definition
national debt
national debt
[1] is the main form of national credit. The central government often issues treasury bonds to make up the national fiscal deficit, or to raise funds for some expensive construction projects, some special economic policies and even wars. Because the national debt takes the tax revenue of the central government as the guarantee of repayment of principal and interest, it has low risk, strong liquidity and lower interest rate than other bonds.
classify
China's national debt refers to the national debt issued by the Ministry of Finance on behalf of the central government. Guaranteed by the national financial reputation, the credibility is extremely high. It has always been called "Phnom Penh bond", and cautious investors like to invest in government bonds. There are three kinds of bonds: voucher bonds, physical bonds and book-entry bonds. Edit the main features of this paragraph.
National debt is a special form of debt, which has the following characteristics compared with the general creditor-debtor relationship:
From the perspective of the subject of legal relationship
national debt
National bonds
Creditors can be citizens, legal persons or other organizations at home and abroad, the government of a country or region and international financial organizations, and debtors can only be countries.
Judging from the nature of legal relationship
The occurrence, change and elimination of the legal relationship of national debt mostly reflect the unilateral will of the state. Although the legal relationship of national debt is equal to other financial legal relationships, it shows a certain subordinate relationship compared with the general creditor-debtor relationship, which is more obvious in the legal relationship of domestic debt.
From the realization of legal relationship
National debt is the creditor-debtor relationship with the highest credit rating and the best security. Edit this paragraph for the purpose of issuing national debt.
The issuance of treasury bonds has the following purposes:
1. Issue war bonds to raise wartime military expenditure.
During the war, the amount of military expenditure was huge, and in the absence of other financing methods, funds were raised by issuing war bonds. Issuing war bonds is a common way for governments in wartime, and it is also the earliest origin of national debt.
2. In order to balance the national financial revenue and expenditure.
ordinary
national debt
Generally speaking, fiscal revenue and expenditure can be balanced by increasing taxes, issuing additional currency or issuing government bonds. Compared with the above three methods, it is a good way to increase taxes from the people, but the tax increase has certain limits. If the tax is too heavy and exceeds the affordability of enterprises and individuals, it will not be conducive to the development of production and will also affect future taxes. Issuing additional currency is the most convenient way, but it is also the least desirable, because using additional currency to make up the fiscal deficit will lead to serious inflation and the most serious impact on the economy. It is still a feasible measure to make up the fiscal deficit by issuing government bonds when it is difficult to increase taxes and issue additional currency. By issuing bonds, the government can absorb idle funds from units and individuals and help the country tide over financial difficulties. However, the circulation of deficit national debt must be moderate, otherwise it will also cause serious deflation.
3. The state issues construction bonds to raise construction funds.
country
national debt
The construction of infrastructure and public facilities requires a lot of medium and long-term funds. By issuing medium-and long-term treasury bonds, some short-term funds can be converted into medium-and long-term funds, which can be used to build large-scale national projects and promote economic development.
4. Repay the due national debt and issue bonds.
At the peak of debt repayment, in order to solve the problem of the source of funds for debt repayment, the state issues borrowed and exchanged treasury bonds to repay the old debts due. "This can reduce and disperse the country's debt service burden. Edit this paragraph classification
According to different standards, national debt can be divided into the following categories:
According to the different ways of borrowing debts.
According to the different ways of borrowing debts, national debt can be divided into national bonds and national loans. National bonds,
national debt
It is through the issuance of bonds to form the legal relationship of national debt. National debt is the main form of domestic debt, and the national debt issued in China mainly includes national debt, national economic construction bonds and national key construction bonds. State loan is a legal relationship between borrowers and borrowers through negotiation and signing agreements or contracts according to certain procedures and forms. National borrowing is the main form of national foreign debt, including loans from foreign governments, loans from international financial organizations and loans from international commercial organizations.
