Regardless of how much closer Obama's budget brings our economy into a balance of payments not seen since 2001, we will continue to run deficits for the next decade, and the national debt will keep growing every year that happens. While most of the country's $14 trillion debt is held by private banks in the U.S., the Treasury Department and the Federal Reserve Board estimate that, as of December, about $4.4 trillion of it was held by foreign governments that purchase our treasury securities much as an investor buys shares in a company and comes to own his or her little chunk of the organization. Here we break down the top 10 foreign holders of U.S. debt, comparing each creditor's holdings with the equivalent chunk of the United States they "own," represented by the latest (2009) state gross domestic product data released by the U.S. Bureau of Economic Analysis. 1. Mainland ChinaAmount of U.S. debt: $891.6 billion Share of total foreign debt: 20.4% Building on the holdings of its associated territories, China is the undisputed largest holder of U.S. foreign debt in the world. Accounting for 20.4% of the total, mainland China's $891.6 billion in U.S. treasury securities is almost equal to the combined 2009 GDP of Illinois ($630.4 billion) and Indiana ($262.6 billion) in 2009, a shade higher at a combined $893 billion. As President Obama -- who is from Chicago -- wrangles over his proposed budget with Congress he may be wise to remember that his home city may be at stake in the deal. 2. Japan Amount of U.S. debt: $883.6 billion Share of total foreign debt: 20.2% The runner-up on the list of our most significant international creditors goes to Japan, which accounts for over a fifth of our foreign debt holdings with $883.6 billion in U.S. treasury securities. That astronomical number is just shy of the combined GDP of a significant chunk of the lower 48: Minnesota ($260.7 billion), Wisconsin ($244.4 billion), Iowa ($142.3 billion) and Missouri ($239.8 billion) produced a combined output of $887.2 billion in 2009. 3. United Kingdom Amount of U.S. debt: $541.3 billion Share of total foreign debt: 12.4% At number three on the list is perhaps our closest ally on the world stage, the United Kingdom (which includes the British provinces of England, Scotland, Wales and Northern Ireland, as well as the Channel Islands and the Isle of Man). The U.K. holds $541.3 billion in U.S. foreign debt, which is 12.4% of our total external debt. That amount is equivalent to the combined GDP of two East Coast manufacturing hubs, Delaware ($60.6 billion) and New Jersey ($483 billion) -- which was named, yes, after the island of Jersey in the English Channel. The two states' combined output in 2009 came to $543.6 billion. 4. Oil Exporters Amount of U.S. debt: $218 billion Share of total foreign debt: 5% Another grouped entry, the oil exporters form another international bloc with money to burn. The group includes 15 countries as diverse as the regions they represent: Ecuador, Venezuela, Indonesia, Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, the United Arab Emirates, Algeria, Gabon, Libya, and Nigeria. As a group they hold 5% of all American foreign debt, with a combined $218 billion of U.S. treasury securities in their own treasuries. That's roughly equivalent to the combined 2009 GDP of Nebraska ($86.4 billion) and Kansas ($124.9 billion), which seems to be an equal trade: The two states produce a bunch of grain for export, which many of the arid oil producers tend to trade for oil. 5. Brazil Amount of U.S. debt: $180.8 billion Share of total foreign debt: 4.1% Rounding out the top five is the largest economy in South America, Brazil. The country known for its beaches, Carnaval and the unbridled hedonism that goes along with both has made a big investment in the U.S., buying up $180.8 billion in American debt up to December. That's almost equal to the $180.5 billion combined GDP of Idaho ($54 billion) and Nevada ($126.5 billion), a state that is no stranger to hedonism itself. 6. Caribbean Banking Centers Amount of U.S. debt: $155.6 billion Share of total foreign debt: 3.6% You have to have cash on hand to buy up U.S. government debt, and offshore banking has given six countries the combined capital needed to make the Caribbean Banking Centers our sixth-largest foreign creditor. The Treasury Department counts the Bahamas, Bermuda, the Cayman Islands, the Netherlands Antilles, Panama and the British Virgin Islands in this designation, which as a group holds $155.6 billion in U.S. treasury securities. That's equivalent to the GDP of landlocked Kentucky ($156.6 billion), whose residents may not actually mind if they were ever to become an extension of some Caribbean island paradise. 