National Debt hits another record $11 Trillion

I had earlier posted on my blog just as recently as in October 08 about the astonishing rate at which the national debt of US touched 10 Trillion and they had to bring a new digital counter to fit all those digits. Now just in six months.. here's the next one !

Now what does that mean ?
> Over $36,000 in debt for every man, woman and child in US.
> It took the U.S. government 191 years – from 1791 until 1982 – to run up its first trillion dollars in debt.
> By the time George W. Bush was inaugurated in 2001, the National Debt stood at $5.7-trillion. He ran up more debt faster than nearly all of his predecessors combined: just under $4.9-trillion. Also if you want teach your teen kids struggling with algebra on what a real-life example of "exponential" is, this could be your classic one !

> It's projected by Obama adminstration that by the end of September 2012, the Debt will have soared to $16.2-trillion – which amounts to nearly 100% of the projected Gross Domestic Product (GDP) that year.

Wonder what's the big deal ? Debt to whom ? should we be worried ? or who should worry ? Ofcourse, it is.. check it out here for some Debt 101 class ! .

Only interesting are some of the signs if you chose to observe :

> 3/13/2008 "Worried Debtors & Reassurances on Creditworthiness" : China, proably the single largest buyer of U.S. debt in recent times, now starting to get concerned about the safety of the estimated $1 trillion his country has invested in U.S. government debt! Chinese Premier Wen Jiabao said on Friday "We have lent a huge amount of money to the U.S., so of course we are concerned about the safety of our assets. Frankly speaking, I do have some worries," he said in response to a question. NYTimes Obama Reassures Countries on U.S. Debt

> Two days later, 3/16/08 : Bloomberg reports "Foreign Demand for Long-Term U.S. Assets Weakens". Quote from the article “There was a stampede by foreign investors to exit their U.S. dollar investments,” said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York. “Everyone wants to bring their money home. It’s not about return on capital. It’s whether you can get your capital back.”

The decline in foreign holdings was the steepest since August 2007. Foreign investors sold a net 43 billion dollars in long-term US securities in January as the flow of capital turned negative, US Treasury data showed Monday.

Analysts say a loss of confidence in US Treasury securities could cause a dramatic drop in the dollar and force Washington to pay higher interest rates.