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The Kobeissi Letter
Public Telegram feed monitored for macro-market headlines and commentary.
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The US debt crisis is set to become significantly worse:
Entitlements, interest, and other mandatory outlays are estimated to consistently surpass Federal tax revenues by 2031, according to CBO.
These expenditures are projected to rise to ~20% of GDP by 2040.
That would be the highest percentage on record when excluding the 2020 and 2021 pandemic period.
Net interest alone is estimated to reach 5% of GDP, an all-time high.
At the same time, tax revenues are expected to increase only modestly, to 18% of GDP, the highest since 2020.
To put this into perspective, tax revenues as a % of GDP exceeded entitlements, interest, and other mandatory outlays by 8 percentage points in 2000.
What is the long-term plan here?
(@TheKobeissiLetter)