SB@70: c) Right now, the Federal Reserve is the second largest holder of T-Bills, right behind China and Right above Japan.

The Federal Reserve holds $5.4 trillion of US debt (as of Sept 2010).

About a decade ago, the total government holdings were “only” $2.5 trillion.

The No. 2 spot of 1.5 trillion is held by “Others:”

With the most recent numbers from Sept 2010, this extremely diverse group includes individuals, government-sponsored enterprises, brokers and dealers, bank personal trusts, estates, savings bonds, corporate and non-corporate businesses for a total of $1.458 trillion.

Although the level of debt held in U.S. savings bonds has remained relatively constant since 2000, the broad category of “Other” investors has nearly quadrupled since reaching a four-year low in September 2007.

China and Japan are essentially tied at No. 3 ($0.90 trillion) and No. 4 ($0.88 trillion), respectively.

It’s not so much a quibble about ranking as it is about relative numbers. Not far behind China and Japan are Pension Funds ($0.71 trillion) and Mutual funds ($0.64 trillion.)

But I agree with the conclusion in subsection e).