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Economics @lemmy.world

babysandpiper @sopuli.xyz

2d ago

US debt is now $37trn – should we be worried?

US debt is now $37tn – should we be worried?

As Donald Trump cheered the passage of his self-styled, and officially named, Big Beautiful Budget Bill through Congress this week, long-sown seeds of doubt about the scale and sustainability of US borrowing from the rest of the world sprouted anew.

Trump's tax-cutting budget bill is expected to add at least $3 trillion (£2.2 trillion) to the US's already eye-watering $37tn (£27tn) debt pile. There is no shortage of critics of the plan, not least Trump's former ally Elon Musk, who has called it a "disgusting abomination".

The growing debt pile leaves some to wonder whether there is a limit to how much the rest of the world will lend Uncle Sam.

World News @quokk.au

OutForARip @lemmy.ca

2d ago

US debt is now $37trn – should we be worried?

www.bbc.com /news/articles/c1lj8rmyn5eo

29 comments

Lmao ppl like "hmm generally, im not worried about anything... everything is so great why would I? But I see this article... should I? Should I worry?"
The worst part of the debt is that nothing good was done with it.
If you use that money to implement a national healthcare system, or fix the national infrastructure, or stabilize social security, or figure out child care, or work on affordable housing, or fix the cost of education, or invest in renewable energy, etc. then maybe it's worth it. Hell, you might even end up net positive in the end with all the good done to society in the long run.
Instead, all of these things are even worse than before while most of the money was spent on a bunch of useless wars and tax cuts for the rich.
And now, there's no more easy money to be borrowed to fix anything.
With Trump weakening the trust in the dollar and people looking at the Euro as a new reference, the rates at which the US can borrow money is already going up. At 37tn borrowed, even a tiny uptick will cost a fortune or two. Which, unless the conservatives suddenly show fiscal responsibility (which they never did so far), will just increase the deficit.
handling it the only way i know how
- There is so much going on in this picture I don't even know where to start
  
  Is that a bowling pin video?
  
  The lack of a numpad on that keyboard is what sticks out to me
People need to understand that the debt is not the issue. It's healthy to run a national debt. The massive problem is the dollar is being run into the ground. We are losing allies left and right which compounds your debt. He is fucking us on both sides.
- just like Stephen Miller wanted
US is going isolationist. Our debt becomes the worlds problem.
We're trying the single guy life for a while again. So rest of the world we're breaking up, it's definitely us not you but we're leaving all our baggage to you and keeping some of the keys. You
Enjoy your orgies of on going cooperations and spirits of goodwill, you heathen scum.
- Except for all the military bases literally everywhere.
  
  Which we'll see how long those last. Isolationism means isolationism though. But I bet this admin can't even do that right.
Trump understands that it doesn't matter about the debt. Who does he owe it to after all? The banks won't call the debts in, cause they don't need to, and if he devalues the dollar he sees it as a win for exports
- 'He' (the US) owe it in large part to the world, who were forced to buy us debt in order to buy oil. China is the biggest holder of US debt iirc.
  The US's voluntary withdrawal from the post ww2 economic order (from which it profited greatly) has absolutely hastened and cemented this process of 'dedollarisation'.
  This debt is coming due, the strength of the dollar has already dropped greatly, US interest rates will rise. The US dollar will be cheap enough to compete with India and China to be the world's factory (a major part of Trump's election campaign and success).
  It won't happen all at once as the world will look to manage America's decline while trying to maintain as stable a transition as possible.
  But please be aware, this debt is going to come due and it has absolutely been hastened by Americans voting for Trump a second time. Fore warned is forearmed. Good luck.
  
  China is the largest foreign holder, but the vast majority of the debt is owed domestically.
  
  Japan is actually the largest US debt holder with over 1.2T. China is 4th iirc with around 750B.
  
  I wouldn't bet on that. American military might is still untouchable, and America is still a huge oil producer
at 123% years old long overdue; we always had a spending problem - too many defense hawks keeping their beaks wet
Should I start to worry? (South Park)
The $3.4T deficit increase projection, $340B/year is on top of the $1.9T projected deficit for 2025 prior to bill. The projected deficit for FY2035 is $2.7T. This is before golden dome, and other warmongering/Israel funding. 2025 and 2035 numbers are both about 6.1% of GDP.
GOP talking points have include the fantasy of growing at 3% (instead of 1.9%) annually to pay for the $340B/year increase, but at 6.1% deficit/GDP ratio, total debt increases as long as nominal GDP doesn't grow above 6.1%. Cutting healthcare, and population through deportations won't cause growth.
Yeah, I should worry… but with all the other shit that’s going on, my worry buffer is on overflow. I’m gonna pretend I didn’t read this.
The lending should take into account the reduced defence spend the US is asking other regions to take up.
I have lost all faith in fiat currency, and so I only now hold Goldbacks and Monero. If I need fiat currency to pay for something, I can easily get it using one of those two currencies that are stronger.
Edit: pretty sure i struck a nerve. After all, how dare slaves have thoughts of their own
- No one cares about your libertarian gimmick cash and shitcoins, buddy.
- America realized the USD is dying... So now they're stockpiling immigrants for after the dollar crash.

29 comments