How big is the US Treasury bond market?
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As of 2021, the size of the bond market (total debt outstanding) is estimated to be at $119 trillion worldwide and $46 trillion for the US market, according to the Securities Industry and Financial Markets Association (SIFMA). Bonds and bank loans form what is known as the credit market.
You might think the stock market is huge, but the bond market is even bigger. According to the Securities Industry and Financial Markets Association (SIFMA), the global bond market was worth $140.7 trillion at the end of 2023, compared to the $115 trillion global equity market cap.
The market has grown dramatically since the pandemic and the Congressional Budget Office forecasts it will almost double in size over the next 10 years, with government deficits and the rising cost of interest payments pushing the market from today's $27 trillion to around $46 trillion.
Outstanding (as of 3Q24) $4.2 trillion, +2.9% Y/Y.
Annual totals are based on data from April of each year. Inflation adjusted to the 2023 calendar year. As of April 2024, the five countries owning the most US debt are Japan ($1.1 trillion), China ($749.0 billion), the United Kingdom ($690.2 billion), Luxembourg ($373.5 billion), and Canada ($328.7 billion).
The U.S. Treasury markets are the largest and most liquid government bond markets in the world. They are vital for financing U.S. government operations and serves as a benchmark for global interest rates.
Stocks have historically delivered higher returns than bonds because there is a greater risk that, if the company fails, all of the stockholders' investment will be lost (unlike bondholders who might recoup fully or partially the principal of their lending).
As of mid-December, $617 billion had flowed into developed and emerging market bond funds, according to financial data provider EPFR, topping 2021's $500 billion and putting 2024 on track to be a record year. Stocks, meanwhile, have drawn $670 billion of inflows as indexes in the U.S. and Europe scale new heights.
Currently, 62% of Americans own stocks, reaching a 20-year high. Breaking it down further, 87% of upper-income Americans own stocks, followed by 65% of middle-income Americans, and 25% of lower-income individuals.
How big is the T bill market?
The U.S. Treasury market is a bedrock of the global financial system. Today, there are $27 trillion of Treasury securities outstanding. An average of over $879 billion are traded every day.
The US 10 Year Treasury Bond Note Yield is expected to trade at 4.32 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 4.28 in 12 months time.

Treasury bonds offer guaranteed fixed income every six months for 20 or 30 years. Although T-bonds' fixed interest rate is low compared to other high-yield securities like stocks, bondholders have the security of guaranteed income over the long term.
- Japan. Japan held $1.13 trillion in Treasury securities as of November 2024, beating out China as the largest foreign holder of U.S. debt. ...
- China. China gets a lot of attention for holding a big chunk of the U.S. government's debt. ...
- United Kingdom. ...
- Cayman Islands. ...
- Luxembourg.
Narrator: As of 2020, the U.S. bond market had some $50.1 trillion outstanding dollars invested, while the market cap for the entire U.S. stock market is just $40.7 trillion. The bond market is made up of issuers—like the federal government, municipalities, and corporations—looking to borrow money from investors.
Issue | maturity range | today |
---|---|---|
national | 10 year | 2.85 |
national | 20 year | 3.40 |
national | 30 year | 3.70 |
Buffett hasn't been a fan of bonds for a long time. He prefers equities, which offer capital-appreciation potential, and cash—mostly risk-free U.S. Treasury bills—which mature within a year.
If China (or any other nation that has a trade surplus with the U.S.) stops buying U.S. Treasuries or even starts dumping its U.S. forex reserves, its trade surplus would become a trade deficit—something which no export-oriented economy would want, as they would be worse off as a result.
Elementary economic forces — too much supply and not enough demand — have collided to create the worst stretch for U.S. government bonds since the Civil War. The government keeps borrowing to cover its budget deficits, while once-reliable buyers of that debt, both at home and abroad, have pulled back.
Increasing Bets On Treasury Futures By Hedge Funds
These funds use borrowed money from the repurchase-agreement (repo) market to increase their potential returns. The IMF warns that the scale of these bets has grown large enough to spark concerns among financial stability observers.
What is the most liquid asset in the U.S. economy?
Cash and Cash Equivalents
Cash is the most liquid asset possible as it is already in the form of money. This includes physical cash, savings account balances, and checking account balances.
At $28 trillion outstanding,1 today the U.S. Treasury market is the deepest most liquid government bond market in the world (Exhibit I). The Treasury market efficiently finances the U.S. government, is used to implement monetary policy and is a safe haven for investors in times of stress.
Bonds usually go up in value when the stock market crashes, but not all the time. The bonds that do best in a market crash are government bonds such as U.S. Treasuries. Riskier bonds like junk bonds and high-yield credit do not fare as well.
The bond market is a wide field, with many different categories of assets. In general, you can expect a return of between 4% and 5% if you invest in this market, but it will range based on what you purchase and how long you hold those assets.
Most bond investors are in it for the long haul, meaning for the term of the bond, but there are several good reasons for selling bonds before they mature. They include: Selling bonds because interest rates are about to increase, making your existing bonds less valuable.