe haven for investments and remains a place where investors have confidence," said Gregory Daco, a senior economist at IHS Global Insight. "Growth is the key."
Daco said he expected investment would remain strong in coming months, in part because he said the outlook is for U.S. growth, even though it is slowing, to remain higher than European economic growth.
China is the largest foreign holder of Treasury securities. The 3.6 percent drop in China's holdings in May followed two months of increases. Those holdings are being closely watched because of concerns that at some point China might start shifting its investments out of Treasury securities into other investments, a move that would boost financing of America's huge budget deficits.
The federal deficit hit an all-time high of $1.4 trillion last year and is forecast by private economists to total $1.3 trillion this year.
The financial crisis which hit in the fall of 2008 pushed U.S. interest rates down significantly after foreign investors rushed to the safety of U.S. government bonds. That development helped reduce the costs of financing federal budget deficits even as though deficits have been surging.
Japan, the world's second-largest holder of Treasury securities, also cut its holdings in May, to $786.7 billion. That's a drop of 1.1 percent from April.
However, the United Kingdom, the third-largest holder, posted a 9 percent increase. Its Treasury holdings rose to $350 billion.
(This version corrects total figure for foreign holdings)[/QUOTE]
Source: [url]http://finance.yahoo.com/news/China-reduces-US-Treasury-apf-3291157593.html?x=0[/url]
America is already so far in debt that this won't matter.
Kind of sad it has come to this.
We fucked up, and fucked up badly.
You'd think that the great depression would've have taught us something,
but people forget so quickly.
And when we fall, its gonna drag the rest of the world down with us :sigh:
Except being America most people aren't going to try to collect on any debts we have with them.
Also, why is it that when we help people and spend trillions of dollars to help other nations recover, they give jack shit back?
Ungrateful bloody cunts.
[QUOTE=teh pirate;23425450]Except being America most people aren't going to try to collect on any debts we have with them.
Also, why is it that when we help people and spend trillions of dollars to help other nations recover, they give jack shit back?
Ungrateful bloody cunts.[/QUOTE]
You don't give aid to get aid back. America doesn't need it. Uganda does.
You don't "collect" debts like that anyway. Debts are paid in preset amounts over the course of years. If the government decides to, it can pay these back faster, but it's not the debt holders decision and as long as he is paid the amount agreed upon on day one, he can't do shit.
As the American government has never once in it's history missed a payment, it's still considered a very stable system.
[QUOTE=Regulas021;23425516]You don't give aid to get aid back. America doesn't need it. Uganda does.
You don't "collect" debts like that anyway. Debts are paid in preset amounts over the course of years. If the government decides to, it can pay these back faster, but it's not the debt holders decision and as long as he is paid the amount agreed upon on day one, he can't do shit.
As the American government has never once in it's history missed a payment, it's still considered a very stable system.[/QUOTE]
I've never really researched governmental debt so I have no idea how they work. I learned something today.
[QUOTE=teh pirate;23425450]Except being America most people aren't going to try to collect on any debts we have with them.
Also, why is it that when we help people and spend trillions of dollars to help other nations recover, they give jack shit back?
Ungrateful bloody cunts.[/QUOTE]
What nations has America helped recover?
So help me if you say anything about the middle east.
[QUOTE=Strongbad;23424984]America is already so far in debt that this won't matter.[/QUOTE]
That's a bad way to look at anything dealing with money. Every bit counts.
[QUOTE=IStanI;23425572]What nations has America helped recover?
So help me if you say anything about the middle east.[/QUOTE]
I'm guessing you've never heard of the Marshall Plan.
[QUOTE=IStanI;23425572]What nations has America helped recover?
So help me if you say anything about the middle east.[/QUOTE]
Do I need to compile a list? We've contributed to virtually everybody in the past, even political enemies.
Pointless wars and unneeded social programs tend to cause debt.
[QUOTE=Regulas021;23425516]
You don't "collect" debts like that anyway. Debts are paid in preset amounts over the course of years. If the government decides to, it can pay these back faster, but it's not the debt holders decision and as long as he is paid the amount agreed upon on day one, he can't do shit.
As the American government has never once in it's history missed a payment, it's still considered a very stable system.[/QUOTE]
I'm pretty sure that China etc can demand immediate payment, sure they're unlikely to but I think they can if they so wished.
