40% of All New US Debt Purchased Since 2022? Has Been in the Cayman Islands
The US government is $39+ trillion in debt. It is currently adding $1 trillion to its tally every five months.
And through the magic of compound interest? The debt accumulation will only continue to accelerate.
Because Lord knows the government ain’t paying any of it back.
Because Lord knows the government increases its annual deficits - over the previous annual deficits - every time it writes a budget.
When DC is this fundamentally unserious? Things for the US get really serious - really fast.
The only thing at this point DC can do? Is postpone the inevitable. By any means necessary.
It’s Bernie Madoff time. At $7+ trillion per year.
Never mind what you’ve heard about the idiotic, criminal Federal Reserve lowing interest rates.
Though The Fed may indeed ratchet them down a quarter point or two in the near term? It will be like trying to put a tin can lid on the top of an erupting volcano.
Because the real monetary pressure is HUGE - and upward. And it’s only getting huger. Because the US debt keeps getting huger. And ever harder to finance.
The US needs to fund its debt. The two main ways to do this?
Sell bonds - Treasuries - to buyers via auctions. Or print money - to buy its own Treasuries. Thus turning IOUs - into IOIs.
Now, The Fed is prohibited from buying from itself new Treasuries. But it can buy existing Treasuries - what has been euphemistically termed “quantitative easing (QE).”
These purchases then sit on The Fed’s balance sheet. Which increases and decreases as The Fed buys and sells assets.
According to Grok:
The current Federal Reserve balance sheet stands at approximately $6.66 trillion in total assets….Securities held outright:
~$6.371 trillion (the primary driver from past QE).
S. Treasury securities: ~$4.359 trillion.
Mortgage-backed securities (agency MBS): ~$2.010 trillion.
Other assets make up the rest (e.g., loans, foreign currency holdings, etc.).
Of course, the US buying - and holding - its own debt? Is an AWFUL look. It means it couldn’t find anyone else who wants it.
More good news: As the debt inexorably increases? That will only become more and more true.
Interest rates will have to rise ever higher. To entice anyone at all to buy the ever increasing debt.
Ok: Now we enter the realm of the theoretical. But it is an educated guess that we are about to make and examine.
Say the US government is having increasing difficulty selling its debt. And oh look - it is….
US Finance Problem: America’s Bonds Are Getting Harder to Sell
And even better news?
The Bond Market Sell-Off Is More Worrisome Than the One in Stocks
Investors Are Dumping Bonds. Here’s Why That’s a Problem
Not only do investors not want to buy new bonds? They are mass-selling the ones they have.
So The Fed is issuing new bonds - which they can’t sell. And more existing bonds are being dumped into the pool by the people who originally bought them.
The Fed at that point almost certainly has to ramp up its self-purchases. Of bonds new and old. Because $39+ trillion - is $39+ trillion.
But how does The Fed do that - without looking like its doing that? Because as we know: The Fed buying up its own debt is an extraordinarily bad look.
Hypothetically: Enter the tropical British overseas territory: The Cayman Islands.
Have some more Grok:
Historically, the Cayman Islands were associated with strong corporate secrecy and financial privacy, including strict banking secrecy laws that protected owner identities and business information from public disclosure. This contributed to its reputation as a “secrecy jurisdiction” in older rankings and leaks like the Paradise Papers.
However, corporate secrecy has significantly diminished in recent years due to global pressure for transparency:
Since 2017, the Cayman Islands maintain a centralized Beneficial Ownership Register under the Beneficial Ownership Transparency Act (updated through 2025–2026 amendments). Companies must identify and report beneficial owners (individuals with 25%+ ownership or control).
Access is not fully public. It is available to competent authorities (e.g., law enforcement, tax agencies) without restriction. For the general public, access requires demonstrating a “legitimate interest” via application to the Competent Authority (as per 2024–2025 regulations and recent reaffirmations in 2026).
The Cayman Islands have resisted UK pushes for fully open public registers, maintaining this restricted model to balance privacy and anti-abuse measures
Get that? Cayman secrecy from government has been reduced. But only reduced for government - not for us.
But what if it’s the government that wants that secrecy?
How the Cayman Islands Are Propping Up U.S. Debt:
“A small group of Federal Reserve economists raised alarm bells recently with the publication at the Fed’s website of an article showing that our current system depends on a group of shadowy hedge funds in the Cayman Islands lending huge sums of money to the United States government at low interest rates.
“We don’t know who is financing this lending operation or why they are doing it. But the entire federal government, apparently, depends on this money.
“Once the largest purchaser of U.S. government debt, the Chinese, along with other countries, began dumping their holdings some time ago.
“At the same time, the Federal Reserve reversed its seemingly interminable program of buying treasuries under the guise of responding, first, to the 2008 financial crisis and then the 2020 COVID-related financial panic.
“Slowly, but surely, both the Fed and the Chinese offloaded trillions in U.S. government debt at the same time the government ran record deficits - flooding the market with ever more IOUs.
“Basic laws of supply and demand dictate that when supply increases and demand craters, the price of the bond remains … unaffected and stable. Not what you’re expecting? Well, that’s what’s happening.
“So these plucky economists from the Federal Reserve set to crunching the numbers and discovered that a group of hedge funds headquartered in the Cayman Islands have been buying eye-popping levels of treasuries. In fact, they’ve purchased so many treasuries that they have become the world’s leading holder - surpassing China, Japan, and the United Kingdom.”
How hyperactive are these Cayman “hedge funds?”:
“40 percent of new treasury notes and bonds were purchased in the Cayman Islands after 2022.”
I have questions.
Again: It is the government telling us that it is Cayman “hedge funds” buying all of this US debt. Because the government has way more access to the Cayman information than do we.
Except: I don’t have a good history with the government telling me the truth.
And as we noted above….
Investors Are Dumping Bonds. Here’s Why That’s a Problem
And speaking specifically of hedge funds….
Hedge Fund Bets Against US Treasuries Threaten the Global Financial System
So hedge funds/investors the world over are dumping US bonds. Including China and the other nation-state investors.
But Cayman hedge funds are buying them? In HUGE numbers? That the government at first MASSIVELY underreported?
Now: It could be possible that these hedge funds are making some 5-D chess buy/sell/short play. And running ALL the buy portion - EXCLUSIVELY through the Caymans.
But that seems…unlikely?
Here’s my hypothetical:
What if The Fed is setting up a whole bunch of Cayman corporations? Behind the corporate veil - that we can not penetrate.
And then using them to mass-purchase bonds. To soak up the new bonds. And the existing ones everyone else is fire-selling.
Again: 40% of ALL new debt purchase since 2022 - has been in the Caymans. That’s TRILLIONS of dollars.
If The Fed is doing this? It is postponing - oops, and massively intensifying - the coming collapse.
Closing questions:
Which do you think is more realistic?
The Fed’s magical Cayman hedge funds theory? That these funds are doing what no other investors anywhere else on the planet are doing: Massively buying US debt?
Or my hypothetical Cayman-Fed straw men theory?
I would ask Madoff, but….