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Feds are buying 61% of new US debt


Obama is still borrowing Trillions of dollars. However, the Chinese and many other countries have stopped lending. 61% of all new US bonds are being bought by the Federal Reserve with money that was created out of thin air. In other words, 61% of all the money that Obama is now borrowing is being printed with nothing to back it. Each dollar printed devalues the existing dollars in circulation. Taxpayers must then pay more in taxes to cover the new debt.

From Money News…

The Federal Reserve is propping up the entire U.S. economy by buying 61 percent of the government debt issued by the Treasury Department, a trend that cannot last, Lawrence Goodman, a former Treasury official and current president of the Center for Financial Stability, writes in a Wall Street Journal opinion article published Wednesday.

“Last year the Fed purchased a stunning 61 percent of the total net Treasury issuance, up from negligible amounts prior to the 2008 financial crisis,” Goodman writes.

Goodman also warns that U.S. economy and markets are “at risk for a sharp correction” if conditions aren’t “normalized.”

“This not only creates the false appearance of limitless demand for U.S. debt but also blunts any sense of urgency to reduce supersized budget deficits.”