Depending on the repayment period
According to the different repayment periods, national debt can be divided into fixed-term national debt and indefinite national debt: it refers to the national debt with strict repayment period. According to the repayment period, fixed-term treasury bonds can be divided into short-term treasury bonds, medium-term treasury bonds and long-term treasury bonds. Short-term national debt usually refers to the national debt issued within 1 year, which is mainly used to adjust the temporary surplus and deficiency of the treasury's capital turnover, and the medium-term national debt with greater liquidity.
national debt
It refers to the national debt with a maturity of more than 1 year and less than 10 year (including 1 year but excluding 10 year). Because of its long repayment time, it can make the country use debt funds relatively stable. Long-term national debt refers to the national debt with a maturity of more than 10 years (including 10 years), which can make the government indefinite: refers to the national debt issued by the state without a specified repayment period. The holder of this national debt can get interest on schedule, but has no right to demand repayment of the debt. For example, the permanent national debt issued by Britain belongs to this category. According to the different issuing areas, national debt can be divided into domestic debt and national foreign debt. National debt refers to the national debt issued in China, and its creditors are mostly citizens, legal persons or other organizations, and the principal and interest are paid in their own currencies. National foreign debt: foreign debt refers to the general name of the principal and interest of various debts that residents of a country should repay to non-residents according to the contract. According to the Interim Provisions on Statistical Monitoring of Foreign Debt and the Detailed Rules for the Implementation of Statistical Monitoring of Foreign Debt issued by the State Administration of Foreign Exchange, China's foreign debt refers to all debts that organs, organizations, enterprises, institutions, financial institutions or other institutions in China undertake to repay contracts to overseas international financial organizations, foreign governments, financial institutions, enterprises or other institutions.
According to the nature of the problem
According to the different nature of issuance, national debt can be divided into free national debt and compulsory national debt, also known as arbitrary national debt, which refers to the national debt issued by contemporary countries and voluntarily subscribed by citizens, legal persons or other organizations.
national debt
Common forms of national debt are easily accepted by buyers. Compulsory national debt is the national debt that the state forces citizens, legal persons or other organizations to buy by virtue of its political power and according to the prescribed standards. This kind of national debt is generally used in wartime or when there are financial and economic difficulties or when specific policies are implemented and specific goals are achieved.
Depending on the purpose of use
According to different purposes, national debt can be divided into deficit national debt, construction national debt and special national debt deficit national debt, which refers to the national debt used to make up the fiscal deficit. In countries with dual budget system, the national debt included in the regular budget belongs to deficit national debt. Construction national debt refers to the national debt used to increase national investment in the economic field. In countries with dual budget system, the national debt included in the capital (investment) budget belongs to the construction national debt. Special national debt refers to the national debt issued to implement special policies within a specific scope or for a specific purpose.
Depending on whether it can be circulated
According to whether it can be circulated, national debt can be divided into listed national debt and unlisted national debt, also known as tradable national debt, which refers to the national debt that can be freely bought and sold on the stock exchange. Unlisted treasury bonds, also known as unsold treasury bonds, refer to treasury bonds that cannot be bought and sold freely. This kind of national debt generally has a long term and high interest rate, and is mostly issued by registered method. Edit the classification of China national debt in this paragraph.
From the form of bonds, bonds issued in China can be divided into four types: voucher bonds, bearer bonds, savings bonds bonds and book-entry bonds.
Certificate bond
It is a national savings bond and can be registered to report the loss. Creditor's rights are recorded in the form of "voucher-type treasury bonds receipts" and cannot be listed and circulated. Interest shall be calculated from the date of purchase. During the holding period, if the holder needs to withdraw cash under special circumstances, he can redeem it at the purchase outlet in advance. When redeeming in advance, in addition to repaying the principal, the interest will be calculated according to the actual holding days and the corresponding interest rate grade, and the handling agency will charge a handling fee of 2‰ of the principal.
