🎯 The USA has 6.5 trillion in Bonds due by the end of June, is the USA facing bankruptcy? 🎯
📌 Recently, there has been widespread circulation online that the USA will face bankruptcy at the end of June, as up to 6.5 trillion in US Bonds are about to mature. Because many people disliked Trump due to the tariffs he imposed, this report went viral, causing many netizens to think that the USA is about to go bankrupt.
📌 There is a saying in the financial world called "too big to fail," which means that when you have borrowed to the extent that the whole world is your creditor, you don't need to worry about repayment, because the creditors will be more worried about you defaulting than you are.
📌 In fact, the USA's debt has already exceeded 100% of GDP, so the maturing debt each year is naturally very high. The national debt maturing in 2025 is actually similar to that in 2024. However, the USA usually pays off maturing debt by issuing new debt.
📌 The rumors about the USA possibly going bankrupt suddenly surfaced because recently, other countries were unhappy with Trump's erratic implementation of tariffs, leading to a collective sell-off of national debt, causing speculation that USA Bonds might collapse, as other countries no longer want to buy US Bonds.
📌 Although Japan and China are the largest overseas creditors of the USA, the proportion of government bonds they Hold is actually quite low. Japan holds about 1 trillion, which only accounts for 3% of the total US government bonds. In fact, foreign investors only account for 25% of US government bonds, while the remaining 75% is held by the USA itself, including the Federal Reserve, the federal government, and local Funds, such as Berkshire Hathaway Inc. led by Warren Buffett...