Just about everyone, of course.
When people say “Japan” or “China” “holds” a portion of the debt, do they mean the actual states themselves, or Japanese and Chinese nationals, or Japanese and Chinese banks, or all of the above? (I do imagine that these are not necessarily discrete categories, especially with what I hear is China’s form of “state capitalism,” but there is too little I know about all that.)
I’m only guessing, but I think it is all of the above. Otherwise it would have to be broken down more, since we do know that individuals, firms and governments all buy them.
I don’t have the data, but I would expect China’s to be largely central bank holdings while Japan’s holdings would be distributed more broadly as it’s a much wealthier country with a very different currency policy. Interesting question, though.
There’s probably a difference between what people mean when they say China holds US debt and what the actual case is. After all most people who mention the concept seem to imagine some kind of inter-government overdraft where the Chinese Government can simply cut off the ability of the US to pay bills.
That’s my sense, too.
You’re definitely right about that. They seem to view China as some sort of loan shark that can call in our debt and break our legs if we don’t pay them trillions of dollars in cash. There’s also a widespread belief that China owns the majority of our debt–also obviously not true.
I seem to remember the same sorts of nonsense about Japan back when Japan was the rising economic power. Now that they’re just a regular grown up economic power, nobody seems scared of them or their US bond holdings now. This despite the fact that they hold almost as much as China and, IIRC, held more than China during some periods over the past few years.
A chinese loan shark will not break your legs (at least not at first). He will instead splash pigs blood on your door way and paint something like “Owe $$$ Pay $$$” on your walls and your neighbour’s walls as well.
It’s so good to have a local expert on Chinese loan sharking…
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