Bearer (physical) national debt
It is a kind of physical bond, which records the creditor's rights in the form of physical vouchers, with different face values, anonymity, no loss reporting and can be listed and circulated. During the issuance period, investors can buy directly at the counter of the institution that sells government bonds. Investors who set up accounts in stock exchanges may entrust securities companies to purchase through the trading system. After the issuance period is over,
Bearer (physical) national debt
[2] The holder of the physical coupon can sell it at the counter, or hand it over to the stock exchange for custody, and then sell it through the trading system. At present, it has stopped issuing.
Savings bonds
Savings bonds (also known as electronic national debt) is a kind of unregistered registered national debt issued by the government to individual investors in order to absorb personal savings funds and meet the needs of long-term savings and investment. Electronic savings bonds is a savings bonds variety that records creditor's rights electronically.
Savings bonds
[3] Book-entry treasury bonds
Creditor's rights recorded in the form of bookkeeping are uniformly issued by the Ministry of Finance, issued and traded through the trading system of the stock exchange, and can be registered, reported for loss and listed for transfer. Investors who buy and sell book-entry securities must set up accounts in the stock exchange. Because the issuance and transaction of book-entry treasury bonds are paperless, it has high efficiency, low cost and safe transaction. Edit the role of national debt in the market economy in this paragraph.
1. Make up the fiscal deficit
Making up the fiscal deficit is the most basic function of national debt. Generally speaking, there are two reasons for the government's fiscal deficit: one is economic recession, and the other is natural disasters. Once the government has a deficit, it must find ways to make up for it. Under the market economy system, there are three main ways to make up for it: increasing taxes, issuing additional currency and borrowing national debt. The first way not only can't raise a lot of money quickly, but also heavy taxes will affect the enthusiasm of producers, further shrink the national economy, narrow the tax base, and may make the deficit bigger. The second way will greatly increase the money supply of society, lead to excessive inflation and disrupt the operation order of the whole national economy. The third way is the most feasible way, because issuing treasury bonds to raise funds is only a temporary transfer of the right to use social funds. Under normal circumstances, it will not lead to excessive inflation, and at the same time, it can make up the fiscal deficit quickly, flexibly and effectively. Therefore, borrowing national debt is the most basic and commonly used way for governments all over the world to make up the fiscal deficit.
2. Adjust the surplus and deficiency of seasonal funds in the budget.
Using national debt, the government can also flexibly adjust the seasonal surplus and deficiency of funds in the process of fiscal revenue and expenditure. 1 year, government revenue often does not flow into the state treasury at a balanced rate, while fiscal expenditure often proceeds at a relatively balanced rate. This means that even if the government budget is balanced throughout the year, there will be considerable deficits in individual months. In order to ensure the performance of government functions, many countries will adopt short-term treasury bonds with a term of 1 year (usually a few months, and the longest is no more than 52 weeks) as a seasonal fund adjustment means to solve the temporary fund imbalance.
3. Macro-control the operation of the national economy
A country's economic operation cannot always be in a state of steady and sustained growth. On the contrary, due to the influence of macro-policy mistakes, international economic influence and other factors, economic operation often deviates from people's expected ideal track, resulting in economic over-expansion (serious inflation) and economic contraction (deflation). At this time, the government must take corresponding policies and measures to intervene in the economy, so that the economic operation can return to an ideal or expected track. Since the establishment of Keynesian macroeconomic theory, it has become a common phenomenon to use economic policies to regulate macroeconomic operation, in which national debt plays a very important role. This also makes the macro-control function of national debt gradually become the main function of national debt. Edit the properties of this paragraph.
