Monday, December 3, 2007

U.S. government debt soars

from The Associated Press

"The government is in the same predicament as the average homeowner who took out an adjustable mortgage," said Stanley Collender, a former congressional budget analyst and now managing director at Qorvis Communications, a business consulting firm ... For now, large U.S. trade deficits with much of the rest of the world work in favor of continued foreign investment in Treasuries and dollar-denominated securities. After all, the vast sums Americans pay -- in dollars -- for imported goods has to go somewhere. But that dynamic could change. "The first day the Chinese or the Japanese or the Saudis say, 'We've bought enough of your paper,' then the debt -- whatever level it is at that point -- becomes unmanageable," said Collender.

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