America's Growing Short-Term Debt

This chart summarizes the precarious nature of the treasury’s funding situation. As suggested by the table below, the amount of US government debt maturing in less than a year has spiked to nearly 45% vs. approximately 30% over the prior 25 years. A shortening of the maturity schedule reflects the growing concern that foreign governments and institutions have over our ballooning debt. While the treasury continues to have minimal difficulty in raising money, just as with any distressed borrower, lenders are putting the US on an increasingly short leash.

While near-term risk to the dollar’s vaunted status as the world’s reserve currency remains minimal (if only because a credible alternative does not exist), central banks have collectively started to voice concerns over our fiscal predicament. Most intend to gradually reduce the dollar’s share of their foreign currency reserves. For the sake of the dollar, lets hope they don’t all head for the exits at the same time.