Debt Excerpt

Consequences of foreign ownership of U.S. debt
U.S. Treasury statistics indicate that, at the end of 2004, foreigners held 44% of federal debt held by the public. [8] About 64% of that 44% was held by the central banks of other countries. A large portion was held by the central banks of Japan and China, although, most was held by members of the EU. This exposes the United States to potential financial or political risk that either banks will stop buying Treasury securities or start selling them heavily. In fact, the debt held by Japan reached a maximum in August of 2004 and has fallen nearly 3% since then. [9]
On 3 August 2006, Italy's central bank announced that it would sell off a large portion of its dollar holdings (including US Treasury bonds) and instead shift to British Pound Sterling. The reason Italy gave for doing out of fear of an "expected slide in the dollar." Russia, Sweden, and the United Arab Emirates had announced similar shifts out of the dollar into other currencies and gold earlier and cited the United States's "twin deficits" (i.e. the US trade deficit as well as its budget deficit) as the reason for the expected fall in the dollar's value.[10]