The difference between national debt and bank savings
The financial issuance of national debt is different from the bank's absorption of savings. The issuance of national debt in China has a strong administrative color from the beginning, and it is its political significance that is widely publicized, not its economic role and benefits. At the same time, in the issuance propaganda, the national debt is compared with bank savings, which confuses the difference between national debt and bank savings. In fact, national debt has always been similar to bank savings, and this problem does not want to be different from bank savings. Therefore, for many years, people have known that the difference between national debt and bank savings is only that the undertakers are different, that is, one is the bank and the other is the finance; Then, the issue rate of national debt is always higher than bank savings. In other words, the function of finance is different from that of banks, and the credit of finance is also different from that of banks. Therefore, the issuance of treasury bonds by the government can never be equated with the absorption of savings by banks. Finance can neither provide savings services for the general public like banks, nor compete with banks for limited social savings. If we say that in the era when the national debt just came into being, that is, in the developed modern market economy, it is not allowed to confuse financial credit with bank credit, that is to say, the mechanism and significance of fiscal issuance of national debt must not be different from that of bank absorption of savings in principle. Defining the different nature of national debt and bank savings in theory is the cognitive basis for standardizing the issuance of national debt, and it is also a necessary prerequisite for perfecting the national debt market and giving full play to its role.
Three attributes of national debt
1, the issuance of national debt can play a special role in making up the gap between investment and savings in the operation of the national economy, while bank savings only absorb temporarily unused funds from the public. Bank savings can play the role of converting savings funds into investment funds, and can also play the role of transferring realized consumption capacity, and transfer some people's deferred consumption funds to another people for actual consumption. This is the role of bank credit. In contrast, financial credit should not play the same role as bank credit. In essence, the financial issuance of treasury bonds should avoid being similar to bank savings, because as long as the issuance of treasury bonds is equivalent to bank savings, it is better to overdraw treasury bonds directly. Under the condition of commodity economy, the basic requirement of national economic operation is that production equals consumption and investment equals savings, that is, consumption is less than production, social reproduction will shrink, investment is less than savings, and social consumption will be less than production, resulting in some social funds and production results being idle. Therefore, the financial issuance of treasury bonds is different from the bank's absorption of savings, and its mechanism lies in that treasury bonds can balance investment and savings and make up for the investment gap. This is because under the current financial system, after banks absorb savings, they can't turn all the savings funds into investment funds except the actual consumption capacity, and they must keep some of them as reserves. In fact, the existence of this kind of reserve has formed an unbalanced gap between social capital investment and savings. In the modern market economy, the financial issuance of national debt is mainly aimed at this gap, that is, issuing bank reserves. Because national debt has the best reputation and the most convenient realization, it can play this special role like a bank. By issuing national debt to absorb savings, finance not only loses its special function, but also infringes on the social financing function of bank credit. 2. Issuing national debt is to exercise the economic management function of the country, while bank savings only show the existence of a financial credit relationship. The economic construction that the country is engaged in is different from the general market economic activities. Under the traditional system, China is centralized, that is, all economic activities are controlled by the state, which is the object of reform. At present, the market economic system is established and improved, and the economic construction that the state is responsible for is limited to non-competitive areas such as infrastructure, and generally does not involve the content of competitive areas. This is the application of the national economic management function. The issuance of national debt is to play the role of this economic management function of the country. The state can effectively regulate the operation of the national economy by investing in national debt. Relatively speaking, the role of national debt is unmatched by bank savings. In the past, in China, calling on people to economize was also a kind of political mobilization, which was a concrete embodiment of the centralized economic system. People always emphasize that savings are used to support national economic construction. Now, after the transition to the new economic system, the traditional concept has long changed, and bank savings have fallen back to the general market economy behavior, which only reflects the credit relationship between individuals and banks and has no significance of direct investment in national economic construction. 