Two Big Spending Presidents Led the Way
We have talked a lot about the impending debt crisis as a serious threat to the existence of our country as we know it. The risk is when the US cannot sell its debt and there are no buyers, what will the United States do?
I have looked at this closely and believed that the danger is real but have never thought it was near, possibly 10 or more years away. We have some time to fix the problem, but if we do not and when the crisis comes, it will be disastrous.
I have taken a closer look at the data and am concerned that the day may be closer than I had thought. Next year we will have to sell almost $10 trillion dollars of debt, about $2 trillion to finance the deficit and almost $8 trillion to refinance maturing debt. The total interest-bearing debt will be around $36 trillion dollars in a year.
At the same time, the demand for the debt is decreasing as the Federal Reserve reduces its holdings which means lower demand and foreign countries are reducing their holding as well. All this means less demand and a lot of supply. At what point do the buyers get spooked and stop buying? I don't know but it is concerning me that the day may be approaching much sooner than I had anticipated.
The Mises Institute had an interesting article about this, As the US Treasury runs Out of Creditors, its Options Dwindle. Please take a look.
The Ship of State is headed directly at the iceberg - I don’t know exactly when we will hit it and sink, but someday we will if we do not change course. Is that day coming sooner or later? Nobody knows, but I do know it is coming if we do not change course.
Don’t let that happen on our watch. Speak up, Speak out. Tell your representative to FIX THIS MESS. You can go to our website and Contact Congress, just enter your name and address and send.
LEARN ECONOMICS, THEN VOTE SMART