U.S. Fed Is Now Biggest Holder Of U.S. Gov't Debt!

Racing to fund the U.S. Government's mushrooming debt, the U.S. Fed is rapidly printing money and as of last month, now owns more debt than even China, formerly the U.S.'s biggest debt holder.

By June, when the U.S. Fed is scheduled to complete its latest stimulus program, all of the money printed out of thin air, it will own more U.S. Gov't debt than China and Japan, the next largest holder, combined!

The immediate effect is to hold down U.S. interest rates and flood the nation with money. But it is paving the way for interest rates to later skyrocket because global debt investors are learning what I have just told you and will likely demand a risk premium to buy U.S. debt. This will especially be so if prominent credit rating agencies such as Standard & Poor, which just downgraded Japan's debt, does the same with U.S. debt.

If you are an American, please take steps to protect yourself from the rampant inflation to come. If you must sell your home, consult your local real estate professional, but sell it now for higher mortgage rates will drive down values. If you are going to keep your home, consider putting a 30 year fixed rate mortgage at today's low rates on it. When inflation hits, you'll get a one time free ride. Also, pay off or pay down your credit card debt for unless you have a cap on how high those rates can rise, they will devour you in inflation.

If you think this can't happen here, recall that in 2008, almost no-one saw the financial crash coming, least of all the U.S. Fed and the U.S. Gov't. And as you watch the Egyptian Gov't crash, realize that Washington and Cairo were blindsided as to what was coming despite having extensive investigative organizations such as the C.I.A. Even though they are long in building, when these things happen, they happen fast!

Dick
For further financial details, please see the prominent British business newspaper, the Financial Times, "Fed passes China in Treasury holdings." http://www.ft.com/cms/s/0/120372fc-2e48-11e0-8733-00144feabdc0.html#axzz1Cpsyx3OB