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November 28, 2018
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I follow Bill Mitchell and as a result of that I believe that Treasuries do not fund Congressional spending. They are irrelevant to Congressional spending, in fact. Anyway, this particular blog, in my humble opinion, misleads the reader and reinforces the veil that somehow the federal fiscal statement is just like our family budget. The federal government’s fiscal statement of expenditures and receipts cannot break down or get sick. It is simply a record of dollars spent into existence and dollars taxed out of existence. It is impossible for a government to borrow its own currency. When the central bank sells Treasuries in exchange for reserves, it is merely swapping one non-government sector asset for another. Reserves get converted into bonds of equivalent value. Bond issuance is a portfolio reshuffle for the non-government sector. It does not net add financial wealth to the non-government sector.

In reply to Jose Oyola: Data on net foreign purchases of U.S. Treasury securities are published in table 7 of the International Transactions data release from the Bureau of Economic Analysis. Data through the second quarter show that the pace of these purchases is down in the first half of 2018 relative to the first half of 2017. Foreign investors will continue to buy these securities and may well pick up the rate of purchases going forward. The point of the blog was that the substantial jump in the fiscal deficit has so far not caused the U.S. economy, as a whole, to borrow from foreign investors at a faster pace than it was before the tax cut. https://www.bea.gov/data/intl-trade-investment/international-transactions

What in the world is “Government Savings”? The Government literally owns the printing press for US Dollars. The government can spend or not spend. It doesn’t need an investment or savings account. How are they “saving” money?

How do you reconcile the national stats in this article with the UST data on foreign ownership disclosed in https://www.whitehouse.gov/wp-content/uploads/2018/02/ap_4_borrowing-fy2019.pdf

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