Foreign investors own 25% of our external debt. This is a problem.
From
United States public debt - Wikipedia, the free encyclopedia
". . .the U.S. Treasury statistics indicate that, at the end of 2006, foreigners held 44% of federal debt
held by the public.
[36] About 66% of that 44% was held by the
central banks of other countries, in particular the central banks of
Japan and
China. In total, lenders from Japan and China held 47% of the foreign-owned debt.
[37] This exposure to potential financial or political
risk should foreign banks stop buying Treasury securities or start selling them heavily was addressed in a recent report issued by the Bank of International Settlements which stated, 'Foreign investors in U.S. dollar assets have seen big losses measured in dollars, and still bigger ones measured in their own currency. While unlikely, indeed highly improbable for public sector investors, a sudden rush for the exits cannot be ruled out completely.'"
A sudden rush for the exits. There is the doomsday scenario that Paulson, et al., do not dare to mention for fear that it's already happening.