Wednesday, January 7, 2015

Who Owns US Treasury Securities?

 50% is held by foreigners and 20% is held by the Fed. Domestic accounts hold only 30% of Treasuries, down from 75% in the early 1990s,

This is a very unstable situation.

(via Ritholz)


  1. Of the "foreigners," I'm curious to see what proportion is held by central banks. The Bank of Japan has been on an unprecedented buying spree since the Fed "stopped."

  2. I wonder what happens if Japan's currency busts and one of the few things they have left of "value" is decreasing value US bonds....

  3. Could the problem be solved by changing the tax code? What would happen if the 401K/IRA rules were changed to require all account holders to have a minimum % of the account in US Treasuries?


    1. I can't speak for everyone else, but I would not want to be "required" to hold any US bonds. When things fall apart, I don't want to be anywhere near those.

    2. @ Michael

      Anon @ 5:51 has brought up something I've read on before....the Japanese gov't did that exact thing, mandating it's own population subsidize it's deficits/monetization by requiring their savings fund Japanese bank bonds....

      So unfortunately there's precedence...I think the US gov't will do whatever it takes to try to prevent(unsuccessfully) the proverbial wheels from coming off the cart.

      The US gov't has no problem with theft/ a requirement that 401K money be diverted to US bonds at the height of some kind of fiscal meltdown wouldn't surprise me one bit...or a Euro style "bail in", which RW alluded to on his post the other week about legislation being passed classifying US bank account dollars becoming part of the investment bank pool of available funds....

      There are so many ways for the US gov't to screw us you can't count them all and they have no reason to not do it up to this point it seems as no one is breaking out the pitchforks(yet).