Divest to who? Right now, both the Chinese and the Japanese are stuck with far more than a trillion dollars of US debt, and would like nothing better than to dump it. Except doing so would find few if any buyers, and crash the value of their paper assets.
“Divest to who? Right now, both the Chinese and the Japanese are stuck with far more than a trillion dollars of US debt, and would like nothing better than to dump it. Except doing so would find few if any buyers, and crash the value of their paper assets.”
The Chinese and Japanese are pretty much trapped for the reasons you mentioned, but they sure aren’t forced to buy more. Smaller holders and investors aren’t trapped at all. The treasury is constantly selling new debt. To quote James Carville: “God****, whoever the bond market is, these b*****ds are powerful.”
Your idea is a very dangerous one.