As a reminder, check out this great chart from Société Générale showing who holds US Trasury debt. In the unlikely — thought increasingly possible — event of an unscheduled water landing failure to raise the debt ceiling, a technical default would be avoided by making the payments on these bonds:

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click for larger graphic

Source: Global Insight, SG Cross Asset Research/Economics

Category: Credit, Taxes and Policy

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

20 Responses to “Who Owns Treasury Debt?”

  1. ilsm says:

    This is the privately held US debt!!

    SS is about $2.6T of over $4.3T in intragovernment instruments.

    Treasury normally places around $15B (no cash transaction) a month into OPM, Military retirement and military medical accounts which have been held back since May 11.

    That is ignoring appropriations, which is the model for next week……………………………………….

  2. falconized says:

    Hmmm…how about a selective default. We won’t pay interest on the debt held by the Federal Reserve since it just goes back to the Treasury anyway? Isn’t that what QE amounts to? Being able to make additional debt by the Treasury to fund government AND avoid the interest expense?

  3. theexpertisin says:

    Thanks for this post.

    I was mildly suprised at the relatively small amount held by insurance companies and business.

  4. Petey Wheatstraw says:

    “ . . . a technical default would be avoided by making the payments on these bonds . . . ”

    Is that anything like a technical foul in B’ball? Seems to me, we’ve been walking, carrying, traveling, double dribbling, charging, and goal tending, while League Officials pay the Ref to look the other way.

    Actually, professional basketball has more credibility when it comes to following the rules.

    If we thought wars of choice, hubris on the world stage, and poisoning the world’s financial systems were bad PR, this recent peek into the real dysfunction of our government leaves our reputation in tatters.

    As a technicality, it already doesn’t matter if we pass the debt limit, or not.

  5. beaufou says:

    I actually found this, this morning.

    “Many people — politicians and pundits alike — prattle on that China and, to a lesser extent Japan, own most of America’s $14.3 trillion in government debt.

    But there’s one little problem with that conventional wisdom: it’s just not true. While the Chinese, Japanese and plenty of other foreigners own substantial amounts, it’s really Americans who hold most of America’s debt.

    Here’s a quick and fascinating breakdown by total amount held and percentage of total U.S. debt, according to Business Insider:

    Hong Kong: $121.9 billion (0.9 percent)
    Caribbean banking centers: $148.3 (1 percent)
    Taiwan: $153.4 billion (1.1 percent)
    Brazil: $211.4 billion (1.5 percent)
    Oil exporting countries: $229.8 billion (1.6 percent)
    Mutual funds: $300.5 billion (2 percent)
    Commercial banks: $301.8 billion (2.1 percent)
    State, local and federal retirement funds: $320.9 billion (2.2 percent)
    Money market mutual funds: $337.7 billion (2.4 percent)
    United Kingdom: $346.5 billion (2.4 percent)
    Private pension funds: $504.7 billion (3.5 percent)
    State and local governments: $506.1 billion (3.5 percent)
    Japan: $912.4 billion (6.4 percent)
    U.S. households: $959.4 billion (6.6 percent)
    China: $1.16 trillion (8 percent)
    The U.S. Treasury: $1.63 trillion (11.3 percent)
    Social Security trust fund: $2.67 trillion (19 percent)

    So America owes foreigners about $4.5 trillion in debt. But America owes America $9.8 trillion. “

  6. FS says:

    Unscheduled water landing.
    Nice!

    Time to cut spending people, let’s stop the whining, posturing, demonizing and make an effective government,
    not a tyrannical monster.

  7. DebbieSmith says:

    One of the biggest concerns that Washington should have is the interest owing on the current debt not just on creating the new debt floor. As shown in this article, should interest rates rise to 7 percent, interest payments on the debt alone could reach 136 percent of GDP in the next 70 years:

    http://viableopposition.blogspot.com/2011/01/interesting-look-at-interest-on-us-debt.html

    It appears that interest owing on the debt for this fiscal year will reach a new record level above $450 billion, more than what is spent on Medicaid.

  8. davossherman@gmail.com says:

    Who owns the debt???????????

    You and I and 308 million Americans own the DEBT.

    That is why the consumer, earning circa 1970s wages, hands over every cent made between January 1 and August 15th.

    Meanwhile the Fed jokes about off-shoring good jobs, the housing market crashing and whether the Democrats or the Republicans like to borrow more. Go to this link and do a CRL+F for [laughter] to read the 2005 key FOMC minutes http://www.financialsense.com/contributors/d-sherman-okst/tossing-the-consumer-under-the-bus

    NO CONSUMER = DEPRESSION

  9. Petey Wheatstraw says:

    “So America owes foreigners about $4.5 trillion in debt. But America owes America $9.8 trillion.”

    Y’know, it might be obvious I don’t really know any advanced economic theory, but it seems to me that a country who has such glaring debt shouldn’t have any billionaires.

    Honestly, as a matter of the control of our money supply — especially in light of the “all wealth comes from the private sector,” meme — how do we have citizens and non-citizen “persons,” (i.e., corporations), powerful enough to be effectively (and lately, openly), in control of the government and above the law, enriching themselves by taking a large cut of what they borrow in the name of the American people?

    The Forbes 400 is littered with people associated with banking and finance (see note), or other powerful industries that benefit directly from the government or by regulatory capture or lobbying influence. Healthcare, oil, real estate, retail giants (dual pipelines: labor out, products in), communications (via publicly granted airwaves and ROWs), pharmaceuticals, etc.). These are the same people who are responsible for our government debt. The same people who took us into a credit (debt)-based economy, including debt-based government financing, in the first place. They are the people who were supposed to provide jobs in return for tax cuts. The people TBTF.

    This is not free enterprise, it’s wealth transfer.

