As America's debt continues to grow, is it causing foreigners to think twice about investing in America? The U.S. has been one of the most stable countries over the past century. It has remained stable through two world wars, numerous administration changes and economic and political crisis around the world.

But America has been borrowing more and more money and has a debt that is approaching $12.1 trillion. Countries do fail because they spend too much and ultimately try to print their way to success.

With congress set to raise the limit on the national debt, let's take a look at just how much money that is.

With a total statutory debt limit of $12.1 trillion ($12,100,000,000,000) and the U.S. population at 304 million (304,000,000), the debt per American is $39,800.

There is a disturbing trend that is taking shape across the international financial markets. It involves primarily Russia, Brazil and China. Just what are these countries up to? They may be tipping the balance of international finance into uncharted waters.

Specifically, they are buying smaller quantities of U.S. treasuries and using their excess reserves to buy other non-dollar denominated assets. For example, in April total net purchases of long-term equities, notes and bonds rose a net $11.2 billion compared with a gain of $55.4 billion in March. International holdings increased $41.9 billion in April, compared with $55.3 billion in March.

Warning: This stuff may be a bit scary. Let's start off by reviewing the events of the past few days. Standard & Poor's downgraded the sovereign debt of Britain from "stable" to "negative" because Britain's debt could equal 100% of GDP and stay there for a few years.

Now word has traveled across the pond and has spread concern here in the U.S. Our debt is exploding and will also rise faster than our GDP. At the end of 2008, U.S. federal debt will equal 41% of GDP. It is expected to rise to 82% of GDP in 10 years and could reach 100% of GDP in fifteen years. Such a debt burden is incompatible with our triple-A rating.

It is feared that such a debt burden would be worse than the recent financial crisis. If we fast forward 10 years, the estimates are that our debt will be $1.2 trillion while our tax revenues would be $2 trillion. This means that we would need a 60% tax increase to balance the budget.

This time it could be different. Maybe

U.S. Treasury Secretary Henry Paulson is traveling to China to discuss "all-things economic and financial" and the U.S.'s enormous trade deficit with China will certainly be at the top of the agenda.

The U.S., including several U.S. multinational corporations like Caterpillar, Inc. (NYSE: CAT), argue that China is manipulating the value of its currency -- keeping it artificially low -- in order to gain a competitive advantage for its manufacturers, who feed low-cost goods to markets around the world, especially to the United States.

Conversely, China argues that U.S. consumers' overspending, low savings rate and the U.S.
Government's budget deficit are at the root of the U.S.-China trade deficit and the dollar's low value vs. China's currency, the yuan.

Previous talks with China have produced few substantive changes in the trade relationship between the two economic giants. China has moved to a tight-band fixed currency policy -- one that allows the yuan to appreciate slightly -- but the exchange rate is still fixed, in reality. Meanwhile, U.S. consumers continue to spend more than they should, and the U.S. racked up its highest monthly trade deficit level in 6 months, to $63.9 billion in April. The U.S. is also on a pace to register a near-record $722.6 billion trade deficit in 2007, just below 2006's $765.3 billion.