Asian debt withdrawal threat to US deficit

[cthrumatrix]

Asian debt withdrawal threat to US deficit
By Jenny Wiggins in New York
Published: September 7 2003 19:01 | Last Updated: September 7 2003 19:01


Economists fear that Asian investors, who are the largest foreign owners of US Treasuries, may cut their holdings of US government debt, withdrawing a key source of financing for America's large current account deficit.


The worries have been fuelled by recent sharp falls in the price of US government debt.

Weakness in the US Treasury market could make Asian investors "less willing" buyers of debt securities, said Marcel Kasumovich, head of G10 foreign exchange strategy at Merrill Lynch.

He said there had already been a "noticeable shift" downwards in the amount of debt issued by mortgage financiers Freddie Mac and Fannie Mae being bought by foreign investors.

Asian investors have piled into the US Treasury markets in recent years, helping to push Treasury prices high and interest rates low. China, Japan, South Korea and Hong Kong owned a combined total of about $696bn in Treasuries at the end of June, up from $512bn in December 2001, according to data from the US Treasury.

http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/FullStory&c=StoryFT&cid=1059479617509&p=1012571727085

This is something to watch team. Asia buys alot of debt. If they were to curtial or stop....watch the market and rates.

[midnitemoleman]

1. All part of the Bush plan I bet.

Make America go to war over money owed. Remember the Bush goal:World Domination.

[salin]

2. I just ran across a related item - predicting more bad news for

the bonds market.

[bahrbearian]

3. Oh shit I was hoping to Refiance once again..

Currently holding a $250,000 morgage with -120% equity, $5000 visa, $3000 Master card, $650 lease payment for my Landrover, $3000 a month income and $700 child support. Now what do I do???

[rfranklin]

5. Sell the house, buy a Hundyai, pay off your bills...

rent an apartment and turn your remaining cash into gold. You will be a rich man in a few years.

[demdave]

6. Refinancing is not the answer.

When you are in a hole stop digging. You are bankrupt and just don't know it. A $650 lease on a landrover? Were you planning a safari across the desert? Take the hit and file bankruptcy. You are not in over your head, you are at the bottom of the lake in a bucket of cement.

[bahrbearian]

9. - 120% equity -120%

That's minus 120% equity

[Jackpine Radical]

7. You're kidding, right?

Please tell me this is a joke. Nobody really does that to themselves, do they?

[bahrbearian]

8. This is from my Young Repug co-worker

The one climbing the company ladder on my back. Little back stabber? CAN'T WAIT FOR THE SHIT TO HIT THE FAN..

[Skittles]

10. lots of people live WAY beyond their means

it's quite common

[Kenneth ken]

11. ok - so this is a young repub

and not you?

Doe he have a wife? If so, he will need to start pimping her out as her 2nd job. Otherwise, stick a fork in him/them.

Re-Fi would only put his mortgage at about -125% equity.


Walk away from the house, and move into the Landrover?

[Jackpine Radical]

12. Hope she's at least cute.

"Doe he have a wife? If so, he will need to start pimping her out as her 2nd job."

[NNN0LHI]

4. The domino's just keep on falling n/t

[JNelson6563]

13. hope you don't mind

I'm posting this in the Stock Watch Thread. Good catch on this!

Julie

[denverbill]

14. This is what happens when you mortgage your future for tax cuts.

It's only a matter of time.

If Asians stop buying US debt, we have to keep selling it somehow. The only way to do that is to raise interest rates. So, we've got a record deficit, record debt, a stagnant economy, and now, let's throw rising interest rates into the mix and see what happens.

But, hey, don't think about the future. Live for today. Throw caution to the wind. Gimme my money back. It's my money!! We'll asshole, it's your goddamned debt too and your goddamned war on terra.

[PROGRESSIVE1]

15. We're in BIG TIME Trouble!!!

My Fellow DUer's should remember to thank the President for all of this!

(Satire)