3. The interest rate of national debt should be the benchmark interest rate in the capital market, and bank savings can't play the role of this credit tool. National debt is issued by the central government, or, compared with the currency issued by the state, national debt is a kind of credit certificate second only to currency, which can almost play the role of quasi-currency. Because national debt has the strongest liquidity and the most convenient liquidity, the interest rate of national debt can only be the lowest among all credit instruments. Therefore, the interest rate of national debt should objectively play the role of benchmark interest rate. In the capital market, the standard market operation should maintain the benchmark interest rate position of the national debt interest rate, and any market credit relationship that cannot make the national debt interest rate the benchmark interest rate is bound to be irregular. Similarly, this credit function of national debt is not available in bank savings offices. Under the premise of the existence of national debt, the bank deposit interest rate should not and should not be allowed to become the benchmark interest rate unless the credit relationship in the financial market is distorted. That is to say, in real life, it is abnormal that the interest rate of national debt is higher than the bank deposit rate, which is an obvious manifestation that the issuance of national debt does not meet the requirements of the basic operation mode of modern capital market. In this paragraph, edit the advantages and disadvantages of citizens buying government bonds
Buying government bonds is a relatively safe investment method for ordinary citizens, with the lowest risk and the guarantee of national reputation, so it has the reputation of Phnom Penh bonds. Relatively speaking, it is a credit tool with high security, huge financing scale and convenient realization. However, national debt also has some disadvantages, that is, time, and the repayment period of national debt is generally longer. If citizens invest most of their money in national debt. Before the repayment deadline, if you need money urgently, you will encounter the dilemma of poor turnover. So you can't buy too many government bonds at a time. Edit this question
1, issue price of national debt
Fair price problem. In other words, the issue price is equal to its face value. When the bond matures, the state will repay the principal and interest at this price. Sell at a discount. That is, the issue price is lower than the face value of the bond. When the bond matures, the state needs to repay the principal and interest at face value. It is different from discount issue. Premium issue. That is, the issue price is higher than the face value of the bond. When the bond matures, the state only pays the principal and interest of the face value of the bond.
2. Issuance of national debt
Public offering law. That is, issuing government bonds through public bidding in the financial market. According to the rules for determining the winning bid, the public offering bidding method of national debt issuance can be divided into three forms: payment period, price and yield bidding, single price bidding (Dutch style) and multiple price bidding (American style). Bearing method. That is, financial institutions take over all the national debt, and then turn to social sales, and the unsold part is borne by financial institutions themselves. Sales method. That is, the government entrusts marketing agencies to use the financial market to directly sell government bonds. Payment and distribution law. That is, the government should pay cash instead of government bonds. Compulsory apportionment method. In other words, the state uses political power to force its citizens to buy government bonds. Edit this reimbursement
1, the way to repay the national debt
Repayment by installments. That is, a national debt stipulates several repayment periods, and the principal is fully paid off when the national debt expires. Revolving withdrawal and repayment method. That is to say, a certain proportion of national debt is determined by drawing lots regularly according to the national debt number until the repayment period ends, and all national debt is paid off by drawing lots. One-time repayment at maturity method. In other words, the national debt is paid off in one lump sum according to the par value of the maturity date. Market purchase and sale compensation law. That is, to buy back the national debt from the securities market, even if it expires, this national debt has been fully held by the government. Replace the old repayment method with a new repayment method. That is, by issuing new treasury bonds in exchange for expired old treasury bonds.
2, the source of funds to repay the national debt
Adopt the budget. The government will include the annual repayment of national debt as a fiscal expenditure item in the expenditure budget of the year, and normal fiscal revenue will ensure the repayment of national debt. Use fiscal surplus. When there is a balance in budget implementation, this balance will be used to pay the principal and interest of the national debt due in the current year. Set up a sinking fund. The government budget sets up a special fund to repay the national debt, and allocates special funds from the fiscal revenue every year to set up a fund dedicated to repaying the national debt. Borrow new debts to pay off old debts. The government issues new bonds as a source of funds to repay old debts. The essence is the extension of the debt period. Editor's Note: Changes in China's National Debt Issuance
Non-market issue period
During the period of non-market issuance of national debt, every year the state issues national debt, which requires different levels of political mobilization and even administrative apportionment. After the issuance of government bonds is completely market-oriented, people see that the issuance of government bonds every year causes a big move in bank savings, and quite a few people buy government bonds with bank certificates of deposit. This phenomenon directly shows that the issuance of national debt in China is not standardized and does not conform to the nature of national debt.
