The monumental challenge of Debt in the US seems unstoppable, aggravated by the constant increase in Interest rates that exert constant pressure on the economy. As a result, the country’s national debt reached unprecedented levels.
In a historic milestone, the total US federal debt surpassed 33 billion dollarsAs reported The Kobeissi Letter on September 19.
The president of the Committee for a Responsible Federal Budget, Maya MacGuineasexpressed his concern: “The United States reached a new milestone that no one will be proud of: our gross national debt just surpassed $33 trillion”.
Macroeconomic analysis maintains that the United States government had added $1 trillion in debt each month since the debt ceiling “crisis,” a debate that has been going on since the beginning of this year.
On June 3, the president Joe Biden approved a bill that eliminated the multibillion-dollar debt ceiling limit of the government, allowing the accumulation of more debt. Furthermore, that ceiling is currently has no limit until January 2025.
USA and its debt
Over the past five years, the United States has accumulated a total of 11.5 trillion dollars in debt. At the same time, the country is on its way to paying 1 billion dollars in annual interestwhich begs the question: “How can this end well?” according to The Kobeissi Letter.
At the current rate, the United States could exceed 50 billion dollars in debt long before the end of the decade.
The website American debt clock in real time places the real figure at 33.04 trillion dollars, comparing this astronomical amount with the total value of the crypto market, which is only 1.1 trillion dollars. By 2027, The accountant estimates a national debt figure of 45 trillion dollars.
Furthermore, the ratio of US federal debt to GDP is currently 122.4%, according to the debt clock.
Despite these terrifying figures, the Secretary of the Treasury, Janet Yellen, seems not to be too worried. In an interview with CNBC, she mentioned: “The statistic I follow closely to evaluate our fiscal position is net interest as a percentage of GDP”, referring to the federal government’s net payments on its debt relative to gross domestic product.
Nevertheless, Mark Spitznagelfounder of the hedge fund Universa Investments, warns that the country is facing the “mbiggest credit bubble in human history“He added: “We have never seen anything like this level of total debt and leverage in the system. It’s an experiment. But we know that credit bubbles have to burst. We don’t know when, but we know they have to do it”. This warning raises crucial questions about the economic future in a scenario of overflowing debt and rising interest rates.
Source: Ambito
I am a 24-year-old writer and journalist who has been working in the news industry for the past two years. I write primarily about market news, so if you’re looking for insights into what’s going on in the stock market or economic indicators, you’ve come to the right place. I also dabble in writing articles on lifestyle trends and pop culture news.
