"The U.S. is borrowing so much that it may have

[I AM NOT THAT GUY 5,715]

"This mountain of supply isn't going to go away any time soon," said Kevin Flanagan, a Purchase, New York-based fixed- income strategist for Morgan Stanley's individual-investor clients. "If Obama or Congress cannot offset some of the spending with tax increases, or in cutting back on other spending, then the difference has to be made up with Treasury issuance."

The government sold a record $94 billion of notes this week.

"The biggest difficulties will be in the next few seven- year auctions," said William O'Donnell, a U.S. government bond strategist at UBS Securities LLC in Stamford, Connecticut, one of the 16 primary dealers required to bid at Treasury auctions. "We're going to get a very hefty slug of supply. As the saying goes, if you miss an auction this week, you'll get another auction next week. It never ends."

Possibility of Default

The U.S. is borrowing so much that it may have trouble paying the money back, said Jaemin Cheong, a bond trader in Seoul at Industrial Bank of Korea, the nation's largest lender to small- and mid-sized companies.

"Yields are headed higher," Cheong said in an interview. "More issuance will be needed to support the economy. The possibility of default is more and more as time passes."

The government is depending on overseas investors to help fund its $787 billion economic plan. China is the largest overseas holder of Treasuries, with $696.2 billion, followed by Japan, with $578.3 billion.

The administration forecast gross domestic product to shrink 1.2 percent in 2009, followed by 3.2 percent expansion in 2010. That's more optimistic than economists' estimates for a 2 percent contraction this year and 1.8 percent growth next year, according to the median forecast in a Bloomberg News survey.

China's top banking regulator said today the country will pay attention to safety, liquidity and profitability when deciding whether to buy more U.S. debt.

"How much we will invest in U.S. Treasuries will depend on the three elements," said China Banking Regulatory Commission Chairman Liu Mingkang at a press conference in Beijing.

http://www.bloomberg.com/apps/news?pid=206...refer=worldwide

[Jasman0717 9]

Ah sucks, the Feds can just print more money

[JODO 2]

We are Americans. We are not quitters and we always work hard. I would never bet against our country, so I don't worry myself with the details. Let Chairman Mao worry. For me, I'm made in the shade.

[I AM NOT THAT GUY 5,715]

Ah sucks, the Feds can just print more money

The scary part of the story is that even China is having second thoughts about buying US Treasury bonds. The US used to have the best paper in the world, sorta like California did, before Gray Davis.

Edited February 27, 2009 by Mister_Bill

[Jasman0717 9]

Ah sucks, the Feds can just print more money

The scary part of the story is that even China is having second thoughts about buying US Treasury bonds. The US used to have the best paper in the world, sorta like California did, before Gray Davis.

California 'WAS' the land of milk and honey