Remember last week when I asked why people didn't care about things like the declining dollar? I couldn't believe folks weren't paying attention. Well guess what? People were paying attention, it just wasn't us, it was them. Them as in our creditors.
Paul Kedrosky points out that foreigners were big sellers in August.
You can find the full report here. Go to the August column, look halfway down and you see the -$85M on line 21. That is the net foreign outflows from the U.S. That means foreigners sold $85B worth of our securities. Now August was a terrible month with the mortgage market getting hit but instead of investors and banks taking their medicine, they tried to arrange bullsh*t bailouts like these: Big Banks Push $100 Billion Plan To Avert Crunch
Now, $85B in the grand scheme of things is nothing. It's not even a drop in the bucket, but it's an indication of where things could go.
Folks, a currency that is getting crushed and bankers begging for bailouts is not a recipe for continued financial health.