Thursday, July 21, 2005

Debt Held By Foreigners

The Skeptical Optimist asks "What's so scary about 'Debt held by foreigners'?"
Anyone who is kept awake nights by the fact that China owns a large amount of America's debt (readers of Paul Krugman for example) would be well-served to read it. Excerpt:
I'm sorry, I don't buy the scary, emotional rhetoric. Why? Because I am one of an apparent minority who is not just happy-but delighted-that foreign investors with dollars to spare think the USA is the one of the safest, most stable places in the world to invest their money.
On the other hand, Econbrowser offers a rebuttal here. Excerpt:
[W]e're basically further impoverishing the Americans of the future with each years' asset sell-offs or debt accumulation. If you don't find that scary, at least it seems to me a little sad.