Three major changes
Therefore, on the basis of accurately defining the credit function of national debt, the following changes will be realized in the issuance of national debt in China in the future. 1, mainly for residents, mainly for financial institutions. In order to make up the investment gap, the issuance of national debt must be mainly oriented to financial institutions. For a long time, because China's national debt is mainly issued to residents, the special function of national debt investment has almost been abandoned. The issuance of national debt is basically similar to the absorption of savings by banks. Moreover, in order to attract residents to buy government bonds, the interest rate of government bonds is always higher than the savings rate of banks, which correspondingly makes the interest rate of government bonds lose its position as the benchmark interest rate. Therefore, in order to standardize the national debt market, the most basic requirement is to change the issuing target, from mainly for individual residents to mainly for financial institutions, especially for major commercial banks. This change means that banks are no longer institutions selling government bonds, but the main force buying government bonds. In this regard, it should be an obvious sign of the normalization of China's national debt market that commercial banks stop selling national debt to residents. At present, there is basically no difference between the types of national debt issuance and bank deposits. 1 year bonds, 2-year bonds, 3-year bonds and 5-year bonds correspond to the bank's 1, 2-year, 3-year and 5-year time deposits. With the change of the issuing object, the issuing varieties of national debt must also change. According to the needs of developing the open market business of the central bank, the treasury bonds issued by commercial banks' reserves should be short-term treasury bonds within 1 year, that is, treasury bonds with maturities of 4 weeks, 8 weeks, 3 months and 6 months. If the distribution object changes, from individual residents to financial institutions, and the distribution variety remains unchanged, then the change of distribution object is meaningless. In other words, the change of issuing varieties is related to the change of issuing objects, which is a changing relationship. As far as the national debt market is concerned, the issuing methods, issuing objects and issuing varieties should be standardized in place. The determination of distribution type is set according to the needs of distribution objects. Specifically, the treasury bonds purchased by commercial banks with reserves can only be short-term treasury bonds. The United States is a country with a mature national debt management system, and the national debt issued to financial institutions is short-term national debt. The trend of China's national debt market is not unique, but it should be one of the important contents of market supervision to abide by international practice and turn to issuing short-term bonds. In addition, national debt can not only be issued to financial institutions. When the main issue target is financial institutions, that is, commercial banks undertake the main task of purchasing government bonds, it is not excluded that the financial department can directly issue a small number of special types of government bonds to individual residents. These special types of national debt generally have a maturity of more than 10 years, up to 30 years. This is not in the variety of bank deposits, but the variety of national debt issuance is different from bank deposits. In some countries that issue treasury bonds for a long time, most of them are issued to individual residents, avoiding issuing treasury bonds with the same bank deposit period. This kind of national debt can be exempted from interest tax, which is mainly purchased by individual residents for their children's education expenses or personal assets reserves, which is very beneficial to stabilizing residents' lives. In order to change the variety of national debt issued in China, we should not only issue short-term national debt for financial institutions, but also develop new long-term national debt for individual residents. 3, from the entrusted bank to the individual residents and then to the financial sector to set up their own national debt issuers. For a long time, China's national debt is mainly issued to individual residents 1 year to 5-year bonds, so the financial department has to entrust the banking system to issue the bonds on its behalf, and at the same time pay a high agency issuance fee. Major commercial banks are also aiming at this huge agency fee, and they are eager to move at the expense of blood. People withdraw money from banks to buy government bonds because the interest rate of government bonds is higher than that of bank savings, and debt interest's income is not taxed; Banks sell treasury bonds because there is a fixed issuance fee to be recorded; Both buyers and sellers are profitable, but as far as society is concerned, they have paid unnecessary financing costs, because the money used to buy government bonds has been well kept in banks and can be used centrally by society. There is really no need to turn it around