    Note: A large portion of the remainder of the list didn’t make their money on their core trade, they made it selling or trading stock (stocks, being lately and broadly, the ultimate beneficiaries of government largess), and other “exotic financial products,” of questionable value and which will someday blow up in our faces. Facebook is a prime and recent example (I’m sure many will dislike this sentiment, but they are also free to participate in making Mr. Zuckerberg the next new Prince — nothing against going along to get along).

  10. FS says:

    @ Petey

    Y’know, it might be obvious I don’t really know any advanced economic theory, but it seems to me that a country who has such glaring debt shouldn’t have any billionaires.

    Glaringly obvious, really. The debt has been run up by liberal (and conservative) politicians, any correlation to people who have been successful is fascist rhetoric. Success is not bad, misusing or not using your success is.

    Communism and Socialism are proven failures. Our Capitalist system needs some thought, some cultural repair,
    and a whole lot less liberal whining about how other people should support them.
    Capitalism, it rocks.

  11. beaufou says:

    “Glaringly obvious, really. The debt has been run up by liberal (and conservative) politicians, any correlation to people who have been successful is fascist rhetoric. Success is not bad, misusing or not using your success is.”

    Capitalism rocks, crony capitalism sucks and that’s what we have, as Petey mentioned, wealth transfer isn’t free enterprise.

  12. Petey Wheatstraw says:

    FS:

    In modern times, Fascism is also a proven failure. (Interesting note: I was driving past one of the buildings on the National Mall with my son, yesterday, and pointing out a couple of statues flanking the steps of a building (maybe the National Archives), the statues were seated classical figures, the one on the left, a bare-breasted woman holding a child in one hand and an urn in the other, and the one on the right a man holding a helmet in one hand, and a fascia in the other.

    Hmmmm . . . . .

    Our “capitalist system” was trashed by people calling themselves “conservatives,” but who, in reality, were actually the greatest group of swindlers the world has ever known.

    And you back them up.

    Nice.

    We pick and choose winners and losers and call our money into existence as debt. If you think that’s capitalism, you are a bit more glaringly obvious than I am.

    People looking for jobs are not whining for others to support them. The breach of social contract does not fall on them.

    And before you jump in on the “socialist” angle, please show me one functional government in the history of the world that did not, in one way or another, practice socialism (if you can, I’ll show you a hell-hole).

  13. DeDude says:

    Heck if that is the case then why don’t we create doubt about our national will to pay our bills. It will only cost about 100 billion more in interest/year or 1 trillion by the end of the 10 year period that all the savings are counted over. The final count will be 2.6 trillion in savings and 1 trillion in idiotic extra spending on interest (that would not have been needed if the national budget debate had been done during the budget process rather than during the “should-the-US-pay-its-bills” process). But who cares about wasting another trillion, as long as there is a tea-party going on.

  14. FS says:

    @Petey

    Our “capitalist system” was trashed by people calling themselves “conservatives,” but who, in reality, were actually the greatest group of swindlers the world has ever known. Ahhh, demagoguery, so early in the morning.

    This country’s path to ruin was set on course by liberal’s creating a sense and sensibility of entitlement, thrashing the work ethic, belittling honor, arguing for a culture of “anything goes” and then you bit#h when the “conservatives” took you at your word.

    The fact that our government now picks and chooses the winners is the legacy of the left, not the right. The legacy of the failed social contract is because you argued that the social contract didn’t exist, and not contributing anything was not only acceptable, but laudable.

    Just like your community organizer President, you won’t accept responsibility. Those on the right actually have,
    disowning Bush on Iraq ( a horrible choice ) and expanding government at such a rapid pace (coddling the lefty doo that inhabits our media and political arena.

    We are fixing ours, it’s time you step up.

  15. DeDude says:

    If y’all will take out huge add’s stating that Bush II was a failure; then we promise that we will also “fix” ours after he is done being the “decider” and have retired to a farm in Texas.

  16. Petey Wheatstraw says:

    FS:

    “The fact that our government now picks and chooses the winners is the legacy of the left, not the right.’

    You are full of shit.

    “This country’s path to ruin was set on course by liberal’s creating a sense and sensibility of entitlement, thrashing the work ethic, belittling honor, arguing for a culture of “anything goes” and then you bit#h when the “conservatives” took you at your word.”

    More shit.

    “Just like your community organizer President, you won’t accept responsibility. Those on the right actually have,
    disowning Bush on Iraq ( a horrible choice ) and expanding government at such a rapid pace (coddling the lefty doo that inhabits our media and political arena.”

    He is THE President, or OUR President, but he’s not MY President.

    Disown YOUR side back to Reagan, and you’re still full of shit.

    The Media and political arena are about as far right as they can be.

    I have always been responsible for myself. I have never been on the government tit in my life. Never collected unemployment, welfare, social security, held a government contract, a government job, or any other perk of citizenship that is available to some, so you should STFU.

    “We are fixing ours, it’s time you step up.”

    “We” and “ours?” Are you not an American, or do you mean the part of America that is just like YOU? The ones who vowed to destroy government? Those dickheads?

    The Republicans INVENTED borrow and spend, AND crony capitalism. Quit trying to put your flaming bag of crap on anyone else’s doorstep.

  17. mote says:

    “If I owe you a pound, I have a problem; but if I owe you a million, the problem is yours.”

    John Maynard Keynes

  18. blackjaquekerouac says:

    i hope you’re shorting “the complex” like all the rest then Barry. most people don’t believe in The Apocalypse…until it happens. Please don’t tell me “you have a body count by your name as well” cuz “those are VIP’s you’re targeting.” They have a License to Kill.

  19. [...] Big Picture blog has this great chart from Société Générale showing who holds US Treasury debt (see chart [...]