…and how it is distributed

Source: Z1 Flow of Funds, US Federal Reserve

There was $41.3Tn of US debt in 2016 compared to $26.8Tn in 2006 and $12.4Tn in 1996.

Instruments

In terms of instruments, in 2016 total US debt was split as follows: 38.7% was in US Treasuries (UST), 29.3% was in US Corporates (USC), 20.6% was in Government Sponsored Agencies (GSA), 9.3% was in Municipal Bonds (Munis) and 2.6% was in Open Market Paper (OMP)

Source: Z1 Flow of Funds, US Federal Reserve

US Treasuries issuance as a % of total reached its all-time low in 2008 at 20%; the high was 1945 at 86%. There was a drastic reduction is US Treasuries issuance in the 1990s as Clinton’s administration decided to eliminate the US budget deficit. US Treasuries issuance picked up significantly after the 2008 financial crisis and almost doubled as a % of total by 2016.

Source: Z1 Flow of Funds, US Federal Reserve

US corporate issuance, on the hand reached an all-time high in 2007 at 36%; the all-time low was 1945 at 9%. Between 1999 and 2010 there were more US corporates bonds issued than US Treasuries.

Source: Z1 Flow of Funds, US Federal Reserve

Sectors

In terms of sectors, the largest owner of US debt is the US financial domestic sector at almost 60% of total, followed by the Rest of the World (RoW) at 26%, and the US nonfinancial domestic sector at 14%. Both domestic sectors have declined at the expense of the foreign sector as globalization spread after the mid-1990s.

Source: Z1 Flow of Funds, US Federal Reserve

The biggest holder of US debt in 2016 were indeed foreigners, followed by mutual funds, banks and households. While foreigners’ holdings are close to an all-time high, both banks’ and households’ holdings of US debt are at an all-time low.

Between 2008 and 2016, Fed’s holdings increased by almost x10 (1.6% to 10.2%). The rest of the government’s holdings however halved from 9% to 4.5%. Households and banks both reduced their holdings while foreigners increased them.

Source: Z1 Flow of Funds, US Federal Reserve