Monday, April 18, 2016
Call The Saudi Bluff!
Some are warning of impending doom should the Saudis sell off their 4% stake of the U.S. bonds in a hissy-fit fire sale. Not to fear, the end is not near.
During last month’s visit to Washington, the Saudi Foreign Minister, Adel-al-Jubeir, delivered a threatening message from the Saudi King.
Congress had better reconsider passing a new law under consideration in the Senate which would allow the kingdom to be held responsible for their role in the 9/11 terror attacks.
The Saudis are fearful that nearly a trillion dollars of their U.S. assets could be frozen by U.S. courts involved in lawsuits by 9/11 family groups and other interested parties. So, they would sell off all U.S. assets, including some 750 billion dollars in U.S. national debt.
The threat is that Saudi Arabia is the third-largest holder of U.S. debt instruments and if they decided to flood the market it could sharply increase interest rates the U.S. would have to pay on its perpetual new bond selling activities – new debt.
President Obama and the rest of his administration has lobbied against the bill furiously – some say desperately -- in Congress. The bill makes clear that the immunity from civil suits granted to foreign nations will not apply if that nation is found responsible for terrorist attacks that kill Americans an United States soil. Click the link below.