The amount of U.S. debt owned by foreign nations has never been higher.
Since Sept. 30, 2014, the U.S. Treasury has accumulated $17.8 trillion worth of debt. That's roughly 103% of the total U.S. GDP in 2014.
And 34% of that debt - $6.1 trillion - is owned by foreign governments.
China is the largest holder of U.S. debt. At the end of March, the Treasury Department announced that China owned $1.261 trillion worth of U.S. government securities. That's more than 20% of the U.S. total foreign debt.
That means China now holds the power to drastically impact interest rates in the United States.
You see, the problem arises when countries like China start dumping that debt.
According to the Council on Foreign Relations (a non-partisan think tank), "A foreign sell-off of U.S. securities could drive up U.S. interest rates and render the nation's formidable stock of debt far more expensive to service... No one knows in advance when the tipping point will be reached, but the damage brought about by higher interest rates and slower economic growth will be readily apparent afterward."
We've seen China exercise this power before. During the last six months of 2014, China dumped more than $75 billion worth of U.S. bonds.
What China will do with our debt is such a major concern that the CIA's Asymmetric Threat Advisor Jim Rickards has just released a warning for all Americans...
"The foreigners are now dumping Treasuries and if no one buys it, guess what, interest rates go up," Rickards said. "That'll sink the stock market, that'll sink the housing market. Higher interest rates mean the debt gets higher, so interest rates go up some more."
With these actions, China has taken direct aim at the U.S. dollar. And that's just one of the ways China is engaging in financial warfare against the United States.
This is just one of five "flashpoints" that will trigger the U.S. dollar's demise. Some of the others are already happening. Continue here to get all the dollar-ending catalysts today...
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