Economic Collapse: Growing Trend Should Terrify Americans Everywhere

Is the U.S. on the Verge of anEconomic Collapse?

Foreign governments are accelerating sales of U.S. debt they hold, a fresh signal that a U.S. economic collapse is coming soon. Foreign holdings of U.S. Treasury debt and other notes have dropped to $6.18 trillion in January 2016, down from $6.22 trillion in January 2015.

According to figures released this week, foreign central banks and government institutions sold $57.2 billion of U.S. Treasury debt and other notes in January, up from $48.0 billion in December. That is the highest monthly tally on record, with said records going back to 1978. Last year, foreign central banks dumped a record $225.0 billion of U.S. debt.

Foreign governments are selling their U.S. holdings mainly because they are raising cash to stimulate their own economies in the wake of the global growth slowdown and the continuing crash in oil prices.

China, the largest owner of U.S. debt, trimmed its Treasury holdings by $8.2 billion to $1,237.9 billion in January from $1,246.1 billion in December, according to the Treasury Department figures. The world’s second-largest economy has been liquidating its holdings of foreign debt to pump money into its slowing economy, plummeting currency and extremely volatile stock market. 

Norway lowered its holdings from $69.1 billion in December to $68.1 billion in January and Mexico dropped its U.S. holdings to $69.9 billion in the first month of this year from $72.2 billion in the last month of last year. Canada and Colombia also cut their Treasury holdings in January.

All four of these countries are exposed to the oil price crash and needed the cash to fill big holes in their budget. Oil had reached $26.00 per barrel in January, the cheapest price in several years.

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