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US government debt is on track to surpass $50 trillion by 2033.

By: Decomposed in 6TH POPE | Recommend this post (0)
Mon, 13 Nov 23 9:43 AM | 34 view(s)
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It's much worse than BofA projects. Note how beginning in 2023, they think the debt will suddenly, magically, only grow as a straight line instead of exponentially like it has for more than fifty years. Each year, the interest owed on the debt will be getting bigger. Yet the annual deficit will stay the same? Where's all the extra money to make those increasing payments going to come from, BofA?

What BofA is doing is pretending that despite mounting expenses, the deficit won't worsen. That's absurd. This is a case where the analysts painted the rosiest possible picture without regard to realism. That's what politicians - and, apparently, corporate bureaucrats - do. The truth is that the debt will worsen at an accelerating rate unless some future administration, or reality, imposes EXTREME austerity measures upon us. And no politician is going to do that because politicians are allergic to the sound of screaming - particularly their own. If one were crazy enough to try it, he'd be promptly voted (or impeached) from office... as would the next guy.


November 7, 2023

US government debt is on track to surpass $50 trillion by 2033. That means $5.2 billion is piling up every day.

•  The US government's public outstanding debt is on track to surpass $50 trillion by 2033.
•  The increase comes out to roughly $5.2 billion every day or $218 million every hour, Bank of America estimated.
•  "Central banks may simply bail out governments in coming years via QE," BofA said.


by Matthew Fox
BusinessInsider.com


The US government's debt is on track to surpass $50 trillion by 2033, Bank of America said in a Tuesday note, citing data from the Congressional Budget Office.

US public debt outstanding currently sits at $33.6 trillion and is expected to surge by $20 trillion to $54 trillion within the next decade amid "fiscal excess in the 2020s," Bank of America investment strategist Michael Hartnett said.

"US public debt is... more than the combined GDPs of China, Japan, Germany, and India," he wrote, adding that the outstanding debt is set to surge by $5.2 billion every single day, or $218 million every hour, for the next 10 years.

The surge in debt has coincided with an explosion in the federal deficit, which jumped by $320 billion to $1.7 trillion in 2023. That's forced the Treasury Department to auction trillions of dollars of fresh bonds.

Adding to the burden is the surge in annual interest payments caused by spiking bond yields. Those payments are taking up a bigger slice of the federal budget and widening deficits. Estimated annualized debt interest payments surpassed $1 trillion in October.

And as long as US policymakers continue to borrow more heavily and add to the government's outstanding debt, investors are poised to worry about the lingering risks of inflation, bond defaults, and currency debasement, according to BofA.

"Likely central banks may simply bail out governments in coming years via quantitative easing and the introduction of yield curve control (policies that would be US dollar negative)," Hartnett said.

A separate measure of US debt that's more closely followed by economists is "debt held by the public," which is less daunting but still on a steep uptrend. At the end of fiscal 2023, it stood at $26.3 trillion, or 98% of projected GDP, and the CBO sees it climbing to 115% by 2033.

But even if interest rates do fall and the federal deficit is contained, don't expect the federal government to ever stop borrowing money. US debt will always rise because it fuels economic growth and helps drive the circulation of money.

Besides, the one time the government did pay off all of its interest-bearing debts in 1835, a two-year depression shortly followed.

http://markets.businessinsider.com/news/bonds/us-debt-50-trillion-2033-federal-deficits-treasury-bond-crash-2023-11




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