America’s ticking time bomb: $66 trillion in debt that could crash the economy

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SOURCE: NY POST

Wake up, America. That ticking sound you’re hearing is the American debt time bomb that with each passing day is getting precariously close to detonating and crashing the US economy.

Businesses, consumers and especially the federal and state governments have become hooked on red ink as if it were crack cocaine.

Two factors have fueled this borrowing binge: an era of low interest rates (that’s coming to an end) and falling real wages thanks to the 15% rise in prices of Bidenflation.

Let’s review the borrowing up-escalator that accelerated during COVID but hasn’t subsided.

The King Kong of borrowing is Uncle Sam. The national debt is $31 trillion when including Social Security’s and Medicare’s unfunded liabilities.

That’s getting close to 150% of our national gross domestic product of $22 trillion. Some $5 trillion has been added in just the past three years.

Balancing the budget seems like a pipe dream these days.

Next add state and local government debt and unfunded liabilities. The American Legislative Exchange Council estimates that at just under $6 trillion.

Now what about American households? The latest estimate for consumer debt is $16.5 trillion, per the New York Federal Reserve.

Most of that debt is mortgages, but increasingly Americans are taking on debt for routine expenses to pay monthly bills like groceries and gas at the pump.

Thanks, President Joe Biden.

Then we have corporate America and small businesses. Their debt burden, according to the Federal Reserve Board, just surpassed $10 trillion for the first time.

Business borrowing can be a good thing — indicating economic optimism. But we have to wonder how many more FTX-type bubbles are out there inflated by low interest rates and all that helicopter money from Washington.

So add it all up, and American society now owes $66,000,000,000,000 of debt! That’s roughly three times our annual GDP.

Then we have corporate America and small businesses. Their debt burden, according to the Federal Reserve Board, just surpassed $10 trillion for the first time.

Business borrowing can be a good thing — indicating economic optimism. But we have to wonder how many more FTX-type bubbles are out there inflated by low interest rates and all that helicopter money from Washington.

So add it all up, and American society now owes $66,000,000,000,000 of debt! That’s roughly three times our annual GDP.

Consumers are now engaged in the same reckless monkey-see, monkey-do behavior. The latest Federal Reserve Bank of New York report says credit-card debt has skyrocketed by 16% this year to above $1 trillion.

Christmas season is witnessing even more debt to buy Yuletide gifts. Low-income Americans are taking on debt at the fastest pace of all. Come January, don’t be surprised if Americans look at their credit-card debt and suffer severe buyers’ remorse.

For now, defaults and delinquencies are low, but we should have learned financial seas can shift on a dime.

Meanwhile, the feds keep feeding the debt surge by increasing taxpayer mortgage insurance for million-dollar homes.

Debt isn’t necessarily a bad thing. It depends what we’re getting for it. When we borrow for roads or factories or homes or to finance our military to win wars, borrowing can be necessary and appropriate.

But we aren’t doing that. We’re borrowing to pay people not to work. We’re borrowing to finance windmills, Teslas and “reparation” payments to other nations and to pour money into failing schools and ObamaCare subsidies that go to Americans making up to $500,000.

We’re acting like a nation of wild-eyed teenage girls on a shopping spree at the mall — armed with daddy’s credit card.

At some point soon, we’re going to have to start paying our bills or this debt time bomb is going to implode. It won’t be pretty.

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1 COMMENT

  1. This is where CBDC is going to come in. Collapse the old system, then implement a new one. The stage is being set for this transition — And they’re telling you about this probable catastrophe to make it more acceptable, demandable by the people. They create the problem, and sells you the solution.

    So welcome to the new programmable, trackable, controllable Central Bank Digital Currency — Where you’ll be an obedient citizen or you won’t get to participate in their dystopian society.

    “If you want a picture of the future, imagine a boot stamping on a human face — forever.”
    — George Orwell, Nineteen Eighty-Four

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