October 31, 2023
What comes after trillion?
Nearly 1/3 of all outstanding US debt is set to mature over the next 12 months.
52% is set to mature over the next 36 months, meaning this debt needs to be refinanced.
Since this debt was last financed, debt service costs have doubled from 1.5% to 3.0%.
This means that maintain this debt is now 2x as expensive and it will soon be 3x as expense as rates rise.
US interest expense will continue to rise over the current $1 tril/yr.
$2 tril in annual interest expense is coming quickly.
The higher debt service and diminishing returns on our increased debt levels will place a drag on GDP.
I think they had no intention of ever paying this back. I think they figure we will create a new, cashless society and all national debts will be erased so there is no reason not to run it up now. Who wouldn't blow through borrowed money if you knew you were never going to pay it back? I doubt we'll ever see a Quadrillion in debt not because it's impossible but because the whole world will default first.
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