[QUOTE=SteelReal;23425802]Pointless wars and unneeded social programs tend to cause debt.[/QUOTE]
Learn economics, pretty much all countries cycle from deficit to surplus, it's not unnormal nor overly dangerous. After an economic boom it's normal for a country to have built a current account decifit.
[QUOTE=SteelReal;23425802]Pointless wars and unneeded social programs tend to cause debt.[/QUOTE]
Social programs reduce debt in the long run. When you pump money into healthcare and education you improve standards of living which gets money flowing faster.
Also, people budget with taxes in mind. They don't budget for the sudden loss of a scholarship or cancer. If the government pays for healthcare and education through a tax-supported system it increases the stability of the economy. Think of all the people in debt because of healthcare bills and tuition fees. Now imagine that they're all gone. People will have money that they'll be spending. That's good for the entire country.
[QUOTE=IStanI;23425572]What nations has America helped recover?
So help me if you say anything about the middle east.[/QUOTE]
germany and japan
[QUOTE=Strongbad;23424984]America is already so far in debt that this won't matter.[/QUOTE]
Have you even taken a high-school level business course? If you bothered to take one, or GOD FORBID, even read news related to the economy, you'd realize how flat-out wrong your statement is. I'd suggest you do the former, if not the latter as well.
I'm sure YOU have. :rolleyes:
Every bit of news I've read, and the fact that it now costs 3.00$ for a half-gallon of milk at the grocery store near my house on sale, points to the economy being shittier than the sewers of London.
[QUOTE=Strongbad;23447209]I'm sure YOU have. :rolleyes:
Every bit of news I've read, and the fact that it now costs 3.00$ for a half-gallon of milk at the grocery store near my house on sale, points to the economy being shittier than the sewers of London.[/QUOTE]
Where the fuck do you live? It doesn't even cost that much from farm stands and such around here. (Eastern Mass.)
[QUOTE=teh pirate;23425450]Except being America most people aren't going to try to collect on any debts we have with them.
Also, why is it that when we help people and spend trillions of dollars to help other nations recover, they give jack shit back?
Ungrateful bloody cunts.[/QUOTE]
Uh, when you aided the UK after WW2, you sort of forced us to pay every penny back.
In fact, that was the case with a ton of nations after WW2.
It's just that nowadays, the countries you are aiding, everyone else is aiding as well.
And the reason they ain't giving you money back, is the same reason that we're giving them aid.
[QUOTE=Cloak Raider;23447550]Uh, when you aided the UK after WW2, you sort of forced us to pay every penny back.
In fact, that was the case with a ton of nations after WW2.
It's just that nowadays, the countries you are aiding, everyone else is aiding as well.
And the reason they ain't giving you money back, is the same reason that we're giving them aid.[/QUOTE]
No we didn't we just asked for bases across all of UK's territories instead.
In fact to my knowledge the only Ally country that was seeking reparations was Russia and it was from the defeated countries such as Germany for damages and to
weaken the country even further.
An example would be the Destroyers for Bases deal during the war.
[quote=Wiki]The [B]Destroyers for Bases Agreement[/B] between the [URL="http://en.wikipedia.org/wiki/United_States"]United States[/URL] and the [URL="http://en.wikipedia.org/wiki/United_Kingdom"]United Kingdom[/URL], September 2, 1940, transferred fifty [URL="http://en.wikipedia.org/wiki/Destroyer"]destroyers[/URL] from the [URL="http://en.wikipedia.org/wiki/United_States_Navy"]United States Navy[/URL] in exchange for land rights on British possessions. The destroyers became the [URL="http://en.wikipedia.org/wiki/Town_class_destroyer"]Town class[/URL].[/quote]
source: [URL]http://en.wikipedia.org/wiki/Destroyers_for_Bases_Agreement[/URL]
[QUOTE=Cassettic;23449994]No we didn't we just asked for bases across all of UK's territories instead.
In fact to my knowledge the only Ally country that was seeking reparations was Russia and it was from the defeated countries such as Germany for damages and to
weaken the country even further.
An example would be the Destroyers for Bases deal during the war.
source: [URL]http://en.wikipedia.org/wiki/Destroyers_for_Bases_Agreement[/URL][/QUOTE]
Lend Lease was paid back by all involved nations, and Germany paid a lot of reparations actually. I'm pretty sure they only JUST finished paying it back in 2008.
We give out so much in Aid that a lot of our Debt with other countries should just be wiped away!
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