It appears that China (and other countries) are slowing up on their purchased of U.S. securities. It has been thought that this would occur, but it is still not going to be declared a total defeat for the seller (aka U.S.A.) for some time.

It is important for the Treasury to keep up the image that there is “no problem here” and will do all they can to continue to work on issuing more and more debt in order to pay for the enormous spending spree that has gone on.

There is one thing to consider though…. The Fed will try every trick in the book in order to keep rates down. This is the best interest of the national debt since higher interest means higher debt service. Unfortunately, they speak with both sides of their mouths as interest rates are being kept artificially low, no inflation is present, but recovery is moving forward.

One of the above doesn’t belong….

• January Net Long-term TIC Flows $19.1 bln vs $47.5 bln, prior 63.3 bln