U.S. Debt

I recently ran across a statement by legendary investor Sir John Templeton where (according to Sir John):

"...the dollar will lose 40 percent of its value against foreign currencies in the coming months, especially the Japanese Yen and Chinese Yuan. This depreciation will cause the Chinese and Japanese, who own 36 percent of all U.S. foreign debt, to sell their bonds ...

>Yeah, so?
Well, I figured I should check with the U.S. Treasury etc. to see how bad it was and ...

>Yeah, so?
Well, it seems that foreign-owned U.S. Treasuries keep going up and are about 40% of the total, as of June, 2003.

>So will the U.S. dollar go down?
I have no idea, but it hasn't done too well over the past couple of years against many currencies:

>So what do you suggest?
>But if it's small compared to the U.S. GDP then why worry?
But it's 40% of all government treasuries! Isn't that scary?

Okay, okay, here's how the foreign-owned treasuries have changed - as a percentage of U.S. GDP (about 10.8 trillion, in April/03):

>The percentage went down in the late 90s, eh?
When the U.S. market went up, eh?

>You're talking foreign-owned treasuries. What about total U.S. debt?
Total Debt runs about $6,500,000,000,000 (April/03) and ...

That's 6.5 trillion, so it's 6.5/10.8 or about 60% of GDP.

See also U.S. Debt stuff

The total national debt can also include such things as personal mortgages, bank loans etc.
... in which case the total debt is significantly larger (compared to GDP)  

See federalreserve.gov.

>And what about the deficit?
... nearing 600 billion: