Our Ticking Public Debt Time Bomb
==========
The article discusses the unsustainable path of the US public finances and the potential consequences. The nonpartisan Congressional Budget Office (CBO) warns that under present policies, the budget deficit will remain at around 6.5 percent of GDP, taking the public debt level to almost 130 percent of GDP by 2033. The limited economic growth prospects make it unlikely that the US will be able to grow its way out of the debt burden. While a US debt crisis is not imminent, excessive money printing can lead to dollar weakness and inflation. Other countries with higher debt levels, such as Italy and Japan, have not faced a debt crisis yet. The vulnerability of the US banking system and the likelihood of a regional bank crisis could compound the budget deficit problem. A recession caused by a banking crisis would reduce inflation and usher in a period of low interest rates, but it would also worsen the budget deficit problem. The article is written by Desmond Lachman and was published on May 24, 2024.
#PublicDebt #BudgetDeficit #EconomicGrowth #Inflation #BankingSystem #Recession
https://www.aei.org/economics/our-ticking-public-debt-time-bomb/
American Enterprise Institute /
npub14z…4fwd3
2024-05-24 15:56:40
Author Public Key
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wss://relay.nostr.band/allPublished at
2024-05-24 15:56:40Event JSON
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"content": "Our Ticking Public Debt Time Bomb\n==========\n\nThe article discusses the unsustainable path of the US public finances and the potential consequences. The nonpartisan Congressional Budget Office (CBO) warns that under present policies, the budget deficit will remain at around 6.5 percent of GDP, taking the public debt level to almost 130 percent of GDP by 2033. The limited economic growth prospects make it unlikely that the US will be able to grow its way out of the debt burden. While a US debt crisis is not imminent, excessive money printing can lead to dollar weakness and inflation. Other countries with higher debt levels, such as Italy and Japan, have not faced a debt crisis yet. The vulnerability of the US banking system and the likelihood of a regional bank crisis could compound the budget deficit problem. A recession caused by a banking crisis would reduce inflation and usher in a period of low interest rates, but it would also worsen the budget deficit problem. The article is written by Desmond Lachman and was published on May 24, 2024.\n\n#PublicDebt #BudgetDeficit #EconomicGrowth #Inflation #BankingSystem #Recession\n\nhttps://www.aei.org/economics/our-ticking-public-debt-time-bomb/",
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