12/18/25 What Else is Keeping Me Thinking at 2 a.m.?

Part 2 of 2 I mentioned that, all combined, globally, nations have a mind-boggling $337 trln in debt. That means that what one country does impacts the others, particularly if that country is the US, holding over $38 trln, soon to be $39 trln, of it. 3.3 billion people live in countries that now spend more on interest on their debt than on health care and education. The US Treasury says that the Cayman Islands holds $400 bln in US securities but the Fed calculates this differently and has a much different number for the Caymans of $1.4 trillion which would exceed the amount held by Japan. The Cayman Islands are used by hedge funds who are huge holders of the US debt. I would consider hedge funds to be “hot money” that could bail on us. That amount of US debt held by hedge funds is a concerning risk to the Fed. Japan is the official largest holder of US Treasuries, according to the Treasury at $1.1 trillion. A significant amount of these Japanese holdings is tied up in what they call a “carry trade”. The Japanese Fed bought its way out of the Japan’s 1990s meltdown with…

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