Foreign holdings of US Treasuries hit new records as debt skyrockets

As the government debt continues to rise by the second, foreign holdings on US Treasuries have hit new record highs. This comes after five straight months of increases. According to the February report, holdings totaled $7.96 trillion, up from 7.94 trillion in January, with treasuries owned by foreigners rising 8.7 percent from last year.

All of that might sound confusing and hard to understand, and that is kind of the point. Banks do not want you to understand the ins and outs of financial dealings so they can run off with more money. So, what does this foreign holding mean?

Economist EJ Antoni says this has come about as a result of the treasury borrowing insane amounts of money with not enough people able to lend it.

"They are having to go to foreigners and the only way to entice them to buy more debt is to offer higher yields," he says. "The US has never had this problem before...as they continue offering higher yields, more foreigners are buying that debt."

The countries buying most of our debt are Belgium, which has holdings totaling $310 billion. Japan however holds the largest amount at $1.167 trillion. That is the largest amount they have held since August of 2022.

We have managed to entice Japan into buying this insane number of holdings with these incredible yields, but Antoni says that is not always a good thing.

"The problem is that as we continue offering this, the interest expense on the debt is going through the roof," he says. "It is already over one trillion a year and is rising fast."

Each taxpayer in the United States technically holds a debt of $266,951 at the time of this article. The national debt continues rising about $1 trillion every 100 days.

The more it continues to climb, the further into a death spiral we fall.

"More and more of what we pay in taxes is going to paying interest on the debt...and increasingly, it is foreigners, because they are the only ones who have any money left to buy the debt," he says.

The 10-year Treasury yield started February at 3.86 percent and ended the month at 4.25 percent. It will likely continue creeping up, as the debt continues blasting into the stratosphere.

But the breaking point is not far off.

"Unsustainable is the word here...we are already at a point where over half of personal income taxes are consumed just on paying interest on the debt," he says. "It is getting worse on a monthly basis, too."

In addition, foreign buying of U.S. corporates and agencies continued in February, with inflows of a combined $56.4 billion.