U.S. Debt currently stands at $31.4 trillion, and the Senate just voted to suspend the debt ceiling until 2025, so until then, the sky's the limit for U.S. Debt, sort of.....
In return for raising the limit the Democrats had to agree to limit government spending next year, keeping it level with this year, and then only a 1% increase in 2025.
Given the current rates of inflation this will mean a real terms decrease in spending on welfare and infrastructure projects, and is equivalent to savings worth $1.5 trillion over the next couple of years.
The only exception is defence spending which has no cap, so the FED is free to spend as much as it wants on nukes and bombs and basically killing who it wants.
So everything's fine!
FINE!
Just fine!
By 2030, based on current projections, the annual U.S. deficit will only have risen only slightly to -6% of GDP, meaning that overall by 2030 the total deficit will only be around 100% of US GDP.
All of this is, of course assuming that there are no global crises for the next 7 years until 2023: so no wars, massive terrorist attacks, banking collapses, or pandemics that are going to inflict another couple of trillion onto the budget deficit in the space of a few months.
So just carry on...?
I mean why not, I mean I can't see any problem with just keeping on going, I mean what's the problem when it seems there is no likely scenario that the U.S. is ever going to be able to pay back its debt.
Surely they're planning a financial (global currency) reset?
The more I look at the above the more I expect there's going to be some sort of real financial shock in the form of just writing off the above debt and implementing a CBDC that transfers the above debt to poor people and puts it on them and their unfortunate children to pay by probably doing free labour or alternatively choosing to die and having their assets go the State.
The above situation can't go on forever, it just looks unfeasible to me.
Lol, this got me laughing.
Anyway, I think the postponement is a welcome one cause that might hamper the economy and make investors withdraw their investments.
I don't know what the effect will be - no limit is an interesting one+
they put on such a clown show each time as if they are ever going to not raise it lol
Not only not raising it - no limit this time around!
The thing FED fears the most is deflation. While US government fears losing entitlements. A lot of that deficit are social security and benefits paid out to Americans. Printing money to pay for the deficit will likely cause inflation but like others said many countries are worse off than US.
Yes fair point
My country has a debt of some billion $ and we are in a bad situation due to this, IMF is at our door trying to crush us, Why does no one ask the US about this insane amount of debt?
Because the IMF have more seats of power with the IMF!
You damn right, how the hell will they clear such debt, i guess resetting the currency is the only option here. Wow never thought this day will come where the US of all country will fall down its knees. Guess my country is not the only one not being debt free.
I think the day's getting closer, but the U.S. debt is different it seems!
It better gets closer, with the US down even other countries are affected. The debt is different in what aspect elaborate more please
I understand that with a debt-based monetary system, repaying the debt isnt the way it works, it should keep growing in perpetuity.
Yeah I've heard this too but it can't be true - some of that debt is held by insts who need a return so the higher it goes the more gpd is reqd to service it.
I hope that projection is for the total debt rather than the total deficit. 😉
As bad as the situation is in the U.S., it’s even worse elsewhere. I’ve been reading Peter Zeihan’s The End of the World is Just Beginning which has very negative things to say about European debt and apocalyptic things about Chinese debt.
Oh yeah my bad debt! Sounds like a good read
This might affect cryptos negatively.
I thought it might be positive - no default for a year
At some point we are going to run out of road to kick the can down and I am very concerned for how badly and quickly things may escalate when we get there.
The way we are seeing the situation in America is not good and if they print money at this time, we will see their economy getting worse like Pakistan's. And if they raise interest rates, people will start putting their money in the banks again, but then after a while the banks won't have the money to lend again, so they have to default.