What is a t-bill?

Question

A friend of mine told me we are borrowing money from China using t-bills and that china could crush our economy. I can't find much about them online. Has anybody heard of this or is he giving me bs?

Answer 1

T-Bill stands for Treasury bills issued by the US government.

http://www.treasurydirect.gov/indiv/research/indepth/tbills/res_tbill.htm

Answer 2

Treasury notes are the instrument that the Fed uses to make up the difference between tax income and outflow.

China like the US operates at a deficit. I could be very wrong but I recall an article that said that Chinese Banks were buying T-bills with the savings deposits of the average Chinese worker as it was safer than investing in their own market. Maybe their own market is not big enough and they have to go offshore.

Our Banks make money from interest on any type loan they fund, plus fees. (mortgage, auto, VISA, MC, etc)

I will guess that credit cards are the big money maker. Don't think the Chinese economy is at the personal debt level we are.

Answer 3

Let's say you buy a house, then you borrow to put in a pool, from China, for lets say $10,000, you pay back China at the rate of 10%, the agreement is that China will hold the debt for 30 years or until China wants it's money back. This debt is called T-bills, so for every $10,000 China give you, you give them a T-bill. So this borrowing goes on and on. First the pool, then you want to add a second story, for $30,000, so China give you $30,000 and you give China 3 T-bill for $10,000 each. This goes on and on for many years, to the tune of lets say $500,000. So one day China calls your loan, which is the agreement. At this point you have to sell your house and borrow the rest to pay back China
The difference is that when we sell our debt to China or others, if they call our debt we have to pay up, and we owe to China, Japan, and other counties a debt of about 10 trillion dollars

Answer 4

Treasury bills, are US bonds which are sold in terms ranging from a few days to 26 weeks. Bills are sold at a discount from their face value. For instance, you might pay $970 for a $1,000 bill. When the bill matures, you would be paid $1,000. The difference between the purchase price and face value is interest.

The idea is Supply and Demand , the FED lowers supply by holding on to your money and therefor increases demand of dollars, making dollars more powerful and hopefully results in resisting inflation.

Answer 5

a t-bill is a toosh bill. The U.S. plans to send prostitutes from Nevada over there to take the issue in hand (so to speak)

Answer 6

it is when a fish gives you a *******