Allen Stanford forfeited $3 million in drug money back in 1999, and it’s a sure thing that within his multi-billion empire he had many more drug dollars under his care. This is true not just of Stanford, but of the whole Caribbean offshore banking complex, as drug dealers are obviously interested in the regulation-light, few-questions-asked private banking system.
Offshore banks, meanwhile, have grown rapidly as major purchasers of US treasuries over the years. As you can see in the chart below, they really spiked in the 04-05 range, right as Japanese holdings leveled off. According this table, Caribbean banks are now the fourth biggest holders of treasuries, having surpassed Brazil and all the oil states combined in just the last year.
So again, how much drug money goes into financing our debt?
And if you doubt the premise of our question, here’s famed rapper KRS-One making basically the same point
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.