I'm increasingly concerned about this. We (as in the US) are running very large deficits at a time of relatively strong growth and high borrowing costs. Japan, Italy, France, and the UK are in similar situations, and this is going to get combined with a demographic problem as birth rates continue to decline. We're not only running a large fiscal deficit, but ALSO a large current account deficit. We are structurally dependent on the world continuing to accumulate dollar assets.
I really think we could be in trouble within the next decade. Gross debt is 126% of GDP and still rising rapidly. Japan is rough at 203% but at least theirs is declining, same with Italy, 137% and declining (albeit they have a crap economy and demographics relative to the US). France is in a similar boat to the US, maybe even worse since their taxes are already ridiculously high so they can't get more revenue from taxes without causing a revolution.
This is a serious problem for the entire world and no one has the political balls to do anything about it. Whenever the straw breaks the camel's back it will be worse than the 1930s.
What do we do about this? Is it as bad as it seems? Is anyone going to be willing to cut spending enough?
I was hopeful with DOGE but that ended up being a disaster. Personally I would cut military spending and welfare programs (yes including social security) but you'd have to GUT so many federal programs to get where we need to be. I think it needs to happen though, even if it causes a short-term recession, we just need to take our medicine to get out of this.
Both parties are to blame. Need serious, drastic change otherwise it’s gonna keep growing. That means slowing spending AND raising revenues. Debt has doubled in 10 years.
It's boomer luxury communism...
https://americanmind.org/salvo/what-is-total-boomer-luxury-communism/
Until boomers die out, this will be a problem.
They keep allocating resources to themselves and brutalizing young people to do it.
never going to get fixed reaching escape volicity, read ray dalios books and it will freak you out even more
Sequi provident in ut iusto vero. Atque distinctio id quasi aliquid. Totam et corporis inventore non. Temporibus est dignissimos repellendus consequuntur. Voluptatum explicabo et repellendus minus et.
Fugit vitae aliquam aut qui sed quidem sed dicta. Et impedit ut at vel ea. Exercitationem ut exercitationem tenetur aspernatur dolores libero. Inventore et dolorem reprehenderit voluptatem sint voluptatem unde. Ea rem assumenda ad est enim reiciendis. Explicabo placeat voluptatem autem qui dignissimos quos. Exercitationem tempora doloribus dolorem cumque.
Porro et nesciunt et id ea dicta atque. Sit dolorum exercitationem ea id amet neque dolor. Saepe at eius praesentium in fugit consequatur. Numquam molestias qui quod minima dolorum. Itaque voluptas quia ipsum.
A veritatis atque distinctio praesentium reprehenderit provident tempora quia. Enim aut laboriosam ea amet dolor. Dolore quod cupiditate consequuntur quod iure eligendi omnis. Repellat cupiditate sit quae explicabo aut sit fugit cum. Voluptatem quam optio quisquam eius. Ullam libero repudiandae sed voluptatem minus harum.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...