[quote=Rich Toscano]Personally, I don’t believe this is the “big one”… I think it’s coming, but not until after our foreign creditors panic.[/quote]

I have the opposite point of view. I think our largest foreign creditors (a.k.a China and oil countries) did start to panic. However, they are not panicking about the dollar, as many think they would, but I always doubt about that because the dollar holdings are possessed by the rich and privileged few in those countries, who accumulated because of the political power they possess (or those who tied to them). Say, if you took a bribe of $1 million dollar overnight, would you worry about the dollar devaluation so much that you would risk not storing it in US treasury but in local currency that is more readily traceable and forfeit-able?

Instead, they are now panicking because of food/oil inflation (that is the result of the dollar devaluation and supply shortage). The rise of food and energy price presents a much bigger political structure problem as it is a bigger part of expenditure for their people. China has just announced that it would control its 2011-2015 growth rate to 7%. (http://e.nikkei.com/e/fr/tnks/Nni20110227D27JF946.htm) If you look at Chinese GDP growth history, you would notice how low that 7% figure is:
http://www.tradingeconomics.com/Economics/GDP-Growth.aspx?Symbol=CNY

I personally think applying brakes to the world’s largest growth engine at the moment has a bigger impact across the globe than for the treasury yield to increase one or two percentage points. This thread has many posts about how the government is in bed with the riches, but nothing drives those in power crazier than the possibility of losing that power. They will do everything to defend that regardless of the economy consequence and the feeling of their rich friends/relatives.

Given that the stock market is still fairly richly priced at the moment, I personally would gradually diminish my exposure rather than waiting to confirm that this is the “big one”.