7. Hong Kong Amount of U.S. debt: $138.2 billion Share of total foreign debt: 3.2% At No. 7 on the list of our foreign creditors is Hong Kong, a formerly British part of China that maintains a separate government and economic ties than the communist mainland. With $138.2 billion in U.S. treasury securities, the capitalist enclave could lay claim to Yellowstone Park and our nation's capital: The combined GDP of Wyoming ($37.5 billion) and Washington D.C. ($99.1 billion) totaled $136.6 billion in 2009. 8. Canada Amount of U.S. debt: $134.6 billion Share of total foreign debt: 3.1% They say that a friend in need is a friend indeed, and our neighbor to the north has proven to be a kind and generous creditor in our time of financial need. Canada holds about 3.1% of our foreign debt, or $134.6 billion. If friend were to become enemy and Canada were looking to annex some U.S. land to cover the debt though, the country would have an easy time of it. The combined GDP of Maine ($51.3 billion), New Hampshire ($59.4 billion) and Vermont ($25.4 billion) comes close to Canada's debt holdings at $136.1 billion. Residents of the three states in our extreme northeast corner should start practicing their French: They might become Québécois one of these days. 9. Taiwan Amount of U.S. debt: $131.9 billion Share of total foreign debt: 3.0% Taiwan, an island barely 100 miles off the coast of China, is claimed by the People's Republic of China, despite having its own government and economic relations with the outside world. Part of those economic relations includes the island's holding of $131.9 billion of U.S. debt, roughly equivalent to the combined GDP of West Virginia ($63.3 billion) and Hawaii ($66.4 billion), which totals $129.7 billion. Unless we get our spending in check, we risk losing some of our most visually stunning territory (West Virginia, obviously) to our friendly neighbors on the other side of the Pacific Ocean. 10. Russia Amount of U.S. debt: $106.2 billion Share of total foreign debt: 2.4% Starting off the list of our major foreign creditors is Russia, which holds about 2.4% of the U.S. debt pie that sits on the international dinner table. Its $106.2 billion in treasury securities is equivalent to the 2009 GDP of our sparsely populated North: The combined output of North Dakota ($31.9 billion), South Dakota ($38.3 billion) and Montana ($36 billion) matches up nicely with the Russian holdings, at $106.2 billion.
r u studying Cantonese as well? Are you taking classes, practicing with CDs, or just reading on your own?
Gut, gut! Dich goeten! Nope. I took three years of Mandarin Chinese, and still retained a good bit. But I'm slowly getting back to that since my friend (Chinese dude) wants me to collaborate on a Chinese-American newspaper business. He's writing articles for his friend in China, who works for a prominent Chinese newspaper. So, I get paid to basically assist in writing articles.
Nice topic BBW!!! I often wonder who thought about this same subject, especially after doing business with a lot of other cultures back in the day. Japan was most prosperous for me and second was China so far, but they never knew they were negotiating with a black man. Thank goodness for email and an Oriental partner!!
Yes it's bad but none of those nations individually hold a share of U.S. debt that is greater than 7% of our GDP. We currently have a $14.86 trillion dollar economy with China being our number one foreign lender at $891.6 billion. $891.6 billion is approximately 6% of our economy, with Japan holding roughly an equal percentage of U.S. bonds. The larger problem is the trade deficit we're running with China. Unlike Japan, China is not a nation of innovators. We do not purchase their cars, televisions, video game systems, because the quality of Chinese goods are generally below Japanese and western standards. Instead we've shipped our manufacturing jobs to China because the labor is cheap (for now), and double their return by purchasing Chinese made American goods domestically. Got wages?
THANK YOU for pointing that out to me. I probably repped the wrong people in the past....damn!!! You are honest and I appreciate that. THANK YOU. I repped UnChosen1 for that just now.
Hahaha, no worries man. I'm not one to take credit for other people's topics and ideas. I like to give them credit where credit is due.
The Federal Reserve Owns the most debt by far followed by private investors, not China. I don't trust the Fed anymore than those "foreign" debt holders.
Dave ramsey says if we apply the debt snow ball we will be out of debt in 100 years. we just need to live on beans and rice and rice and beans.
