Every so often it’s a good idea to check who owns America.
While the Middle East spends about $15 billion annually on foreign investment, that is spread out between Paris, London and New York – predominantly. And while this may sound like a lot, it is projected to rise considerably as oil prices continue to lag and the money looks for alternate places to build wealth.
But that’s just a fraction of the true picture. US debt owned by foreign investors is not a new phenomena, it only becomes fearsome when the percentage begins to leave US internal investment in the proverbial dust… The greatest foreign investment continues to be held by – Japan at over $900 billion as of 2011.
As of 2011, America owned foreign investors $4.5 trillion in debt and Americans owed America $9.8 trillion in debt, which translates to a foreign ownership of about 31.5%.
Nothing to sneeze at. Nearly a third of America is owned by foreigners.
When it comes to real estate, the Chinese still lead the pack with the most foreign ownership. In just one quarter of 2015, Chinese real estate investment topped nearly $2 billion. They are followed by South Korea, United Arab Emirates, and Canada. And the top three markets have been the US, the UK and Australia. Anglo country.
The markets being tapped are not just housing real estate, but have exploded with office and commercial real estate as well as equities, treasuries, agencies and corporate bonds.
But this is just the crumb of information, the true fear is in Net Foreign Investment. “The U.S. net international investment position at the end of the second quarter of 2015 was -$6,688.3 billion (preliminary) as the value of U.S. liabilities exceeded the value of U.S. assets (chart 1, table 1). At the end of the first quarter, the net investment position was -$6,801.4 billion (revised).”
For the unlearned, the number translates to 6 trillion 804 billion. In the hole. In case you don’t get it, this is NOT good.
And these are the numbers released by the Department of Commerce. Who knows how accurate they are given they come from the government, it may be safe to say that they represent maybe 75% of the true number… BUt we can safely assume, that in either case, it is not a good number…
In their statistic, the US is nearly $7 trillion in the hole. Baddaboom!
The countries with the best statistic were Japan and Canada. But the statistics vary depending on what you are looking for. For example, Hong Kong came out on top when the parameters were Net Investment Position as a percentage of GDP. Using that same parameter, Iceland, Greece, Iceland Cyprus and Portugal came in last. Don’t like this record. Does not bode well.
AND this represents what has occurred in just the last … few… years, interestingly beginning in – 2008.
A steady, straight, crash.
BY comparison, the EU showed a surplus in excess of 212 ½ million Euros. China’s was an astounding $1.97 trillion – surplus! YES! As much as we vilify the country we could perhaps learn a few … Canada has a surplus of $231.7 billion, and while this is good for Canada, this is panning out really, really bad for the US.
To put some perspective to the number, Nigeria has a better structure than we do. As do Russia, Argentina, Venezuela and India. There is an adage, “If it ain’t broke don’t fix it.” I think the US might fit the alternate universe, “It’s broke, so you better damn fix it!”
And obviously the tactics that have been in place since 2008, in which we saw a continual plunge into poverty, is perhaps, maybe, not the right course of action…just a thought…
I don’t curse, but expletives are coursing my tongue right about now. How dare we put our country into this position! What the frickin…?
How dare we hide this information! How dare we manipulate the American people to such an extent that this would be considered the most devastating Ponzi scheme in the history of mankind! I imagine those that orchestrated this ‘shift’, are laughing hysterically at our absolute idiocy in accepting this – like sheep.
Just sayin’…