in vain and increase interest and issuance costs. Therefore, after changing the issuing object, the national debt will no longer be mainly issued to individual residents, and the situation of bank savings moving will not happen again, and the history of issuing national debt by banks will end. Under this premise, the financial sector must establish its own permanent issuer. This kind of national debt issuer is different from the national debt management department in the period of administrative apportionment, and it is also different from the banking institution as an agent issuer, but a specific office directly under the government financial department. It is not a commercial organization in itself, but only plays the role of issuing government bonds. The short-term bonds issued by this institution are for financial institutions, and the long-term bonds issued by this institution are for individual residents, that is, not only for financial institutions, but also for individual residents, but mainly for financial institutions, and national debt for individual residents can also be issued by entrustment. So far, China's financial department has only set up a national debt management institution, but has not set up a special national debt issuing institution. However, in order to improve China's national debt market, change the issuing objects and varieties, and take the same road of developing the national debt market in all market economy countries in the world, it is necessary to set up a financial department specifically responsible for issuing national debt as soon as possible as the basic organizational guarantee for standardizing the issuance of national debt. Looking at the future of China's national debt market, the standardized issuance of national debt and the standardized establishment of national debt issuing institutions will surely play an important and fundamental role in its perfection. Edit this foreign bond held by China.
U.s. treasury bonds
According to the latest report of the US Treasury Department, at the end of 2009 10, China held US$ 798.9 billion in US Treasury bonds, which was the same as that in September. Among them, it holds US$ 654.38+354.48 billion in short-term US Treasury bonds, accounting for about 17%, and China is still the largest foreign holder of US Treasury bonds.
Trouble with US Treasury bonds
According to the data of the US Treasury Department, by the end of June 2009, China held about 479.768 billion US dollars of long-term institutional bonds, 24.546 billion US dollars of long-term corporate bonds and 654.38+0.075 billion US dollars of stocks. Since September 2008, China has surpassed Japan to become the world's largest holder of US Treasury bonds. At the end of 2009, China held US$ 894.8 billion in US Treasury bonds, accounting for 37% of China's foreign exchange reserves at the end of 2009 and 18% of China's GDP in 2009. For China investors, holding U.S. Treasury bonds will also bring the following costs or risks: holding U.S. Treasury bonds will face capital loss caused by the depreciation of the U.S. dollar in valuation effects or the decline in the market price of U.S. Treasury bonds. On the one hand, the Fed's interest rate hike will lead to a decline in the market price of US Treasury bonds; On the other hand, after the subprime mortgage crisis, the increase of investors' risk appetite led to the outflow of safe-haven funds from the US Treasury bond market, which also led to an increase in the yield of US Treasury bonds and a decrease in the market price of US Treasury bonds. After 200 1, affected by the slowdown of American economic growth, especially the real estate market, which is the core indicator of CPI, continued to decline after 2005, and the US dollar continued to fall. As the world's major settlement currency, the US dollar once again encountered a crisis of confidence. The depreciation of the US dollar has led to global inflationary pressure and reduced the wealth of foreign exchange assets held by US dollar reserve countries. The depreciation of the dollar is also a common way for the United States to transfer the crisis to other countries and restrict the normal development of other competitors. In 1980s, the United States forced the yen to appreciate, which triggered the expansion of Japan's economic bubble and eventually burst. At present, the United States is using the "weak dollar" policy to export recession to the world. The main targets of this round of dollar depreciation are euro and RMB. Trouble with US Treasury bonds Holding US Treasury bonds faces higher opportunity cost or actual cost. The average annual yield of US 10 national debt is 3%-6%, which is far lower than the average yield that investors can get by investing in stock index or direct investment. For China banks, holding US Treasury bonds has a more realistic cost. This is because the accumulation of foreign exchange reserves of the central bank will lead to an increase in foreign exchange holdings. In order to prevent the impact of the increase in foreign exchange holdings on the domestic base currency, the central bank usually uses the method of issuing central bank bills for verification, which has interest costs. Edit this paragraph about the national debt law.