It has been a misconception that China is the largest holder of U.S. debt. According to the U.S. Treasury Department thatâ€™s not true. The biggest holders of US debt are American individuals, institutions, and Social Security that account for almost 67%. China only holds 7.5%.
At the end of the fiscal year (Sept. 2010) the U.S. debt was $13.562 trillion. And to date it has exceeded $14 trillion.
Below is a chart showing the distribution of U.S. debt holdings.
U.S. Treasury Department:
Monthly Statement of the Public Debt of the United States
Major Foreign Holders of Treasury Securities.