USA's Debt-to-GDP of 121%

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  • marcus
    Member
    • Jul 2008
    • 9239

    USA's Debt-to-GDP of 121%

    From https://finance.yahoo.com/news/u-pan...111430360.html
    Title : U.S. panic over national debt might mark a culture shift—are Americans becoming more ‘European’ about money?
    By Ryan Hogg / Fortune.com , Apr 26, 2024

    ...At the latest count, the U.S. was sitting on a debt-to-GDP ratio of 121%. The eye-watering US$33.1 trillion figure means every American is in equivalent debt to the tune of US$100,000...

    JPMorgan CEO Jamie Dimon said the U.S. needed to address debt levels before foreign owners of U.S. bonds staged a “rebellion,” while US's Fed Chair Jerome Powell said it was time for Americans to have an “adult conversation” about debt levels...

    The country’s deficit jumped to 5.7% of GDP in 2023, a shift that might be the main culprit behind a recent uproar among analysts. Earlier in April, the IMF / International Monetary Fund called on the U.S. to urgently address this deficit...
  • marcus
    Member
    • Jul 2008
    • 9239

    #2
    From https://www.visualcapitalist.com/97-...-debt-in-2023/

    Countries' Debt in 2023:

    ..............................Debt............ %...... Debt-to-GDP
    U.S. $33,228.9 34.2% 123.3%
    China $14,691.7 15.1% 83.0%
    Japan $10,797.2 11.1% 255.2%
    UK $3,468.7 3.6% 104.1%
    France $3,353.9 3.5% 110.0%
    Italy $3,141.4 3.2% 143.7%
    India $3,056.7 3.1% 81.9%
    Germany $2,919.3 3.0% 65.9%
    Canada $2,253.3 2.3% 106.4%
    Brazil $1,873.7 1.9% 88.1%
    Spain $1,697.5 1.7% 107.3%
    Mexico $954.6 1.0% 52.7%
    South Korea $928.1 1.0% 54.3%
    Australia $875.9 0.9% 51.9%
    Singapore $835.0 0.9% 167.9%
    Belgium $665.2 0.7% 106.0%
    Argentina $556.5 0.6% 89.5%
    Indonesia $552.8 0.6% 39.0%
    Netherlands $540.9 0.6% 49.5%
    ....
    Greece $407.2 0.4% 168.0%
    Türkiye $397.2 0.4% 34.4%
    Russia $394.8 0.4% 21.2%
    ....
    Switzerland $357.7 0.4% 39.5%
    ....

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    • marcus
      Member
      • Jul 2008
      • 9239

      #3
      From https://finance.yahoo.com/news/gen-z...175134969.html
      Title : Gen Z will pay dearly for this U.S. blunder on the massive debt that boomers, Gen X, and millennials are dumping on them, former White House economist warns
      By Jason Ma / Fortune.com , May 6, 2024

      ...High borrowing costs have kept young adults out of the housing market, while some scholars are also pointing to social media's impact on anxiety.

      But Todd Buchholz, who served as White House director of economic policy under President George H.W. Bush, said "members of Gen Z must also worry about the irresponsible debt levels that baby boomers and Generations X and Y (millennials) are foisting onto their narrow shoulders."

      To be sure, U.S. debt levels have been surging for decades. But in recent years, it has topped key milestones. For example, gross federal debt as a share of U.S. GDP has exceeded the level reached in the immediate aftermath of World War II. In fact, the cost of servicing the debt is now expected to eclipse defense spending this year...

      "Half of young adults don’t think they will ever afford a home, yet they will be asked to pay for their grandparents’ profligacy," he wrote in an op-ed for Project Syndicate on Wednesday.

      The U.S. had an opportunity to improve the debt outlook, but passed up on it, Buchholz explained. For years after the Great Financial Crisis, the Federal Reserve's monetary stimulus kept yields on Treasury bonds at rock-bottom lows, meaning the interest on U.S. debt was historically cheap.

      The Treasury Department, which sells U.S. debt to global bond markets, could have locked in those low rates by issuing 50- or 100-year bonds, rather than durations that typically max out at 20 or 30 years.

      "But the Treasury mostly stuck to short-term borrowing, with the average duration of bonds at just five years," Buchholz said. "As a result, it is rolling over maturing debt at a steeper cost."

      In March 2021, when U.S. bond yields were still at low levels of around 1.5%, Treasury Secretary Janet Yellen said there were "no current plans" to issue super-long debt. That prompted hedge fund manager Stanley Druckenmiller last year to call it the "biggest blunder in Treasury history." Today, yields are hovering near 4.5% after topping 4.7% late last month.

      While the U.S. missed its chance to secure cheap debt, at least 14 countries as well as dozens of corporations and universities issued super-long bonds, Buchholz pointed out.

      But he added there may be other opportunities in the future and suggested the Treasury Department should unleash a flood of super-long bonds whenever inflation-adjusted yields drop below the historical average of about 1.55%.

      Still, that won't tackle the massive federal deficits that are driving the surge in U.S. debt.

      "Of course, the fundamental budget problem is too much spending," Buchholz said. "President Ronald Reagan once joked that the government is like a baby: it has a big appetite at one end, and no sense of responsibility at the other. That quip is as true today as it was a half-century ago."

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      • marcus
        Member
        • Jul 2008
        • 9239

        #4
        From https://finance.yahoo.com/news/overd...150000559.html
        Title : Overdue Bills Are Rising With US Debt Delinquencies, Fed Survey Shows
        By Alex Tanzi and Jonnelle Marte / Bloomberg , May 15, 2024

        US household debt has reached a record and more borrowers are struggling to keep up.

        Overall US household debt rose to $17.7 trillion, according to the Federal Reserve Bank of New York’s Quarterly Report on Household Debt and Credit released Tuesday. That’s an increase of $184 billion, or 1.1%, from the fourth quarter.

        The data highlight the mounting financial pressures on American families in an age of elevated inflation. The persistent rise in the prices of essentials such as food and rent have strained household budgets, pushing people to borrow against their credit cards to pay for necessities.

        Consumers have added $3.4 trillion in debt since the pandemic, and that increased debt bears much higher interest rates.

        Total credit card debt stood at $1.12 trillion in the first quarter of 2024, according to the report...credit card balances are up almost 25% from the first quarter of 2020...“With inflation and interest rates likely to remain elevated, there’s a very good chance credit card balances will surge to new highs later in 2024.”...
        Consumers facing a financial squeeze may be maxing out their credit cards and falling behind on payments, Fed researchers said...

        The Fed researchers found younger borrowers and those with lower incomes are more apt to be financially stressed...

        “In the first quarter of 2024, credit card and auto loan transition rates into serious delinquency continued to rise across all age groups,”...“An increasing number of borrowers missed credit card payments, revealing worsening financial distress among some households.”...

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