Treasury officials now face a trifecta of headaches: a mountain of new debt, a balloon of short-term borrowings that come due in the months ahead, and interest rates that are sure to climb back to normal as soon as the Federal Reserve decides that the emergency has passed.
But the Fed can decide whatever it wants whenever it wants, so is that really an issue?
With the national debt now topping $12 trillion, the White House estimates that the government’s tab for servicing the debt will exceed $700 billion a year in 2019, up from $202 billion this year, even if annual budget deficits shrink drastically. Other forecasters say the figure could be much higher.
That’s some pretty heavy interest.
Americans now have to climb out of two deep holes: as debt-loaded consumers, whose personal wealth sank along with housing and stock prices; and as taxpayers, whose government debt has almost doubled in the last two years alone, just as costs tied to benefits for retiring baby boomers are set to explode.
Funny how we get stuck with the debt when we never approved the borrowing.
“What a good country or a good squirrel should be doing is stashing away nuts for the winter,” said William H. Gross, managing director of the Pimco Group, the giant bond-management firm. “The United States is not only not saving nuts, it’s eating the ones left over from the last winter.”
I know a few nuts that should have been stashed away for the remainder of time. Or eaten.
The White House estimates that the government will have to borrow about $3.5 trillion more over the next three years.
Hey, I have an idea that will save us trillions. Get out of the Middle East.
....but hey, do what you want....you will anyway.
No comments:
Post a Comment
Comments are moderated. There may be some delay before your comment is published. It all depends on how much time M has in the day. But please comment!