Decisions About Money and Controversial Commentary!: "You Have To Be Nice To Whoever Lends You Money, Don't You?"

Tuesday, May 25, 2010

"You Have To Be Nice To Whoever Lends You Money, Don't You?"

When I was a boy, I looked forward to receiving my allowance each Saturday morning. That was a long time ago, probably around 1957 or 1958, and I didn't get much money each week, something like 15 or 25 cents, I think it was. Still, it was a lot of money to me then, and I had no other source of money, except an occasional bottle return prize of two cents; they refilled soda bottles at the time, and finding one meant a guaranteed trip to the candy store. I also kept an eye to the ground anywhere I walked, looking for lost pennies. Back then I learned to be on my *best behavior* the day before and all during the day that my allowance was paid to me. I couldn't afford to miss collecting this money, or have the amount reduced or the payment delayed. Money was important to me then, I had my needs-candy, popsicles, soda, marbles, comic books, things little boys wanted, etc.

In those days I never owed any money to banks, so whatever I "earned" was mine to spend. I didn't have to pay any interest to lenders, but I would have gladly borrowed money from anyone if the opportunity presented itself--it never did, fortunately. My reputation as a trustworthy kid was already questionable, too! Of course, I didn't realize how different things would be when I grew up. As a young adult I amassed debt at a frantic pace, until I was buried in installment obligations like great numbers of other Americans. But, that's another story altogether.

"My Country 'tis of Thee"
Remember these words? They remind us that America belongs to each one of us, and to all of us at the same time. "Sweet Land of Liberty" (from the same song) If liberty refers to freedom, it's not freedom from debt, that is for sure. "My Country" owes about 13 trillion dollars, which is the amount of the National Debt.
Just click right here to see the National Debt Clock "live". It will show you how much we owe, right up to the minute. It's probably one of the most enlightening things you'll ever lay eyes upon!

Do you ever wonder how America came to owe this thirteen trillion dollars, and to whom the money is owed? Wonder how we borrowed most of the money? I will explain some of it to you!

The United States Treasury sells bonds, which are debt obligations, to anyone who wants to buy them. The treasury bonds, notes, or bills,whatever you want to call them pay very low interest, but they are generally regarded as the safest loans that can be made. So investors (lenders, really) are inclined to buy them, when they have a lot of cash to invest (lend). They'll never get rich lending money to the US Government this way, but they do it....

OK now, so the United States owes thirteen trillion dollars, and a lot of it is from borrowing money from big investors, other countries specifically, countries which have purchased heavy amounts of Treasury Notes from the US Government. Here are the top 5 holders of US Treasury Notes:

1. China holds $895 Billion Dollars worth.
2. Japan holds $785 Billion Dollars worth.
3. United Kingdom $279 Billion Dollars worth.
4. OPEC, the Organization of Petroleum Exporting Countries, holds $230 Billion Dollars worth!
5. Brazil holds $164 Billion Dollars worth.