The total amount of debt owed by the US government is skyrocketing.
The Treasury’s FiscalData platform shows $106.12 billion has been piled onto America’s debt in the seven-day stretch ending on October 18th.
After crossing the $33 trillion mark on September 15th, total outstanding US debt now stands at $33.62 trillion – an increase of about $17.71 billion per day.
In a new interview with Bloomberg TV, Rockefeller Capital CEO Greg Fleming says he’s concerned about the rising debt burden and the impact that America’s interest payments will have on growth.
“On the current trajectory, interest payments on the federal budget will exceed military expenditures by 2027. So higher for longer has a big impact on the fiscal side of the equation, which is relevant to all investors because the US debt situation is definitely a concern…
If we have a recession, you could see a double-digit deficit as a percentage of the federal budget. So with that kind of fiscal spending already embedded in the economy, will there be enough growth for investors in the US market? It’s a real concern that the fiscal side of the equation could be a headwind for investors going forward.
So you have that that investors are focused on. And then you have the Fed, who’s obviously been raising rates to try to deal with inflation. Those higher rates are also working their way into the fiscal situation. So you have a headwind on the monetary policy side. You’re likely to have an increasing headwind on the fiscal policy side. So investors look more cautiously at the medium-term outlook for the US.”
New data from the Congressional Budget Office (CBO) shows the US government’s spending exceeded its revenues by $1.7 trillion in the now concluded 2023 fiscal year.
That represents a $300 billion jump from the year before.
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