The concerns expressed by finance experts center on the cumulative impact of annual deficits approaching $1.5 trillion in the United States, leading them to believe that “the country is headed toward an abyss.” .
Bill Grossco-founder of PIMCO and recognized as the “Bonus King“warned of an imminent escalation in the US debt crisis. Comparing the future implications of the astronomical $34 trillion national debt With the destructive effects of climate change, Gross, in that sense, emphasized the possibility of a significant increase in inflation.
The concerns expressed by Gross focus on the cumulative impact of annual deficits approaching $1.5 trillion. Pointing to the growing disparity in rates and the accumulation of short-term debt, the PIMCO co-founder highlighted that, in the next two to five to ten years, annual deficits could become a considerable problemsimilar to the slow but destructive advance of global warming.
As the United States continues to overspend, The Federal Reserve is seen by the markets as the potential financier of these deficits. However, Gross warns that this approach could trigger more inflation. Wall Street experts have expressed similar concerns, suggesting that future inflation could lead to higher interest rates, more debt and hampered growth.
Unless legislative measures are implemented to limit excessive spending, The United States is at risk of facing debt defaults in the next two decades, which could have significant global economic repercussions.
Another expert warned about the US debt
These concerns were also shared by Jamie Dimon, who warned that the Congressional Budget Office had already indicated in early January that the national debt could double in the next three decades. Dimon described the situation as an imminent precipiceapproaching about ten years into the future, highlighting how quickly the country is moving towards an unsustainable debt load.
Along the same lines, the US Secretary of the Treasury, Janet Yellen, described as “terrifying” the amount of the country’s foreign debt, whichwhich amounts to $34 billion. With the US federal government’s debt exceeding $33 trillion by September 2023, and forecasts indicating a steady rise, the country’s financial situation is becoming increasingly critical.
In November 2023, Bank of America forecast an additional $20 trillion increase in public debt over the next decade, projecting daily growth of $5.2 billion. According to reports from the Congressional Budget Office, the country’s debt will nearly double over the next three decades, reaching 97% of GDP by the end of 2022 under current legislation.
Source: Ambito
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