On Tuesday, the US Treasury published its December "TIC" data, the compilation of securities transactions between foreign investors and US residents. ["TIC" is an acronym for Treasury International Capital.] The data are contained in Haver's USINT database in the section "US International Investment Tables", shown by security type and country. Net foreign purchases of all kinds of securities were $75.7 billion in December and totaled $707.9 billion for 2003. This total is $133.3 billion larger than the previous record, $574.6 billion, set just in 2002.

In the aggregate, this substantial foreign participation in US securities markets clearly illustrates that those investors were not driven away by concerns over 9/11 or other terrorist threats; there was a brief dip in September 2001, but net purchases bounced back immediately. Nor have highly publicized scandals involving US companies and financial markets since mid-2002 discouraged foreign capital inflows.

One aspect that has undergone change is the mix of securities types. Initially, as seen in the graph, total foreign purchases seemed nearly synonymous with those of Treasury securities. However, since late 1996, the trends in the totals and in Treasuries have diverged. Foreigners diversified their portfolios, as they increased their acquisition of federal agency securities, corporate bonds and stocks. Interest in this last item turned down in 2000, with the general pullback in equity values. But purchases of corporate bonds have remained sizable, as indicated in the table below, implying a sustained appeal of corporate securities even through swings in exchange rates, interest rates and asset values.